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HomeMy WebLinkAbout2018 CON Pun Group - Auditing ServicesAGREEMENT BY AND BETWEEN THE CITY OF NATIONAL CITY AND THE PUN GROUP, LLP THIS AGREEMENT is entered into on this 17th day of July, 2018, by and between the CITY OF NATIONAL CITY, a municipal corporation (the "CITY"), and THE PUN GROUP, LLP, a Limited Liability Partnership (the "CONSULTANT"). RECITALS WHEREAS, the CITY desires to employ a CONSULTANT to provide independent auditing services. WHEREAS, the CITY has determined that the CONSULTANT is a certified public accounting firm and is qualified by experience and ability to perform the services desired by the CITY, and the CONSULTANT is willing to perform such services. NOW, THEREFORE, THE PARTIES HERETO DO MUTUALLY AGREE AS FOLLOWS: 1. ENGAGEMENT OF CONSULTANT. The CITY agrees to engage the CONSULTANT to perform professional auditing services, and the CONSULTANT agrees to perform the services set forth here in accordance with all terms and conditions contained herein. The CONSULTANT represents that all services shall be performed directly by the CONSULTANT or under direct supervision of the CONSULTANT. 2. EFFECTIVE DATE AND LENGTH OF AGREEMENT. This Agreement will become effective on July 3, 2018. The duration of this Agreement is for the period of July 17, 2018 through June 30, 2021, corresponding to audit services provided for fiscal years ending June 30, 2018 to June 30, 2020. This Agreement may be extended by mutual agreement upon the same terms and conditions for an additional one (1) year term. The Parties may exercise up to two one-year extensions. Any extension of this Agreement must be approved in writing by the City Council. 3. SCOPE OF SERVICES. The CONSULTANT will perform those auditing and accounting services as set forth in the attached Exhibit "A". The CONSULTANT'S services will be based upon tests of accounting records and other supporting evidence for selected periods during the fiscal year under review sufficient to enable the CONSULTANT to express an informed written opinion on: (1) the financial position of the various funds of the City; (2) the propriety of accounting principles followed; (3) compliance with applicable laws; and (4) the financial accountability of officers and employees. The CONSULTANT shall be responsible for all research and reviews related to the work and shall not rely on personnel of the CITY for such services, except as authorized in advance by the CITY. The CONSULTANT shall appear at meetings on an as -needed basis, to keep staff and City Council advised of the progress on the project. The CITY may unilaterally, or upon request from the CONSULTANT, from time to time reduce or increase the Scope of Services to be performed by the CONSULTANT under this Agreement. Upon doing so, the CITY and the CONSULTANT agree to meet in good faith and confer for the purpose of negotiating a corresponding reduction or increase in the compensation associated with said change in services. 4. PROJECT COORDINATION AND SUPERVISION. Mark Roberts, Director of Finance, hereby is designated as the Project Coordinator for the CITY and will monitor the progress and execution of this Agreement. The CONSULTANT shall assign a single Project Director to provide supervision and have overall responsibility for the progress and execution of this Agreement for the CONSULTANT. Kenneth H. Pun thereby is designated as the Project Director for the CONSULTANT. 5. COMPENSATION AND PAYMENT. The compensation for the CONSULTANT shall be based on monthly billings covering actual work performed. Billings shall include labor classifications, respective rates, hours worked and also materials, if any. The total cost for all work described in Exhibit "A" shall not exceed amounts set forth in Exhibit "B". The compensation for the CONSULTANT'S work shall not exceed the rates set forth in Exhibit "B". Invoices will be processed as set forth in Exhibit `B" for payment and remitted within thirty (30) days from receipt of invoice, provided that work is accomplished consistent with Exhibit "A", as determined by the CITY. Consistent with Section 7, the CONSULTANT shall maintain, at CONSULTANT'S expense, all books, documents, papers, employee time sheets, accounting records, and other evidence pertaining to costs incurred for a minimum of seven (7) years, and shall make such materials available at its office at all reasonable times during the term of this Agreement and for at least seven (7) years from the date of final payment under this Agreement, for inspection by the CITY, and for furnishing of copies to the CITY, if requested. 6. ACCEPTABILITY OF WORK. The CITY shall decide any and all questions which may arise as to the quality or acceptability of the services performed and the manner of performance, the acceptable completion of this Agreement,lind the amount of compensation due. In the event the CONSULTANT and the CITY cannot agree to the quality or acceptability of the work, the manner of performance and/or the compensation payable to the CONSULTANT in this Agreement, the CITY or the CONSULTANT shall give to the other written notice. Within ten (10) business days, the CONSULTANT and the CITY shall each prepare a report which supports their position and file the same with the other party. The CITY shall, with reasonable diligence, determine the quality or acceptability of the work, the manner of performance and/or the compensation payable to the CONSULTANT. 7. DISPOSITION AND OWNERSHIP OF DOCUMENTS. All working papers and reports must be retained, at the CONSULTANT'S expense, for a minimum of seven (7) years, unless CONSULTANT is notified in writing by the CITY of the need to extend the retention period. The CONSULTANT will be required to make working papers available, upon request, to the following parties or their designees: Standard Agreement Page 2 of 11 Revised July 2017 Pun Group, LLP City of National City and • The City Of National City; • U.S. Department of Housing and Urban Development (HUD); • U.S. General Accounting Office (GAO); • State of California, Office of the State Controller • Parties designated by the federal or state governments or by the CITY as part of an audit quality review process; and, • Auditors of entities of which the CITY is a sub -recipient of grant funds. In addition, the CONSULTANT shall respond to the reasonable inquiries of successor auditors and allow successor auditors to review working papers relating to matters of continuing accounting significance. The Memoranda, Reports, Maps, Drawings, Plans, Specifications, and other documents prepared by the CONSULTANT for this project, whether paper or electronic, shall become the property of the CITY for use with respect to this project, and shall be turned over to the CITY upon completion of the project, or any phase thereof, as contemplated by this Agreement. Contemporaneously with the transfer of documents, the CONSULTANT hereby assigns to the CITY, and CONSULTANT thereby expressly waives and disclaims any copyright in, and the right to reproduce, all written material, drawings, plans, specifications, or other work prepared under this Agreement, except upon the CITY'S prior authorization regarding reproduction, which authorization shall not be unreasonably withheld. The CONSULTANT shall, upon request of the CITY, execute any further document(s) necessary to further effectuate this waiver and disclaimer. The CONSULTANT agrees that the CITY may use, reuse, alter, reproduce, modify, assign, transfer, or in any other way, medium, or method utilize the CONSULTANT'S written work product for the CITY'S purposes, and the CONSULTANT expressly waives and disclaims any residual rights granted to it by Civil Code Sections 980 through 989 relating to intellectual property and artistic works. Any modification or reuse by the CITY of documents, drawings, or specifications prepared by the CONSULTANT shall relieve the CONSULTANT from liability under Section 14, but only with respect to the effect of the modification or reuse by the CITY, or for any liability to the CITY should the documents be used by the CITY for some project other than what was expressly agreed upon within the Scope of Services of this project, unless otherwise mutually agreed. 8. INDEPENDENT CONTRACTOR. Both parties hereto in the performance of this Agreement will be acting in an independent capacity and not as agents, employees, partners, or joint venturers with one another. Neither the CONSULTANT nor the CONSULTANT'S employees are employees of the CITY, and are not entitled to any of the rights, benefits, or privileges of the CITY'S employees, including but not limited to retirement, medical, unemploy- ment, or workers' compensation insurance. This Agreement contemplates the personal services of the CONSULTANT and the CONSULTANT'S employees, and it is recognized by the parties that a substantial inducement to the CITY for entering into this Agreement was, and is, the professional reputation and competence of the CONSULTANT and its employees. Neither this Agreement nor any interest herein may be assigned by the CONSULTANT without the prior written consent of the CITY. Nothing herein contained is intended to prevent the CONSULTANT from employing or Standard Agreement Page 3 of 11 City of National City and Revised July 2017 Pun Group, LLP hiring as many employees, or SUBCONSULTANTS, as the CONSULTANT may deem necessary for the proper and efficient performance of this Agreement. All agreements by CONSULTANT with its SUBCONSULTANT(S) shall require the SUBCONSULTANT(S) to adhere to the applicable terms of this Agreement. 9. CONTROL. Neither the CITY nor its officers, agents, or employees shall have any control over the conduct of the CONSULTANT or any of the CONSULTANT'S employees, except as herein set forth, and the CONSULTANT or the CONSULTANT'S agents, servants, or employees are not in any manner agents, servants, or employees of the CITY, it being understood that the CONSULTANT its agents, servants, and employees are as to the CITY wholly independent CONSULTANT, and that the CONSULTANT'S obligations to the CITY are solely such as are prescribed by this Agreement. 10. COMPLIANCE WITH APPLICABLE LAW. The CONSULTANT, in the performance of the services to be provided herein, shall comply with all applicable state and federal statutes and regulations, and all applicable ordinances, rules, and regulations of the City of National City, whether now in force or subsequently enacted. The CONSULTANT and each of its SUBCONSULTANT(S), shall obtain and maintain a current City of National City business license prior to and during performance of any work pursuant to this Agreement. 11. LICENSES, PERMITS, ETC. The CONSULTANT represents and covenants that it has all licenses, permits, qualifications, and approvals of whatever nature that are legally required to practice its profession. The CONSULTANT represents and covenants that the CONSULTANT shall, at its sole cost and expense, keep in effect at all times during the term of this Agreement, any license, permit, or approval which is legally required for the CONSULTANT to practice its profession. 12. STANDARD OF CARE. A. The CONSULTANT, in performing any services under this Agreement, shall perform in a manner consistent with that level of care and skill ordinarily exercised by members of the CONSULTANT'S trade or profession currently practicing under similar conditions and in similar locations. The CONSULTANT shall take all special precautions necessary to protect the CONSULTANT'S employees and members of the public from risk of harm arising out of the nature of the work and/or the conditions of the work site. B. Unless disclosed in writing prior to the date of this Agreement, the CONSULTANT warrants to the CITY that it is not now, nor has it for the five (5) years preceding, been debarred by a governmental agency or involved in debarment, arbitration or litigation proceedings concerning the CONSULTANT'S professional performance or the furnishing of materials or services relating thereto. C. The CONSULTANT is responsible for identifying any unique products, treatments, processes or materials whose availability is critical to the success of the project the CONSULTANT has been retained to perform, within the time requirements of the CITY, or, when no time is specified, then within a commercially reasonable time. Accordingly, unless the CONSULTANT has notified the CITY otherwise, the CONSULTANT warrants that all products, materials, processes or treatments identified in the project documents prepared for the CITY are reasonably commercially available. Any failure by the CONSULTANT to use due diligence under this sub -section will render the CONSULTANT liable to the CITY for any Standard Agreement Page 4 of 11 Revised July 2017 Pun Group, LLP City of National City and increased costs that result from the CITY'S later inability to obtain the specified items or any reasonable substitute within a price range that allows for project completion in the time frame specified or, when not specified, then within a commercially reasonable time. 13. NON-DISCRIMINATION PROVISIONS. The CONSULTANT shall not discriminate against any employee or applicant for employment because of age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. The CONSULTANT will take positive action to insure that applicants are employed without regard to their age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. Such action shall include but not be limited to the following: employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. The CONSULTANT agrees to post in conspicuous places available to employees and applicants for employment any notices provided by the CITY setting forth the provisions of this non-discrimination clause. 14. CONFIDENTIAL INFORMATION. The CITY may from time to time communicate to the CONSULTANT certain confidential information to enable the CONSULTANT to effectively perform the services to be provided herein. The CONSULTANT shall treat all such information as confidential and shall not disclose any part thereof without the prior written consent of the CITY. The CONSULTANT shall limit the use and circulation of such information, even within its own organization, to the extent necessary to perform the services to be provided herein. The foregoing obligation of this Section 14, however, shall not apply to any part of the information that (i) has been disclosed in publicly available sources of information; (ii) is, through no fault of the CONSULTANT, hereafter disclosed in publicly available sources of information; (iii) is already in the possession of the CONSULTANT without any obligation of confidentiality; or (iv) has been or is hereafter rightfully disclosed to the CONSULTANT by a third party, but only to the extent that the use or disclosure thereof has been or is rightfully authorized by that third party. The CONSULTANT shall not disclose any reports, recommendations, conclusions or other results of the services or the existence of the subject matter of this Agreement without the prior written consent of the CITY. In its performance hereunder, the CONSULTANT shall comply with all legal obligations it may now or hereafter have respecting the information or other property of any other person, firm or corporation. CONSULTANT shall be liable to CITY for any damages caused by breach of this condition, pursuant to the provisions of Section 15. 15. INDEMNIFICATION AND HOLD HARMLESS. The CONSULTANT agrees to defend, indemnify and hold harmless the City of National City, its officers, officials, agents, employees, and volunteers against and from any and all liability, loss, damages to property, injuries to, or death of any person or persons, and all claims, demands, suits, actions, proceedings, reasonable attorneys' fees, and defense costs, of any kind or nature, including workers' compensation claims, of or by anyone whomsoever, resulting from or arising out of the CONSULTANT'S performance or other obligations under this Agreement; provided, however, that this indemnification and hold harmless shall not include any claims or liability arising from the established sole negligence or willful misconduct of the CITY, its agents, officers, employees Standard Agreement Page 5 of 11 Revised July 2017 Pun Group, LLP City of National City and , or volunteers. CITY will cooperate reasonably in the defense of any action, and CONSULTANT shall employ competent counsel, reasonably acceptable to the City Attorney. The indemnity, defense, and hold harmless obligations contained herein shall survive the termination of this Agreement for any alleged or actual omission, act, or negligence under this Agreement that occurred during the term of this Agreement. 16. WORKERS' COMPENSATION. The CONSULTANT shall comply with all of the provisions of the Workers' Compensation Insurance and Safety Acts of the State of California, the applicable provisions of Division 4 and 5 of the California Labor Code and all amendments thereto; and all similar State or federal acts or laws applicable; and shall indemnify, and hold harmless the CITY and its officers, employees, and volunteers from and against all claims, demands, payments, suits, actions, proceedings, and judgments of every nature and description, including reasonable attorney's fees and defense costs presented, brought or recovered against the CITY or its officers, employees, or volunteers, for or on account of any liability under any of said acts which may be incurred by reason of any work to be performed by the CONSULTANT under this Agreement. 17. INSURANCE. The CONSULTANT, at its sole cost and expense, shall purchase and maintain, and shall require its SUBCONSULTANT(S), when applicable, to purchase and maintain throughout the term of this Agreement, the following insurance policies: A. ® If checked, Professional Liability Insurance (errors and omissions) with minimum limits of $1,000,000 per occurrence. B. Automobile Insurance covering all bodily injury and property damage incurred during the performance of this Agreement, with a minimum coverage of $1,000,000 combined single limit per accident. Such automobile insurance shall include non - owned and hired vehicles. The policy shall name the CITY and its officers, agents, employees, and volunteers as additional insureds, and a separate additional insured endorsement shall be provided. C. Commercial General Liability Insurance, with minimum limits of either $2,000,000 per occurrence and $4,000,000 aggregate, or $1,000,000 per occurrence and $2,000,000 aggregate with a $2,000,000 umbrella policy, covering all bodily injury and property damage arising out of its operations, work, or performance under this Agreement. The policy shall name the CITY and its officers, agents, employees, and volunteers as additional insureds, and a separate additional insured endorsement shall be provided. The general aggregate limit must apply solely to this "project" or "location". The "project" or "location" should be noted with specificity on an endorsement that shall be incorporated into the policy. D. Workers' Compensation Insurance in an amount sufficient to meet statutory requirements covering all of CONSULTANT'S employees and employers' liability insurance with limits of at least $1,000,000 per accident. In addition, the policy shall be endorsed with a waiver of subrogation in favor of the CITY. Said endorsement shall be provided prior to commencement of work under this Agreement. If CONSULTANT has no employees subject to the California Workers' Compensation and Labor laws, CONSULTANT shall execute a Declaration to that effect. Said Declaration shall be provided to CONSULTANT by CITY. E. The aforesaid policies shall constitute primary insurance as to the CITY, its officers, officials, employees, and volunteers, so that any other policies held by the CITY shall not contribute to any loss under said insurance. Said policies shall provide for thirty (30) Standard Agreement Page 6 of 11 Revised July 2017 Pun Group, LLP City of National City and days prior written notice to the CITY's Risk Manager, at the address listed in subsection G below, of cancellation or material change. F. If required insurance coverage is provided on a "claims made" rather than "occurrence" form, the CONSULTANT shall maintain such insurance coverage for three years after expiration of the term (and any extensions) of this Agreement. In addition, the "retro" date must be on or before the date of this Agreement. G. The Certificate Holder for all policies of insurance required by this Section shall be: City of National City c/o Risk Manager 1243 National City Boulevard National City, CA 91950-4397 H. Insurance shall be written with only insurers authorized to conduct business in Californiathat hold a current policy holder's alphabetic and financial size category rating of not less than A:VII according to the current Best's Key Rating Guide, or a company of equal financial stability that is approved by the CITY'S Risk Manager. In the event coverage is provided by non -admitted "surplus lines" carriers, they must be included on the most recent California List of Eligible Surplus Lines Insurers (LESLI list) and otherwise meet rating requirements. I. This Agreement shall not take effect until certificate(s) or other sufficient proof that these insurance provisions have been complied with, are filed with and approved by the CITY'S Risk Manager. If the CONSULTANT does not keep all of such insurance policies in full force and effect at all times during the terms of this Agreement, the CITY may elect to treat the failure to maintain the requisite insurance as a breach of this Agreement and terminate the Agreement as provided herein. J. All deductibles and self -insured retentions in excess of $10,000 must be disclosed to and approved by the CITY. K. If the CONSULTANT maintains broader coverage or higher limits (or both) than the minimum limits shown above, the CITY requires and shall be entitled to the broader coverage or higher limits (or both) maintained by the CONSULTANT. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the CITY. 18. LEGAL FEES. If any party brings a suit or action against the other party arising from any breach of any of the covenants or agreements or any inaccuracies in any of the representations and warranties on the part of the other party arising out of this Agreement, then in that event, the prevailing party in such action or dispute, whether by final judgment or out -of - court settlement, shall be entitled to have and recover of and from the other party all costs and expenses of suit, including attorneys' fees. For purposes of determining who is to be considered the prevailing party, it is stipulated that attorney's fees incurred in the prosecution or defense of the action or suit shall not be considered in determining the amount of the judgment or award. Attorney's fees to the prevailing party if other than the CITY shall, in addition, be limited to the amount of attorney's fees Standard Agreement Page 7 of 11 City of National City and Revised July 2017 Pun Group, LLP incurred by the CITY in its prosecution or defense of the action, irrespective of the actual amount of attorney's fees incurred by the prevailing party. 19. TERMINATION. A. This Agreement may be terminated with or without cause by the CITY. Termination without cause shall be effective only upon 60-day's written notice to the CONSULTANT. During said 60-day period the CONSULTANT shall perform all services in accordance with this Agreement. B. This Agreement may also be terminated immediately by the CITY for cause in the event of a material breach of this Agreement, misrepresentation by the CONSULTANT in connection with the formation of this Agreement or the performance of services, or the failure to perform services as directed by the CITY. C. Termination with or without cause shall be effected by delivery of written Notice of Termination to the CONSULTANT as provided for herein. D. In the event of termination, all finished or unfinished Memoranda Reports, Maps, Drawings, Plans, Specifications and other documents prepared by the CONSULTANT, whether paper or electronic, shall immediately become the property of and be delivered to the CITY, and the CONSULTANT shall be entitled to receive just and equitable compensation for any work satisfactorily completed on such documents and other materials up to the effective date of the Notice of Termination, not to exceed the amounts payable hereunder, and less any damages caused the CITY by the CONSULTANT'S breach, if any. Thereafter, ownership of said written material shall vest in the CITY all rights set forth in Section 7. E. The CITY further reserves the right to immediately terminate this Agreement upon: (1) the filing of a petition in bankruptcy affecting the CONSULTANT; (2) a reorganization of the CONSULTANT for the benefit of creditors; or (3) a business reorganization, change in business name or change in business status of the CONSULTANT. 20. NOTICES. All notices or other communications required or permitted hereunder shall be in writing, and shall be personally delivered; or sent by overnight mail (Federal Express or the like); or sent by registered or certified mail, postage prepaid, return receipt requested; or sent by ordinary mail, postage prepaid; or telegraphed or cabled; or delivered or sent by telex, telecopy, facsimile or fax; and shall be deemed received upon the earlier of (i) if personally delivered, the date of delivery to the address of the person to receive such notice, (ii) if sent by overnight mail, the business day following its deposit in such overnight mail facility, (iii) if mailed by registered, certified or ordinary mail, five (5) days (ten (10) days if the address is outside the State of California) after the date of deposit in a post office, mailbox, mail chute, or other like facility regularly maintained by the United States Postal Service, (iv) if given by telegraph or cable, when delivered to the telegraph company with charges prepaid, or (v) if given by telex, telecopy, facsimile or fax, when sent. Any notice, request, demand, direction or other communication delivered or sent as specified above shall be directed to the following persons: To CITY: Mark Roberts Director of Finance Department of Finance City of National City 1243 National City Boulevard Standard Agreement Page 8 of 11 Revised July 2017 Pun Group, LLP City of National City and National City, CA 91950-4397 To CONSULTANT: Kenneth H. Pun, CPA, CGMA Managing Partner The Pun Group, LLP 4365 Executive Drive, Suite 710 San Diego, CA 92121 Notice of change of address shall be given by written notice in the manner specified in this Section. Rejection or other refusal to accept or the inability to deliver because of changed address of which no notice was given shall be deemed to constitute receipt of the notice, demand, request or communication sent. Any notice, request, demand, direction or other communication sent by cable, telex, telecopy, facsimile or fax must be confirmed within forty- eight (48) hours by letter mailed or delivered as specified in this Section. 21. CONFLICT OF INTEREST AND POLITICAL REFORM ACT OBLIGATIONS. During the term of this Agreement, the CONSULTANT shall not perform services of any kind for any person or entity whose interests conflict in any way with those of the City of National City. The CONSULTANT also agrees not to specify any product, treatment, process or material for the project in which the CONSULTANT has a material financial interest, either direct or indirect, without first notifying the CITY of that fact. The CONSULTANT shall at all times comply with the terms of the Political Reform Act and the National City Conflict of Interest Code. The CONSULTANT shall immediately disqualify itself and shall not use its official position to influence in any way any matter coming before the CITY in which the CONSULTANT has a financial interest as defined in Government Code Section 87103. The CONSULTANT represents that it has no knowledge of any financial interests that would require it to disqualify itself from any matter on which it might perform services for the CITY. ® If checked, the CONSULTANT shall comply with all of the reporting requirements of the Political Reform Act and the National City Conflict of Interest Code. Specifically, the CONSULTANT shall file a Statement of Economic Interests with the City Clerk of the City of National City in a timely manner on forms which the CONSULTANT shall obtain from the City Clerk. The CONSULTANT shall be strictly liable to the CITY for all damages, costs or expenses the CITY may suffer by virtue of any violation of this Section 21 by the CONSULTANT. 22. PREVAILING WAGES. State prevailing wage rates may apply to work performed under this Agreement. State prevailing wages rates apply to all public works contracts as set forth in California Labor Code, including but not limited to, Sections 1720,1720.2, 1720.3, 1720.4, and 1771. Consultant is solely responsible to determine if State prevailing wage rates apply and, if applicable, pay such rates in accordance with all laws, ordinances, rules, and regulations. 23. MISCELLANEOUS PROVISIONS. A. Computation of Time Periods. If any date or time period provided for in this Agreement is or ends on a Saturday, Sunday or federal, state or legal holiday, then such date Standard Agreement Page 9 of 11 Revised July 2017 Pun Group, LLP City of National City and shall automatically be extended until 5:00 p.m. Pacific Time of the next day which is not a Saturday, Sunday or federal, state, or legal holiday. B. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute but one and the same instrument. C. Captions. Any captions to, or headings of, the sections or subsections of this Agreement are solely for the convenience of the parties hereto, are not a part of this Agreement, and shall not be used for the interpretation or determination of the validity of this Agreement or any provision hereof. D. No Obligations to Third Parties. Except as otherwise expressly provided herein, the execution and delivery of this Agreement shall not be deemed to confer any rights upon, or obligate any of the parties hereto, to any person or entity other than the parties hereto. E. Exhibits and Schedules. The Exhibits and Schedules attached hereto are hereby incorporated herein by this reference for all purposes. To the extent any exhibits,schedules, or provisions thereof conflict or are inconsistent with the terms and conditions contained in this Agreement, the terms and conditions of this Agreement shall control. F. Amendment to this Agreement. The terms of this Agreement may not be modified or amended except by an instrument in writing executed by each of the parties hereto. G. Waiver. The waiver or failure to enforce any provision of this Agreement shall not operate as a waiver of any future breach of any such provision or any other provision hereof. H. Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California. I. Audit. If this Agreement exceeds ten -thousand dollars ($10,000), the parties shall be subject to the examination and audit of the State Auditor for a period of three (3) years after final payment under the Agreement, per Government Code Section 8546.7. J. Entire Agreement. This Agreement supersedes any prior agreements, negotiations and communications, oral or written, and contains the entire agreement between the parties as to the subject matter hereof. No subsequent agreement, representation, or promise made by either party hereto, or by or to an employee, officer, agent or representative of any party hereto shall be of any effect unless it is in writing and executed by the party to be bound thereby. K. Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the successors and assigns of the parties hereto. L. Subcontractors or Subconsultants. The CITY is engaging the services of the CONSULTANT identified in this Agreement. The CONSULTANT shall not subcontract any portion of the work, unless such subcontracting was part of the original proposal or is allowed by the CITY in writing. In the event any portion of the work under this Agreement is subcontracted, the subconsultant(s) shall be required to comply with and agree to, for the benefit of and in favor of the CITY, both the insurance provisions in Section 17 and the indemnification and hold harmless provision of Section 15 of this Agreement. M. Construction. The parties acknowledge and agree that (i) each party is of equal bargaining strength, (ii) each party has actively participated in the drafting, preparation and negotiation of this Agreement, (iii) each such party has consulted with or has had the opportunity to consult with its own, independent counsel and such other professional advisors as such party has deemed appropriate, relative to any and all matters contemplated under this Agreement, (iv) each party and such party's counsel and advisors have reviewed this Agreement, (v) each party Standard Agreement Page 10 of 11 Revised July 2017 Pun Group, LLP City of National City and has agreed to enter into this Agreement following such review and the rendering of such advice, and (vi) any rule or construction to the effect that ambiguities are to be resolved against the drafting party shall not apply in the interpretation of this Agreement, or any portions hereof, or any amendments hereto. IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date and year first above written. CITY OF NATIONAL CITY By: on Morrison, Mayor APPROVED AS TO FORM: Angil P. Morris -Jones City Attorney By: RoHerto M. Contreras Deputy City Attorney Standard Agreement Revised July 2017 THE PUN GROUP, LLP (Corporation — signatures of two corporate officers required) (Partnership or Sole proprietorship — one signature) By: By: Page 11 of 11 (Name) (Print) (Title) City of National City and Pun Group, LLP Exhibit A Scope of Work A. The Consultant will be required to perform the following tasks: 1. audit of all funds of the City in accordance with the United States Government Accountability Office's Generally Accepted Government Auditing Standards; 2. preparation, including word processing, of the City's CAFR and the financial statements of its component units in compliance with applicable GASB statements; 3. Gann limit review pertaining to the City's appropriation limit, rendering a letter annually regarding compliance; 4. City-wide audit of the expenditures of federal grants in accordance with Uniform Guidance and preparation of the appropriate reports, testing two (2) major programs, including the Housing Choice Voucher Program ("HCVP"); 5. financial and compliance audit of the Successor Agency to the Community Development Commission as the National City Redevelopment Agency ("Successor Agency") including Kimball Towers; 6. separate United States Department of Housing and Urban Development (HUD) required single audit of Morgan Towers in accordance with Uniform Guidance; 7. commission single audit of federal grants allocable to HCVP in accordance with Uniform Guidance; and 8. Real Estate Assessment Center electronic submission to HUD and related attestations. B. Additional Services: 1. compile the Annual State Controller's Report for the City; and 2. serve as a resource and provide training to professional accounting staff on preparation of financial statements and best practices in conformance with applicable laws and governmental accounting standards. 3. provide on -going, infrequent consulting services for financial issues that may occur throughout the year. No additional charges are to be made by the Consultant for these financial consulting services. C. Auditing Standards to be followed: The Consultant shall review the financial records and all the various funds of the City and prepare all the financial statements in conformance with: 1. generally accepted auditing standards as set forth by the American Institute of Certified Public Accountants (AICPA); 2. the standards applicable to financial audits contained in Government Auditing Standards (2011 revision) issued by the Comptroller General of the United States; 3. the provisions of the Single Audit Act of 1996 and the provisions of Uniform Guidance; and 4. all applicable GASB statements. D. Reports to be Issued: Following the completion of the audit of the fiscal year's financial statements, the Consultant shall issue: 1. a report on the fair presentation of the financial statements in conformity with generally accepted accounting principles for all entities listed above; 2. a report on compliance and on the internal control over financial reporting based on an audit of financial statements performed in accordance with Government Auditing Standards; 3. a report on compliance with requirements applicable to each major program and internal control over compliance in accordance with Uniform Guidance (Single Audit); 4. a schedule of Expenditures of Federal Awards together with applicable notes to this schedule (Single Audit); 5. a schedule of findings and questioned costs (Single Audit); Page 1 of 5 City of National City and Pun Group, LLP Exhibit A 6. status of prior year findings (Single Audit); and 7. Form SF -SAC, Data Collections Form for Reporting of Audits of States, Local Governments and Non - Profit Organizations. 8. In the required reports on internal controls the Consultant 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 financial statements. Reportable conditions that are also material weaknesses shall be identified as such in the report. Non -reportable conditions discovered by the Consultant shall be reported in a separate letter to management, which shall be referred to in the reports on internal controls. The reports on compliance shall include all instances of noncompliance. E. Irregularities and Illegal Acts The Consultant 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 City Council, City Manager, City Attorney, and Director of Finance. F. Special Requirements 1. Budget In accordance with provisions of the municipal code of the City, it is the duty of the City Manager to prepare and submit to the City Council the annual budget and such reports as may be required by that body. The Consultant shall examine the final budget document (http://www.nationalcityca.gov) as approved by the City Council and compare the estimated revenues and appropriations as shown in the budget document with the entries recorded on the revenue ledger and the appropriation ledger maintained by the Department of Finance. 2. Funds The Consultant shall examine City ordinances or resolutions, and minutes of the City Council pertaining to all funds of the City to determine the purpose of each fund and the proper disposition of all funds revenues, expenditures, and year-end balances. The Consultant shall examine the various fund transactions and balances in each fund and prepare the appropriate financial statements for the audit report. The Consultant shall review the City's municipal code Chapter 4.04.010 — Funds. The Consultant shall advise regarding the necessary funds and designation as established by the aforementioned municipal code. 3. Verification of Cash and Securities a. Cash and Checks: The Consultant shall count all cash and checks in the Department of Finance as of June 30. The Consultant shall subsequently be satisfied that all items counted and verified are deposited in the City's depository bank. Investment securities owned by the City and held in safekeeping by the City's various banks and financial institutions shall be verified as to their existence as of June 30. Written confirmation shall be obtained from all City depositories of balance on hand at June 30. b. Surprise Cash Counts: The Consultant shall make, during the year, at least two surprise cash counts of the funds in the Department of Finance in cooperation with staff members. c. Collateral Pledged for Funds on Deposit: The Consultant shall examine the records of pledged collateral and make such tests of depository bank pooled collateral operations as may be necessary to express an opinion as to the legal sufficiency of the collateral to safeguard the City's bank deposits. Page 2 of 5 City of National City and Pun Group, LLP Exhibit A d. Accounting Records: The Consultant shall examine the City's internal accounting and administrative controls to determine that accounting procedures are adequate to safeguard assets and provide reasonable assurance of proper recording of financial transactions. 4. Assets a. Cash and Investments: Treasury and investment operations are the responsibility of the Department of Finance and the City Treasurer. The Consultant shall verify the cash balances and the existence of the investments. The investments market value shall be reviewed and compared to book value. The Consultant shall review balances as of June 30 and investments earnings recorded during the fiscal year. The footnote disclosure shall be in compliance with the corresponding GASB statements. b. Fixed Assets: The Consultant shall examine the procedures for recording the acquisition of and the disposal of property owned by the City. The Consultant shall compare the annual inventories of property with the controls maintained by the Department of Finance. The Consultant shall review the transactions involving fixed assets to the extent necessary to assure that accountability for fixed assets is maintained. 5. Liabilities a. Accounts Payable: The Consultant shall make a sufficient examination of accounts payable to enable them to determine that, in general, they bear evidence of verification and approval with supporting documents such as purchase orders, vendor's invoices, receiving reports, transportation bills, contracts and other documents where necessary. The Consultant shall also be satisfied that the claims were charged against the proper departmental appropriations and that funds were available at the date the purchase was made. b. Bonded Debt: The Consultant shall examine the amount of bonded debt of the City and the outstanding debt determined by the Consultant, and it should be reconciled to the accounting records of the City by fund and amount outstanding as of June 30. c. Other Liabilities and Deferred Credits: The Consultant shall be satisfied as to the fairness of the accounts representing other liabilities and deferred credits. 6. Fund Balances The Consultant shall examine revenues and expenditures by funds and analyze the changes in fund balances for the financial statement of each fund in the audit report. 7. Single Audit Act The Consultant shall perform a financial and compliance audit under the Single Audit Act of 1996 and in accordance with OMB Uniform Guidance. The Single Audit Report will include the schedule of expenditures of federal awards, footnotes, findings, and questioned costs, including reportable conditions and material weaknesses, and follow up on prior year audit findings, if applicable. The Single Audit Report is not to be included in the CAFR, but is to be issued separately. G. Audit Schedule; Entrance Conference, Progress Reporting and Exit Conferences; Audit Presentation Page 3 of 5 City of National City and Pun Group, LLP Exhibit A The Consultant shall provide the City with an audit plan and a list of schedules to be prepared by City personnel prior to the beginning of fieldwork. Interim fieldwork would be expected to be performed in May of each year with the final phase of fieldwork commencing in October of each year. The City will attempt to have the books closed and all agreed upon schedules available for the Consultant by September 30 of each year. The Consultant shall have drafts of the final reports and recommendations to management available for review by the Director of Finance by the following date(s): • November 30 of each year or the first business day thereafter if November 30 is not a normal business day. An entrance conference should be scheduled prior to beginning interim fieldwork. Progress reports are expected on at least a monthly basis to the Director of Finance. An exit conference to summarize the results of fieldwork and to review significant findings is expected on the last day of fieldwork or shortly thereafter. The Consultant will be required to present the City financial statements to the City Council. H. Final Reports The Department of Finance will complete their review of the draft report as expeditiously as possible. This process is not expected to exceed two weeks. During that period, the Consultant should be available for any meetings that may be necessary to discuss the drafts. Once all issues for discussion are resolved, the final signed report shall be delivered to the Director of Finance within ten working days. It is anticipated that this process will be completed and the final reports delivered by the following dates: December 31 of each year. The Consultant is responsible for the printing, binding and delivery of the following copies of each audit reports: • 20 copies — City of National City CAFR • 10 copies — Single Audit Report • 5 copies — Separate HUD single audit of Morgan Towers In addition to the final hard copies listed above an electronic version of the report is to be provided in an Adobe Acrobat PDF format (with optical character recognition (OCRJ) and an unbound reproducible master. I. Assistance to be provided to Consultant and Report Preparation 1. Department of Finance Assistance The Department of Finance staff and responsible management personnel will be available during the audit to assist Consultant by providing information, documentation and explanations. The preparation of confirmations will be the responsibility of City, with the assistance of the Consultant. City staff will assist Consultant in identifying and locating supporting documentation. Consultant may be responsible for pulling some files and refiling them depending on the items requested. 2. Information Technology Services (ITS) Assistance Page 4 of 5 City of National City and Pun Group, LLP Exhibit A Information Technology Service Department personnel will be available to provide system's documentation and explanations. The Consultant will be provided computer time and the use of the City's computer hardware and software. 3. Statements and Schedules to be prepared by City Staff The City will prepare the following statements and schedules for the Consultant. Additional statements or schedules may be prepared if mutually agreed upon in advance. a. General Purpose Financial Statements o Cash and Investments o Cash with Fiscal Agent/Trustee o Schedule of Investments o Interest receivable o Schedule of transfers -in and transfers -out o Schedule of Fixed Asset o Compensated Absences o Insurance and claims payable schedule o Schedule of Long-term Debt o Bank Reconciliation o Loans Receivable & Payable - o Accounts Receivable & Accounts Payable o Advances Receivable & Payable between Funds o Schedule of fund balance classification o CaIPERS Actuarial Valuation Report and Accounting Valuation Report b. Single Audit Schedule of Expenditures of Federal Awards (SEFA) 4. Work Area, Telephones, Photocopying and FAX Machines The City will provide the Consultant with reasonable work space, desks and chairs. The Consultant will also be provided with access to a telephone line, photocopying machine and FAX machine. Page 5 of 5 Exhibit B Compensation and Payments Services to be rendered FY 2018 FY 2019 FY 2020 FY 2021' FY 2022' City Audit, including CAFR Single Audit - 2 Major Programs GANN Limit Annual State Controller's Report Financial and Compliance Audit of CDC, including Kimball Towers Separate HUD - Required Single Audit Morgan Towers Commission Single Audit of Federal Grants Allocable to Housing Choice Voucher Program REAC Electronic Submission to HUD and Related Attestations 31,000 31,620 32,252 32,897 33,555 8,000 8,160 8,323 8,490 8,659 Included Included Included Included Included 4,500 4,590 4,682 4,775 4,871 7,000 7,140 7,283 7,428 7,577 7,000 7,140 7,283 7,428 7,577 3,500 3,570 3,641 3,714 3,789 Included Included Included Included Included Total for Fiscal Year (not -to -exceed) 61,000 62,220 63,464 64,732 66,028 Standard Billing Rates (per hour) Position FY 2018 FY 2019 FY 2020 FY 2021' FY 2022' Partners Managers Supervisor Senior Accountants Staff Accountants Clerical 250 258 265 273 281 200 206 212 219 225 175 180 186 191 197 150 155 159 164 169 125 129 133 141 141 100 103 106 113 113 Invoice Payments2 Work Performed % of Proposal Amount For Planning 10% For Interim Work 40% For Year -End Work 40% At Presentation and Acceptance of Final Reports 10% Total 100% ' The City has the option to extend the agreement under the same terms and conditions for year 4 and year 5. 2 Invoices will cover a period at least one calendar month. The invoices will be charge for work performed based on the percentage of the proposal amount as shown above. r 1 a ACORD CERTIFICATE OF LIABILITY INSURANCE DATE (MMIDDIYYYY) 6/20/2018 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. IMPORTANT: If the certificate holder Is an ADDITIONAL INSURED, the policy(les) must be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder In lieu of such endorsement(s). PRODUCER Wood Gutmann & Bogart 15901 Red Hill Ave., Suite 100 Tustin CA 92780 CONTACT Connie Jones PHONE FAX (AIC, No, Ext): 714-505-7000 (A/C, No): 714-573-1770 ADDRESS: Connie@wgbib.com INSURER(S) AFFORDING COVERAGE NAIC # INSURER : TRAVELERS CAS INS CO OF AMER 19046 INSURED PUN&M-1 The Pun Group, LLP 200 East Sandpointe Avenue, Suite 600 Santa Ana CA 92707 INSURER B : Travelers Property Casualty Co of Amer 25674 INSURER C: Argonaut Insurance Company INSURER : INSURER E : INSURER F : COVERAGES CERTIFICATE NUMBER: 714984331 REVISION NUMBER: THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS INSR LTR TYPE OF INSURANCE ADDL INSD SUBR WVD POLICY NUMBER POLICY EFF (MMIDDIWYYI POLICY EXP (MMIDDIWYY) LIMITS A X COMMERCIAL GENERAL LIABILITY 6807G592120-18 3/1/2018 3/1/2019 EACH OCCURRENCE $ 2,000,000 PREM SES Ea occurrence) $ 300,000 CLAIMS -MADE X OCCUR MED EXP (My one person) $ 5,000 PERSONAL & ADV INJURY $ 2,000,000 GENERAL AGGREGATE $4,000,000 GEN'L AGGREGATE X LIMIT APPLIES PCT PER: LOC PRODUCTS - COMP/OP AGG $ 4,000,000 $ A AUTOMOBILE _ X LIABILITY ANY AUTO ALL OWNED AUTOS X SCHEDULED AUTOS AUTOS ED BA-8G97670318 3/1/2018 3/1/2019 COMBINED SINGLE LIMIT (Ea accident) $ 1,000,000 BODILY INJURY (Per person) $ BODILY INJURY (Per accident) $ PROPERTY DAMAGE (Per accdent) $ B X UMBRELLA LIAB EXCESS LIAB X OCCUR CLAIMS -MADE CUP-004H25314818 3/1/2018 3/1/2019 EACH OCCURRENCE $ 1,000,000 AGGREGATE $ 1,000,000 $ DED RETENTION $ B WORKERS COMPENSATION AND EMPLOYERS' LIABILITY Y IN ANY PROPRIETOR/PARTNER/EXECUTIVE ❑ OFFICER/MEMBER EXCLUDED? (Mandatory In NH) If yes, describe under DESCRIPTION OF OPERATIONS below N!A UB3K65340118 3/12018 3/1/2019 X STATUTE OTH- ER E.L. EACH ACCIDENT $ 1,000,000 E.L. DISEASE - EA EMPLOYEE $ 1,000,000 E.L. DISEASE - POLICY LIMIT $ 1,000,000 C E&O Retro 12/29/11 IAC4207440 3/1/2018 3/12019 3,000,000 agg 1,000,000 DESCRIPTION OF OPERATIONS 1 LOCATIONS 1 VEHICLES (ACORD 101, Additional Remarks Schedule, may be attached If more space Is requi ed) The City of National City, its elected officials, officers, agents and employees are named as additional insureds per written contract agreement and the attached forms CERTIFICATE HOLDER CANCELLATION City of National City c/o Risk Manager 1243 National City Blvd. National City CA 91950 SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS. AUTHORIZED REPRESENTATIVE ACORD 25 (2014/01) ® 1988-2014 ACORD CORPORATION. All rights reserved. The ACORD name and logo are registered marks of ACORD POLICY NUMBER: 680-7G592120-18-42 COMMERCIAL GENERAL LIABILITY ISSUE DATE: 01/12/2018 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. ADDITIONAL INSURED -DESIGNATED PERSON OR ORGANIZATION This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART SCHEDULE Name of person or organization: City of National City, its elected officials, officers agents and employees c/o Risk Manager 1243 National City Blvd National City, Ca. 91950 WHO IS AN INSURED (Section II) is amended to include as an insured the person or organization shown in the Schedule as an insured but only with respect to liability arising out of your acts or omissions. CGT4911188 Copyright, Insurance Services Office, Inc., 1984 Page 1 of 1 COMMERCIAL GENERAL LIABILITY THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. XTEND ENDORSEMENT This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART GENERAL DESCRIPTION OF COVERAGE — This endorsement broadens coverage. The following listing is a general coverage description only. Limitations and exclusions may apply to these coverages. Read all the PRO- VISIONS of this endorsement carefully to determine rights, duties, and what is and is not covered. A. Broadened Named Insured B. Damage To Premises Rented To You Extension • Perils of fire, explosion, lightning, smoke, water • Limit increased to $300,000 C. Blanket Waiver of Subrogation D. Blanket Additional Insured— Managers or Lessors of Premises E. Blanket Additional Insured — Lessor of leased Equipment F. Incidental Medical Malpractice G. Personal Injury — Assumed by Contract H. Extension of Coverage — Bodily Injury PROVISIONS A. BROADENED NAMED INSURED 1. The Named Insured in Item 1. of the Declara- tions is as follows: The person or organization named in Item 1. of the Declarations and any organization, other than a partnership or joint venture, over which you maintain ownership or majority in- terest on the effective date of the policy. However, coverage for any such organization will cease as of the date during the policy pe- riod that you no longer maintain ownership of, or majority interest in, such organization. 2. WHO IS AN INSURED (Section II) Item 4.a. is deleted and replaced by the following: a. Coverage under this provision is afforded only until the 180th day after you acquire or form the organization or the end of the policy period, whichever is earlier, unless reported in writing to us within 180 days. 3. This Provision A. does not apply to any per- son or organization for which coverage is ex- cluded by endorsement. I. Injury to Co -Employees and Co -Volunteer Workers J. Aircraft Chartered with Crew K. Non -Owned Watercraft — Increased from 25 feet to 50 feet L. Increased Supplementary Payments • Cost for bail bonds increased to $2,500 • Loss of earnings increased to $500 per day M. Knowledge and Notice of Occurrence or Offense N. Unintentional Omission O. Reasonable Force — Bodily Injury or Property Damage B. DAMAGE TO PREMISES RENTED TO YOU EXTENSION 1. The last paragraph of COVERAGE A. BOD- ILY INJURY AND PROPERTY DAMAGE LI- ABILITY (Section I — Coverages) is deleted and replaced by the following: Exclusions c. through n. do not apply to dam- age to premises while rented to you, or tem- porarily occupied by you with permission of the owner, caused by: a. Fire; b. Explosion; c. Lightning; d. Smoke resulting from such fire, explosion, or lightning; or e. Water. A separate limit of insurance applies to this coverage as described in LIMITS OF INSUR- ANCE (Section III). 2. This insurance does not apply to damage to premises while rented to you, or temporarily CG D1 86 11 03 Copyright, The Travelers Indemnity Company, 2003 Page 1 of 5 COMMERCIAL GENERAL LIABILITY occupied by you with permission of the owner, caused by: a. Rupture, bursting, or operation of pres- sure relief devices; b. Rupture or bursting due to expansion or swelling of the contents.of any building or structure, caused by or resulting from wa- ter; c. Explosion of steam boilers, steam pipes, steam engines, or steam turbines. 3. Part 6. of LIMITS OF INSURANCE (Section III) is deleted and replaced by the following: Subject to 5. above, the Damage To Prem- ises Rented To You Limit is the most we will pay under COVERAGE A. for damages be- cause of "property damage" to any one prem- ises while rented to you, or temporarily occu- pied by you with permission of the owner, caused by fire, explosion, lightning, smoke resulting from such fire, explosion, or light- ning, or water. The Damage To Premises Rented To You Limit will apply to all damage proximately caused by the same "occur- rence", whether such damage results from fire, explosion, lightning, smoke resulting from such fire, explosion, or lightning, or water, or any combination of any of these. The Damage To Premises Rented To You Limit will be the higher of: a. $300,000; or b. The amount shown on the Declarations for Damage To Premises Rented To You Limit. 4. Under DEFINITIONS (Section V), Paragraph a. of the definition of "insured contract" is amended so that it does not include that por- tion of the contract for a lease of premises that indemnifies any person or organization for damage to premises while rented to you, or temporarily occupied by you with permis- sion of the owner, caused by: a. Fire; b. Explosion; c. Lightning; d. Smoke resulting from such fire, explosion, or lightning; or e. Water. 5. This Provision B. does not apply if coverage for Damage To Premises Rented To You of COVERAGE A. BODILY INJURY AND PROPERTY DAMAGE LIABILITY (Section I — Coverages) is excluded by endorsement. C. BLANKET WAIVER OFSUBROGATION We waive any right of recovery we may have against any person or organization because of payments we make for injury or damage arising out of premises owned or occupied by or rented or loaned to you; ongoing operations performed by you or on your behalf, done under a contract with that person or organization; "your work'; or "your products", We waive this right where you have agreed to do so as part of a written contract, executed by you prior to loss. D. BLANKET ADDITIONAL INSURED — MANAG- ERS OR LESSORS OF PREMISES WHO IS AN INSURED (Section II) is amended to include as an insured any person or organization (referred to below as "additional insured") with whom you have agreed in a written contract, exe- cuted prior to loss, to name as an additional in- sured, but only with respect to liability arising out of the ownership, maintenance or use of that part of any premises leased to you, subject to the fol- lowing provisions: 1. Limits of Insurance. The limits of insurance afforded to the additional insured shall be the limits which you agreed to provide, or the lim- its shown on the Declarations, whichever is less. 2. The insurance afforded to the additional in- sured does not apply to: a. Any "occurrence" that takes place after you cease to be a tenant in that premises; b. Any premises for which coverage is ex- cluded by endorsement; or c. Structural alterations, new construction or demolition operations performed by or on behalf of such additional insured. 3. The insurance afforded to the additional in- sured is excess over any valid and collectible insurance available to such additional in- sured, unless you have agreed in a written contract for this insurance to apply on a pri- mary or contributory basis. E. BLANKET ADDITIONAL INSURED — LESSOR OF LEASED EQUIPMENT WHO IS AN INSURED (Section II) is amended to include as an insured any person or organization (referred to below as "additional insured") with Page 2 of 5 Copyright, The Travelers Indemnity Company, 2003 CG D1 8611 03 COMMERCIAL GENERAL LIABILITY whom you have agreed in a written contract, exe- cuted prior to loss, to name as an additional in- sured, but only with respect to their liability arising out of the maintenance, operation or use by you of equipment leased to you by such additional in- sured, subject to the following provisions: 1. Limits of Insurance, The limits of insurance afforded to the additional insured shall be the limits which you agreed to provide, or the lim- its shown on the Declarations, whichever is less. 2. The insurance afforded to the additional in- sured does not apply to: a. Any "occurrence" that takes place after the equipment lease expires; or b. "Bodily injury" or "property damage" aris- ing out of the sole negligence of such ad- ditional insured. 3. The insurance afforded to the additional in- sured is excess over any valid and collectible insurance available to such additional in- sured, unless you have agreed in a written contract for this insurance to apply on a pri- mary or contributory basis. F. INCIDENTAL MEDICAL MALPRACTICE 1. The definition of "bodily injury" in DEFINI- TIONS (Section V) is amended to include "In- cidental Medical Malpractice Injury". 2. The following definition is added to DEFINI- TIONS (Section V): "Incidental medical malpractice injury" means bodily injury, mental anguish, sickness or dis- ease sustained by a person, including death resulting from any of these at any time, aris- ing out of the rendering of, or failure to ren- der, the following services: a. Medical, surgical, dental, laboratory, x-ray or nursing service or treatment, advice or instruction, or the related furnishing of food or beverages; b. The furnishing or dispensing of drugs or medical, dental, or surgical supplies or appliances; or c. First aid. d. "Good Samaritan services". As used in this Provision F., "Good Samaritan ser- vices" are those medical services ren- dered or provided in an emergency and for which no remuneration is demanded or received. 3. Paragraph 2.a.(1)(d) of WHO IS AN IN- SURED (Section II) does not apply to any registered nurse, licensed practical nurse, emergency medical technician or paramedic employed by you, but only while performing the services described in paragraph 2. above and while acting within the scope of their em- ployment by you. Any "employees" rendering "Good Samaritan services" will be deemed to be acting within the scope of their employ- ment by you. 4. The following exclusion is added to paragraph 2. Exclusions of COVERAGE A. — BODILY INJURY AND PROPERTY DAMAGE LIABIL- ITY (Section I — Coverages): (This insurance does not apply to) Liability arising out of the willful violation of a penal statute or ordinance relating to the sale of pharmaceuticals by or with the knowledge or consent of the insured. 5. For the purposes of determining the applica- ble limits of insurance, any act or omission, together with all related acts or omissions in the furnishing of the services described in paragraph 2. above to any one person, will be considered one "occurrence". 6. This Provision F. does not apply if you are in the business or occupation of providing any of the services described in paragraph 2. above. 7. The insurance provided by this Provision F. shall be excess over any other valid and col- lectible insurance available to the insured, whether primary, excess, contingent or on any other basis, except for insurance pur- chased specifically by you to be excess of this policy. G. PERSONAL INJURY — ASSUMED BY CON- TRACT 1. The Contractual Liability Exclusion in Part 2., Exclusions of COVERAGE B. PER- SONAL AND ADVERTISING INJURY LIABIL- ITY (Section I — Coverages) is deleted and replaced by the following: (This insurance does not apply to:) Contractual Liability "Advertising injury" for which the insured has assumed liability in a contract or agreement. This exclusion does not apply to liability for CG D1 86 11 03 Copyright, The Travelers Indemnity Company, 2003 Page 3 of 5 POLICY NUMBER: 680-7G592120-17-42 COMMERCIAL GENERAL LIABILITY ISSUE.DATE: 09/21/2017 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY TOTAL GENERAL AGGREGATE LIMIT DESIGNATED PROJECT(S) - GENERAL AGGREGATE LIMIT This endorsement modifies Insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART SCHEDULE Total General Aggregate Limit: $ 4,000,000 Designated Project(s): Each "project" for which you have agreed, in a written contract which is in effect during this policy period, to provide a separate General Aggregate Limit; provided that, the contract is signed and executed prior to any Toss for which coverage is sought. (If no entry appears above, information required to complete this endorsement will be shown in the Declarations as applicable to this endorsement.) A. The Total General Aggregate Limit stated in the Schedule above is the most we will pay for the sum of all: 1. Medical Expenses under COVERAGE C (SECTION I); 2. Damages under COVERAGE A (SECTION I), except damages because of '`bodily injury" or "property damage" included in the "products - completed operations hazard"; and 3. Damages under COVERAGE B (SECTION I) regardless of the number of: a. Insureds; b. Claims made or "suits" brought; c. Persons or organizations making claims or bringing "suits"; or d. Designated "projects" in the SCHEDULE above. B. For all sums which the insured becomes legally obligated to pay as damages caused by "occur- rences" under COVERAGE A (SECTION II), and for all medical expenses caused by accidents under COVERAGE C (SECTION I), which can be attributed only to operations at a single desig- nated "project" shown in the Schedule above: 1. A separate Designated Project General Ag- gregate Limit applies to each designated "project", and that limit is equal to the amount of the General Aggregate Limit shown in the Declarations. 2. Subject to the Total General Aggregate Limit stated in the Schedule above, the Designated Project General Aggregate Limit is the most we will pay for the sum of all damages under COVERAGE A, except damages because of "bodily injury" or "property damage" included in the "products -completed operations haz- ard", and for medical expenses under COVERAGE C regardless of the number of: a. Insureds; b. Claims made or "suits" brought; or CG M1 06 06 06 0 2005 The Travelers Companies, Inc. Page 1 of 2 COMMERCIAL AUTO POLICY NUMBER: BA-8G976703 -18 -SEL ISSUE DATE: 01-12-18 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. DESIGNATED INSURED FOR COVERED AUTOS LIABILITY COVERAGE This endorsement modifies insurance provided under the following: AUTO DEALERS COVERAGE FORM BUSINESS AUTO COVERAGE FORM MOTOR CARRIER COVERAGE FORM With respect to coverage provided by this endorsement, the provisions of the Coverage Form apply unless modi- fied by this endorsement. This endorsement identifies person(s) or organization(s) who are "insureds" for Covered Autos Liability Coverage under the Who Is An Insured provision of the Coverage Form. This endorsement does not alter coverage pro- vided in the Coverage Form. SCHEDULE Name Of Person(s) Or Organization(s): SEE FORM NO CA T8 05 03 17 Information required to complete this Schedule, if not shown above, will be shown in the Declarations. Each person or organization shown in the Schedule is an "insured" for Covered Autos Liability Coverage, but only to the extent that person or organization qualifies as an "insured" under the Who is An Insured provi- sion contained in Paragraph Al. of Section 11 — Cov- ered Autos Liability Coverage in the Business Auto and Motor Carrier Coverage Forms and Paragraph D.2. of Section 1 — Covered Autos Coverages of the Auto Dealers Coverage Form. CA20481013 © Insurance Services Office, Inc., 2011 Page 1 of 1 COMMERCIAL AUTO POLICY ENDORSEMENT - CA T8 05 03 18 POLICY NUMBER BA-8G9767d3-18-SEL ** THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. ** SEE FORM NO CA 20 48 10 13 IT IS AGREED THAT: City of National City, it's elected officials, agents and employees c/o Risk Manager 1243 National City Blvd. National City, Ca. 91950 EFFECTIVE DATE 03-01-18 EXPIRATION DATE 03-01-19 PAGE 0001 DATE OF ISSUE 01-12-18 TRAVELERSJ ONE TOWER SQUARE HARTFORD CT 06183 WORKERS COMPENSATION AND EMPLOYERS LIABILITY POLICY ENDORSEMENT WC 04 03 06 (01) — 0 02 POLICY NUMBER; trs-31(653401-18-42-G WAIVER OF OUR RIGHT TO RECOVER FROM OTHERS ENDORSEMENT-CALIFORNIA We have the right to recover our payments from anyone liable for an injury covered by this policy. We will not enforce our right against the person or organization named in the Schedule. (This agreement applies only to the extent that you perform work under a written contract that requires you to obtain this agreement from us.) You must maintain payroll records accurately segregating the remuneration of your employees while engaged in the work described in the Schedule. THE ADDITIONAL PREMIUM FOR THIS ENDORSEMENT SHALL BE 5.00% OF THE CALIFORNIA WORKERS' COMPENSATION PREMIUM OTHERWISE DUE ON SUCH REMUNERATION, SCHEDULE PERSON OR ORGANIZATION City of National City c/o Risk Mnager 1243 National City Blvd. National City, Ca. 91950 JOB DESCRIPTION Accounting Services DATE OF- ISSUE: 01-12-18 ST ASSIGN: Page 1 of Javier Carcamo From: Mike Gomez Sent: Thursday, June 21, 2018 9:36 AM To: Javier Carcamo Cc: Robby Contreras; Mark Roberts Subject: The Pun Group - Review of the Proposed Agreement, Certificate of Liability Insurance and Supporting Additional Insured Endorsements Attachments: The Pun Group - Proposed Agreement.docx; The Pun Group - Certificate of Liability Insurance and Supporting Additional Insured Endorsements.pdf I have reviewed the attached documents and am of the opinion that the consultant has complied substantially with the requirements as set out in the proposed agreement. However, there should be a modification made to Line 17 B that should state "Such automobile insurance shall include non -owned and hired vehicles". This modification to the agreement presupposes that the consultant does not own any automobiles. I trust that this review is responsive to your request. I would like to thank you for your time and efforts in this matter. Should you have any questions or concerns, please feel free to contact me. Michael Gomez Risk Manager (619) 336-4370 CONFIDENTIALITY NOTICE The contents of this e-mail message and any attachments are confidential and are intended solely for addressee. The information may also be legally privileged. This transmission is sent in trust, for the sole purpose of delivery to the intended recipient. If you have received this transmission in error, any use, reproduction or dissemination of this transmission is strictly prohibited. If you are not the intended recipient, please immediately notify the sender by reply e-mail or phone at (619) 336-4370 and delete this message and its attachments, if any. From: Javier Carcamo Sent: Thursday, June 21, 2018 8:05 AM To: Mike Gomez Cc: Robby Contreras; Mark Roberts Subject: Insurance Approval Importance: High Dear Mike Gomez, We are attempting to include the award for audit services agreement into the 07/03 City Council Meeting. We have asked our vendor, The Pun Group, LLP, to rush a request to their insurance carrier to furnish the City the Certificate of Liability Insurance, and the additional endorsements in accordance with our insurance requirements. Attached are the insurance documents for your review along with the redline version of the agreement. The agreement has been submitted to the City Attorney's Office for their review and approval. If you need anything else, please let me know so that I can quickly submit a request to the vendor and/or their insurance provider. Thank you, 1 Javier Carcamo Financial Services Officer City of National City Department of Finance 1243 National City Boulevard National City, CA 91950-4301 Phone Office 1.619.336.4331 Email: JCarcamo(anationalcityca.gov Website: http://www.nationalcityca.gov 2 RESOLUTION NO. 2018 — 122 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY AUTHORIZING THE MAYOR TO EXECUTE AN AGREEMENT WITH THE PUN GROUP, LLP FOR INDEPENDENT AUDITING SERVICES FOR THE FISCAL YEARS ENDING JUNE 30, 2018 TO JUNE 30, 2020 WITH THE OPTION TO EXTEND THE AGREEMENT FOR EACH OF THE TWO (2) SUBSEQUENT FISCAL YEARS WHEREAS, on April 26, 2018, the City posted a Request for Proposals ("RFP") for professional audit services and received seven (7) proposals in response by the May 14, 2018 deadline; and WHEREAS, after reviewing and considering each proposal and the information received during oral presentations and interview, the evaluation committee selected The Pun Group, LLP as the highest-ranking firm to provide independent auditing services to the City; and WHEREAS, The Pun Group, LLP is a certified public account firm and is qualified by experience and ability to perform the services desired by the City, and The Pun Group is willing to perform such services for Fiscal Years ending June 30, 2018 to June 30, 2020 with the option to extend the term of the Agreement for the two subsequent Fiscal Years. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of National City hereby authorizes the Mayor to execute an Agreement with The Pun Group, LLP for independent auditing services for the Fiscal Years ending June 30, 2018 to June 30, 2020 with the option to extend the agreement for each of the two (2) subsequent fiscal years. PASSED and ADOPTED this 17th day of July, 2018. Ca2125c141(1-"j.3 Albert Mendivil, Vice Mayor For Ron Morrison, Mayor ATTEST: %rif Michael R. D:�Ia, ity Cle k APPROVED AS TO FORM: Angil P. Morris -Jones City Attorney vL� By: Nicole Pedone Acting City Attorney Passed and adopted by the Council of the City of National City, California, on July 17, 2018 by the following vote, to -wit: Ayes: Councilmembers Cano, Mendivil, Rios, Sotelo-Solis. Nays: None. Absent: Morrison. Abstain: None. AUTHENTICATED BY: RON MORRISON Mayor of the City of National City, California City Clerk of the City of National City, California By: I HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of RESOLUTION NO. 2018-122 of the City of National City, California, passed and adopted by the Council of said City on July 17, 2018. City Clerk of the City of National City, California By: Deputy CITY OF NATIONAL CITY, CALIFORNIA COUNCIL AGENDA STATEMENT zo13-31 MEETING DATE: July 17, 2018 AGENDA ITEM NO. 5 rEM TITLE: Resolution of the City Council of the City of National City authorizing the Mayor to execute an agreement with The Pun Group, LLP for independent auditing services for the fiscal years ending June 30, 2018 to June 30, 2020 with the option to extend the agreement for each of the two (2) subsequent fiscal years. PREPARED BY: Javier Carcamo, Financial Services Officer DEPARTMENT: ~ Finance A/^ PHONE: 619-336-4330 APPROVED BY: Y.- EXPLANATION: See attached staff report FINANCIAL STATEMENT: ACCOUNT NO. See attached staff report. APPROVED: Finance APPROVED: MIS ENVIRONMENTAL REVIEW: This is not a project and, therefore, not subject to environmental review. ORDINANCE: INTRODUCTION: FINAL ADOPTION: STAFF RECOMMENDATION: Adopt the resolution, authorizing the Mayor to execute an agreement with The Pun Group, LLP for independent auditing services for the fiscal years ending June 30, 2018 to June 30, 2020 with the option to extend the agreement for each of the two (2) subsequent fiscal years. BOARD / COMMISSION RECOMMENDATION: ATTACHMENTS: . Staff Report 2. Agreement 3. Resolution 745b (w476C, Ito. .1M I Z.4 NATION _14 airy __. tNLORPORATEU City Council Staff Report July 17, 2018 ITEM Resolution of the City Council of the City of National City authorizing the Mayor to execute an agreement with The Pun Group, LLP for independent auditing services for the fiscal years ending June 30, 2018 to June 30, 2020 with the option to extend the agreement for each of the two (2) subsequent fiscal years. BACKGROUND The City has received independent auditing services from The Pun Group, LLP, formerly Pun & McGeady, LLP, for the past five years. In anticipation of the expiration of its agreement with the Pun Group, the City issued a request for proposals ("RfP") for independent auditing services on April 26, 2018. REQUEST FOR PROPOSALS The RfP solicited responses from qualified firms to audit the City's financial statements, as well as the financial statements of its component units for the fiscal years ending June 30, 2018, 2019, and 2020. The specifications required that the audit be performed in accordance with generally accepted auditing standards as set forth by the American Institute of Certified Public Accountants, the provision of the Single Audit Act of 1996 and Uniform Guidance, and all applicable Governmental Accounting Standard Board statements. REQUEST FOR PROPOSALS PROCESS As noted above, the City issued the RfP for professional audit services on April 26, 2018. The City posted the RfP on its website and the California Society of Municipal Finance Officers (CSMFO) website. Responses to the RfP were due by 4:00 pm on May 14, 2018. The City received seven (7) proposals in response to the RfP. The firms submitting proposals, listed in alphabetical order, are: Crowe Horwath; Gruber & Associates; Harshwal & Company, LLP; Lance Soll & Lunghard, LLP; Page 2 Resolution of the City Council of the City of National City authorizing the Mayor to execute an agreement with The Pun Group, LLP for independent auditing services for the fiscal years ending June 30, 2018 to June 30, 2020 with the option to extend the agreement for each of the two (2) subsequent fiscal years. July 17, 2018 Pun Group, LLP; Van Lant & Fankhanel, LLP; White Nelson Diehl Evans, LLP. The evaluation committee, a team of three City staff members, reviewed the proposals in accordance with the evaluation criteria set forth in the RfP. The evaluation committee included the following members: Javier Carcamo, Financial Services Officer; Carlos Aguirre, Acting Director of Housing & Economic Development; Arnold Ocana, Senior Accountant. The evaluation committee evaluated and ranked the proposals of all firms, based upon the following factors: • quality and responsiveness of the proposal; • relevant experience with similar engagements; • demonstrated knowledge of the work/services required; • staff qualifications and experience; • proposed audit approach; and • cost of services. The evaluation committee members individually reviewed and evaluated each firm's proposal based on the evaluation criteria set forth in the RfP. The firms submitting proposals, which demonstrated the most significant relevant experience with similar engagements and knowledge of the scope of work, were invited to provide an oral presentation to the committee followed by an interview. The firms selected for presentations and interviews, listed in alphabetical order, are: Lance Soll & Lunghard, LLP; Pun Group, LLP; White Nelson Diehl Evans, LLP. After reviewing and considering each proposal and the information received during oral presentations and interviews, the evaluation committee selected The Pun Group, LLP as the highest-ranking firm to provide independent auditing services to the City. THE PUN GROUP, LLP (section from proposal) The Pun Group, LLP, Certified Public Accountants and Business Advisors, founded in 2012, is a limited liability partnership. We are a full -service accounting firm that is comprised of forty (40) professionals providing auditing, accounting, and advisory services to our clients. Page 3 Resolution of the City Council of the City of National City authorizing the Mayor to execute an agreement with The Pun Group, LLP for independent auditing services for the fiscal years ending June 30, 2018 to June 30, 2020 with the option to extend the agreement for each of the two (2) subsequent fiscal years. July 17, 2018 Our Partners' Group —which includes Kenneth H. Pun, Vanessa I. Burke, John F. Georger, Jr., Gary M. Caporicci, Lisa B. Lumbard, Frances J. Kuo, and Heidy K. Chow —provide auditing, accounting, and advisory services to numerous governmental entities throughout the United States. With more than two hundred (200) years of combined experience in the industry, we have become a trusted business partner, and are well respected as leaders in the industry in one of the fastest growing firms. With nearly 100 government agency audit clients and Partners who have a real passion for the industry, we believe we are unmatched in terms of expertise. RECOMMENDATION Staff recommends the City Council approve the resolution, authorizing the Mayor to execute an agreement with The Pun Group, LLP for independent auditing services for the fiscal years ending June 30, 2018 to June 30, 2020 with the option to extend the agreement for each of the two (2) additional one-year options. FISCAL IMPACT An appropriation for professional audit services is incorporated in the fiscal year 2019 proposed budget. This is a multi -year agreement with funds to be included in future years' budgets. The not -to -exceed amounts for each fiscal year of the agreement are as follows: Morgan & Kimball Not to Agreement Budget General HCVP Enterprise Exceed Year' Fis cal Year Fund Fund Funds Fe e 1 2019 43,500 3,500 14,000 61,000 2 2020 44,370 3,570 14,280 62,220 3 2021 45,257 3,641 14,566 63,464 4' 2022 46,164 3,714 14,856 64,734 5' 2023 47,085 3,789 15,154 66,028 ' The City has the option to extend the agreement under the same terms and conditions for year 4 and year 5. ATTACHMENTS Attachment 1 — The Pun Group, LLP Agreement Attachment 2 — Resolution AGREEMENT BY AND BETWEEN THE CITY OF NATIONAL CITY AND THE PUN GROUP, LLP THIS AGREEMENT is entered into on this 17th day of July, 2018, by and between the CITY OF NATIONAL CITY, a municipal corporation (the "CITY"). and THE PUN GROUP, LLP, a Limited Liability Partnership (the "CONSULTANT"). RECITALS WHEREAS, the CITY desires to employ a CONSULTANT to provide independent auditing services. WHEREAS, the CITY has determined that the CONSULTANT is a certified public accounting firm and is qualified by experience and ability to perform the services desired by the CITY, and the CONSULTANT is willing to perform such services. NOW, THEREFORE, THE PARTIES HERETO DO MUTUALLY AGREE AS FOLLOWS: 1. ENGAGEMENT OF CONSULTANT. The CITY agrees to engage the CONSULTANT to perform professional auditing services, and the CONSULTANT agrees to perform the services set forth here in accordance with all terms and conditions contained herein. The CONSULTANT represents that all services shall be performed directly by the CONSULTANT or under direct supervision of the CONSULTANT. 2. EFFECTIVE DATE AND LENGTH OF AGREEMENT. This Agreement will become effective on July 3, 2018. The duration of this Agreement is for the period of July 17, 2018 through June 30, 2021, corresponding to audit services provided for fiscal years ending June 30, 2018 to June 30, 2020. This Agreement may be extended by mutual agreement upon the same terms and conditions for an additional one (1) year term. The Parties may exercise up to two one-year extensions. Any extension of this Agreement must be approved in writing by the City Council. 3. SCOPE OF SERVICES. The CONSULTANT will perform those auditing and accounting services as set forth in the attached Exhibit "A". The CONSULTANT'S services will be based upon tests of accounting records and other supporting evidence for selected periods during the fiscal year under review sufficient to enable the CONSULTANT to express an informed written opinion on: (1) the financial position of the various funds of the City; (2) the propriety of accounting principles followed; (3) compliance with applicable laws; and (4) the financial accountability of officers and employees. The CONSULTANT shall be responsible for all research and reviews related to the work and shall not rely on personnel of the CITY for such services, except as authorized in advance by the CITY. The CONSULTANT shall appear at meetings on an as -needed basis, to keep staff and City Council advised of the progress on the project. The CITY may unilaterally, or upon request from the CONSULTANT, from time to time reduce or increase the Scope of Services to be performed by the CONSULTANT under this Agreement. Upon doing so, the CITY and the CONSULTANT agree to meet in good faith and confer for the purpose of negotiating a corresponding reduction or increase in the compensation associated with said change in services. 4. PROJECT COORDINATION AND SUPERVISION. Mark Roberts, Director of Finance, hereby is designated as the Project Coordinator for the CITY and will monitor the progress and execution of this Agreement. The CONSULTANT shall assign a single Project Director to provide supervision and have overall responsibility for the progress and execution of this Agreement for the CONSULTANT. Kenneth H. Pun thereby is designated as the Project Director for the CONSULTANT. 5. COMPENSATION AND PAYMENT. The compensation for the CONSULTANT shall be based on monthly billings covering actual work performed. Billings shall include labor classifications, respective rates, hours worked and also materials, if any. The total cost for all work described in Exhibit "A" shall not exceed amounts set forth in Exhibit "B". The compensation for the CONSULTANT'S work shall not exceed the rates set forth in Exhibit "B". Invoices will be processed as set forth in Exhibit "B" for payment and remitted within thirty (30) days from receipt of invoice, provided that work is accomplished consistent with Exhibit "A". as determined by the CITY. Consistent with Section 7, the CONSULTANT shall maintain, at CONSULTANT'S expense. all books, documents, papers, employee time sheets, accounting records, and other evidence pertaining to costs incurred for a minimum of seven (7) years, and shall make such materials available at its office at all reasonable times during the term of this Agreement and for at least seven (7) years from the date of final payment under this Agreement, for inspection by the CITY, and for furnishing of copies to the CITY, if requested. 6. ACCEPTABILITY OF WORK. The CITY shall decide any and all questions which may arise as to the quality or acceptability of the services performed and the manner of performance, the acceptable completion of this Agreement, and the amount of compensation due. In the event the CONSULTANT and the CITY cannot agree to the quality or acceptability of the work, the manner of performance and/or the compensation payable to the CONSULTANT in this Agreement, the CITY or the CONSULTANT shall give to the other written notice. Within ten (10) business days, the CONSULTANT and the CITY shall each prepare a report which supports their position and file the same with the other party. The CITY shall, with reasonable diligence, determine the quality or acceptability of the work, the manner of performance and/or the compensation payable to the CONSULTANT. 7. DISPOSITION AND OWNERSHIP OF DOCUMENTS. All working papers and reports must be retained, at the CONSULTANT'S expense, for a minimum of seven (7) years, unless CONSULTANT is notified in writing by the CITY of the need to extend the retention period. The CONSULTANT will be required to make working papers available, upon request, to the following parties or their designees: Standard Agreement Page 2 of 11 Revised July 2017 Pun Group. LLP City of National City and • The City Of National City; • U.S. Department of Housing and Urban Development (HUD); • U.S. General Accounting Office (GAO); • State of California, Office of the State Controller • Parties designated by the federal or state governments or by the CITY as part of an audit quality review process; and, • Auditors of entities of which the CITY is a sub -recipient of grant funds. In addition, the CONSULTANT shall respond to the reasonable inquiries of successor auditors and allow successor auditors to review working papers relating to matters of continuing accounting significance. The Memoranda, Reports, Maps, Drawings, Plans, Specifications, and other documents prepared by the CONSULTANT for this project, whether paper or electronic, shall become the property of the CITY for use with respect to this project, and shall be turned over to the CITY upon completion of the project, or any phase thereof, as contemplated by this Agreement. Contemporaneously with the transfer of documents, the CONSULTANT hereby assigns to the C1TY, and CONSULTANT thereby expressly waives and disclaims any copyright in, and the right to reproduce, all written material, drawings, plans, specifications, or other work prepared under this Agreement, except upon the CITY'S prior authorization regarding reproduction, which authorization shall not be unreasonably withheld. The CONSULTANT shall, upon request of the CITY, execute any further document(s) necessary to further effectuate this waiver and disclaimer. The CONSULTANT agrees that the CITY may use, reuse, alter, reproduce, modify, assign, transfer, or in any other way, medium, or method utilize the CONSULTANT'S written work product for the CITY'S purposes, and the CONSULTANT expressly waives and disclaims any residua! rights granted to it by Civil Code Sections 980 through 989 relating to intellectual property and artistic works. Any modification or reuse by the CITY of documents, drawings, or specifications prepared by the CONSULTANT shall relieve the CONSULTANT from liability under Section 14, but only with respect to the effect of the modification or reuse by the C1TY, or for any liability to the CITY should the documents be used by the CITY for some project other than what was expressly agreed upon within the Scope of Services of this project, unless otherwise mutually agreed. 8. INDEPENDENT CONTRACTOR. Both parties hereto in the performance of this Agreement will be acting in an independent capacity and not as agents, employees, partners, or joint venturers with one another. Neither the CONSULTANT nor the CONSULTANT'S employees are employees of the CITY, and are not entitled to any of the rights, benefits, or privileges of the CITY'S employees, including but not limited to retirement, medical, unemploy- ment, or workers' compensation insurance. This Agreement contemplates the personal services of the CONSULTANT and the CONSULTANT'S employees, and it is recognized by the parties that a substantial inducement to the CITY for entering into this Agreement was, and is, the professional reputation and competence of the CONSULTANT and its employees. Neither this Agreement nor any interest herein may be assigned by the CONSULTANT without the prior written consent of the CITY. Nothing herein contained is intended to prevent the CONSULTANT from employing or Standard Agreement Page 3 of 11 Revised July 2017 Pun Group, LLP City of National City and hiring as many employees, or SUBCONSULTANTS, as the CONSULTANT may deem necessary for the proper and efficient performance of this Agreement. All agreements by CONSULTANT with its SUBCONSULTANT(S) shall require the SUBCONSULTANT(S) to adhere to the applicable terms of this Agreement. 9. CONTROL. Neither the CITY nor its officers, agents, or employees shall have any control over the conduct of the CONSULTANT or any of the CONSULTANT'S employees, except as herein set forth, and the CONSULTANT or the CONSULTANT'S agents, servants, or employees are not in any manner agents, servants, or employees of the CITY, it being understood that the CONSULTANT its agents, servants, and employees are as to the CITY wholly independent CONSULTANT, and that the CONSULTANT'S obligations to the CITY are solely such as are prescribed by this Agreement. 10. COMPLIANCE WITH APPLICABLE LAW. The CONSULTANT, in the performance of the services to be provided herein, shall comply with all applicable state and federal statutes and regulations, and all applicable ordinances, rules, and regulations of the City of National City, whether now in force or subsequently enacted. The CONSULTANT and each of its SUBCONSULTANT(S), shall obtain and maintain a current City of National City business license prior to and during performance of any work pursuant to this Agreement. 11. LICENSES, PERMITS, ETC. The CONSULTANT represents and covenants that it has all licenses, permits, qualifications, and approvals of whatever nature that are legally required to practice its profession. The CONSULTANT represents and covenants that the CONSULTANT shall, at its sole cost and expense, keep in effect at all times during the term of this Agreement, any license, permit, or approval which is legally required for the CONSULTANT to practice its profession. 12. STANDARD OF CARE. A. The CONSULTANT, in performing any services under this Agreement, shall perform in a manner consistent with that level of care and skill ordinarily exercised by members of the CONSULTANT'S trade or profession currently practicing under similar conditions and in similar locations. The CONSULTANT shall take all special precautions necessary to protect the CONSULTANT'S employees and members of the public from risk of harm arising out of the nature of the work and/or the conditions of the work site. B. Unless disclosed in writing prior to the date of this Agreement, the CONSULTANT warrants to the CITY that it is not now, nor has it for the five (5) years preceding, been debarred by a governmental agency or involved in debarment, arbitration or litigation proceedings concerning the CONSULTANT'S professional performance or the furnishing of materials or services relating thereto. C. The CONSULTANT is responsible for identifying any unique products, treatments, processes or materials whose availability is critical to the success of the project the CONSULTANT has been retained to perform, within the time requirements of the CITY, or, when no time is specified, then within a commercially reasonable time. Accordingly, unless the CONSULTANT has notified the CITY otherwise, the CONSULTANT warrants that all products, materials, processes or treatments identified in the project documents prepared for the CITY are reasonably commercially available. Any failure by the CONSULTANT to use due diligence under this sub -section will render the CONSULTANT liable to the CITY for any Standard Agreement Page 4 of 11 Revised July 2017 Pun Group, LLP City of National City and increased costs that result from the CITY'S later inability to obtain the specified items or any reasonable substitute within a price range that allows for project completion in the time frame specified or, when not specified, then within a commercially reasonable time. 13. NON-DISCRIMINATION PROVISIONS. The CONSULTANT shall not discriminate against any employee or applicant for employment because of age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. The CONSULTANT will take positive action to insure that applicants are employed without regard to their age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. Such action shall include but not be limited to the following: employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. The CONSULTANT agrees to post in conspicuous places available to employees and applicants for employment any notices provided by the CITY setting forth the provisions of this non-discrimination clause. 14. CONFIDENTIAL INFORMATION. The CITY may from time to time communicate to the CONSULTANT certain confidential information to enable the CONSULTANT to effectively perform the services to be provided herein. The CONSULTANT shall treat all such information as confidential and shall not disclose any part thereof without the prior written consent of the CITY. The CONSULTANT shall limit the use and circulation of such information, even within its own organization, to the extent necessary to perform the services to be provided herein. The foregoing obligation of this Section 14, however, shall not apply to any part of the information that (i) has been disclosed in publicly available sources of information; (ii) is, through no fault of the CONSULTANT, hereafter disclosed in publicly available sources of information; (iii) is already in the possession of the CONSULTANT without any obligation of confidentiality; or (iv) has been or is hereafter rightfully disclosed to the CONSULTANT by a third party, but only to the extent that the use or disclosure thereof has been or is rightfully authorized by that third party. The CONSULTANT shall not disclose any reports, recommendations, conclusions or other results of the services or the existence of the subject matter of this Agreement without the prior written consent of the CITY. In its performance hereunder, the CONSULTANT shall comply with all legal obligations it may now or hereafter have respecting the information or other property of any other person, firm or corporation. CONSULTANT shall be liable to CITY for any damages caused by breach of this condition, pursuant to the provisions of Section 15. 15. INDEMNIFICATION AND HOLD HARMLESS. The CONSULTANT agrees to defend, indemnify and hold harmless the City of National City, its officers, officials, agents, employees, and volunteers against and from any and all liability, loss, damages to property, injuries to, or death of any person or persons, and all claims, demands, suits, actions, proceedings, reasonable attorneys' fees, and defense costs, of any kind or nature, including workers' compensation claims, of or by anyone whomsoever, resulting from or arising out of the CONSULTANT'S performance or other obligations under this Agreement; provided, however, that this indemnification and hold harmless shall not include any claims or liability arising from the established sole negligence or willful misconduct of the CITY, its agents, officers, employees Standard Agreement Page 5 of 11 City of National City and Revised July 2017 Pun Group. LLP or volunteers. CITY will cooperate reasonably in the defense of any action, and CONSULTANT shall employ competent counsel, reasonably acceptable to the City Attorney. The indemnity, defense, and hold harmless obligations contained herein shall survive the termination of this Agreement for any alleged or actual omission, act, or negligence under this Agreement that occurred during the term of this Agreement. 16. WORKERS' COMPENSATION. The CONSULTANT shall comply with all of the provisions of the Workers' Compensation Insurance and Safety Acts of the State of California, the applicable provisions of Division 4 and 5 of the California Labor Code and all amendments thereto; and all similar State or federal acts or laws applicable; and shall indemnify, and hold harmless the CITY and its officers, employees, and volunteers from and against all claims, demands, payments, suits, actions, proceedings, and judgments of every nature and description, including reasonable attorney's fees and defense costs presented, brought or recovered against the CITY or its officers, employees, or volunteers, for or on account of any liability under any of said acts which may be incurred by reason of any work to be performed by the CONSULTANT under this Agreement. 17. INSURANCE. The CONSULTANT, at its sole cost and expense, shall purchase and maintain, and shall require its SUBCONSULTANT(S), when applicable, to purchase and maintain throughout the term of this Agreement, the following insurance policies: A. ® If checked, Professional Liability Insurance (errors and omissions) with minimum limits of S 1,000,000 per occurrence. B. Automobile insurance covering all bodily injury and property damage incurred during the performance of this Agreement, with a minimum coverage of SI,000,000 combined single limit per accident. Such automobile insurance shall include non - owned and hired vehicles. The policy shall name the CITY and its officers, agents, employees, and volunteers as additional insureds, and a separate additional insured endorsement shall be provided. C. Commercial General Liability Insurance, with minimum limits of either $2,000,000 per occurrence and $4,000,000 aggregate, or $1,000,000 per occurrence and $2,000,000 aggregate with a $2,000,000 umbrella policy, covering all bodily injury and property damage arising out of its operations, work, or performance under this Agreement. The policy shall name the CITY and its officers, agents, employees, and volunteers as additional insureds, and a separate additional insured endorsement shall be provided. The general aggregate limit must apply solely to this "project" or "location". The "project" or "location" should be noted with specificity on an endorsement that shall be incorporated into the policy. D. Workers' Compensation Insurance in an amount sufficient to meet statutory requirements covering all of CONSULTANT'S employees and employers' liability insurance with limits of at least $1,000,000 per accident. 1n addition, the policy shall be endorsed with a waiver of subrogation in favor of the CITY. Said endorsement shall be provided prior to commencement of work under this Agreement. If CONSULTANT has no employees subject to the California Workers' Compensation and Labor laws, CONSULTANT shall execute a Declaration to that effect. Said Declaration shall be provided to CONSULTANT by CITY. E. The aforesaid policies shall constitute primary insurance as to the CITY, its officers, officials, employees, and volunteers, so that any other policies held by the CITY shall not contribute to any loss under said insurance. Said policies shall provide for thirty (30) Standard Agreement Page 6 of 11 Revised July MI Pun Group. LLP City of National City and days prior written notice to the CITY's Risk Manager, at the address listed in subsection G below, of cancellation or material change. F. If required insurance coverage is provided on a "claims made" rather than "occurrence" form, the CONSULTANT shall maintain such insurance coverage for three years after expiration of the term (and any extensions) of this Agreement. In addition, the "retro" date must be on or before the date of this Agreement. G. The Certificate Holder for all policies of insurance required by this Section shall be: City of National City c/o Risk Manager 1243 National City Boulevard National City, CA 91950-4397 H. Insurance shall be written with only insurers authorized to conduct business in Californiathat hold a current policy holder's alphabetic and financial size category rating of not less than A:VII according to the current Best's Key Rating Guide, or a company of equal financial stability that is approved by the CITY'S Risk Manager. In the event coverage is provided by non -admitted "surplus lines" carriers. they must be included on the most recent California List of Eligible Surplus Lines Insurers (LESLI list) and otherwise meet rating requirements. I. This Agreement shall not take effect until certificate(s) or other sufficient proof that these insurance provisions have been complied with, are filed with and approved by the CITY'S Risk Manager. If the CONSULTANT does not keep all of such insurance policies in full force and effect at all times during the terms of this Agreement, the CITY may elect to treat the failure to maintain the requisite insurance as a breach of this Agreement and terminate the Agreement as provided herein. J. All deductibles and self -insured retentions in excess of $10,000 must be disclosed to and approved by the CITY. K. If the CONSULTANT maintains broader coverage or higher limits (or both) than the minimum limits shown above, the CITY requires and shall be entitled to the broader coverage or higher limits (or both) maintained by the CONSULTANT. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the CITY. 18. LEGAL FEES. If any party brings a suit or action against the other party arising from any breach of any of the covenants or agreements or any inaccuracies in any of the representations and warranties on the part of the other party arising out of this Agreement, then in that event, the prevailing party in such action or dispute, whether by final judgment or out -of - court settlement, shall be entitled to have and recover of and from the other party all costs and expenses of suit, including attorneys' fees. For purposes of determining who is to be considered the prevailing party, it is stipulated that attorney's fees incurred in the prosecution or defense of the action or suit shall not be considered in determining the amount of the judgment or award. Attorney's fees to the prevailing party if other than the CITY shall, in addition, be limited to the amount of attorney's fees Standard Agreement Page 7 of 11 Revised July 2017 Pun Group. LLP City of National City and incurred by the CITY in its prosecution or defense of the action, irrespective of the actual amount of attorney's fees incurred by the prevailing party. 19. TERMINATION. A. This Agreement may be terminated with or without cause by the CITY. Termination without cause shall be effective only upon 60-clay's written notice to the CONSULTANT. During said 60-day period the CONSULTANT shall perform all services in accordance with this Agreement. B. This Agreement may also be terminated immediately by the CITY for cause in the event of a material breach of this Agreement, misrepresentation by the CONSULTANT in connection with the formation of this Agreement or the performance of services, or the failure to perform services as directed by the CITY. C. Termination with or without cause shall be effected by delivery of written Notice of Termination to the CONSULTANT as provided for herein. D. In the event of termination, all finished or unfinished Memoranda Reports, Maps, Drawings, Plans, Specifications and other documents prepared by the CONSULTANT, whether paper or electronic, shall immediately become the property of and be delivered to the CITY, and the CONSULTANT shall be entitled to receive just and equitable compensation for any work satisfactorily completed on such documents and other materials up to the effective date of the Notice of Termination, not to exceed the amounts payable hereunder, and less any damages caused the CITY by the CONSULTANT'S breach, if any. Thereafter, ownership of said written material shall vest in the CITY all rights set forth in Section 7. E. The CITY further reserves the right to immediately terminate this Agreement upon: (1) the filing of a petition in bankruptcy affecting the CONSULTANT; (2) a reorganization of the CONSULTANT for the benefit of creditors; or (3) a business reorganization, change in business name or change in business status of the CONSULTANT. 20. NOTICES. All notices or other communications required or permitted hereunder shall be in writing, and shall be personally delivered; or sent by overnight mail (Federal Express or the like); or sent by registered or certified mail, postage prepaid, return receipt requested; or sent by ordinary mail, postage prepaid; or telegraphed or cabled; or delivered or sent by telex, telecopy, facsimile or fax; and shall be deemed received upon the earlier of (i) if personally delivered, the date of delivery to the address of the person to receive such notice, (ii) if sent by overnight mail, the business day following its deposit in such overnight mail facility, (iii) if mailed by registered, certified or ordinary mail, five (5) days (ten (10) days if the address is outside the State of California) after the date of deposit in a post office, mailbox, mail chute, or other like facility regularly maintained by the United States Postal Service, (iv) if given by telegraph or cable, when delivered to the telegraph company with charges prepaid, or (v) if given by telex, telecopy, facsimile or fax, when sent. Any notice, request, demand, direction or other communication delivered or sent as specified above shall be directed to the following persons: To CITY: Mark Roberts Director of Finance Department of Finance City of National City 1243 National City Boulevard Standard Agreement Page 8 of 11 Revised July 2017 Pun Group. !LP City of National City and National City, CA 91950-4397 To CONSULTANT: Kenneth H. Pun, CPA, CGMA Managing Partner The Pun Group, LLP 4365 Executive Drive, Suite 710 San Diego, CA 92121 Notice of change of address shall be given by written notice in the manner specified in this Section. Rejection or other refusal to accept or the inability to deliver because of changed address of which no notice was given shall be deemed to constitute receipt of the notice, demand, request or communication sent. Any notice, request, demand, direction or other communication sent by cable, telex, telecopy, facsimile or fax must be confirmed within forty- eight (48) hours by letter mailed or delivered as specified in this Section. 21. CONFLICT OF INTEREST AND POLITICAL REFORM ACT OBLIGATIONS. During the term of this Agreement, the CONSULTANT shall not perform services of any kind for any person or entity whose interests conflict in any way with those of the City of National City. The CONSULTANT also agrees not to specify any product, treatment, process or material for the project in which the CONSULTANT has a material financial interest, either direct or indirect, without first notifying the CITY of that fact. The CONSULTANT shall at all times comply with the terms of the Political Reform Act and the National City Conflict of Interest Code. The CONSULTANT shall immediately disqualify itself and shall not use its official position to influence in any way any matter coming before the CITY in which the CONSULTANT has a financial interest as defined in Government Code Section 87103. The CONSULTANT represents that it has no knowledge of any financial interests that would require it to disqualify itself from any matter on which it might perform services for the CITY. If checked, the CONSULTANT shall comply with all of the reporting requirements of the Political Reform Act and the National City Conflict of Interest Code. Specifically, the CONSULTANT shall file a Statement of Economic Interests with the City Clerk of the City of National City in a timely manner on forms which the CONSULTANT shall obtain from the City Clerk. The CONSULTANT shall be strictly liable to the CITY for all damages, costs or expenses the CITY may suffer by virtue of any violation of this Section 21 by the CONSULTANT. 22. PREVAILING WAGES. State prevailing wage rates may apply to work performed under this Agreement. State prevailing wages rates apply to all public works contracts as set forth in California Labor Code, including but not limited to, Sections 1720,1720.2, 1720.3, 1720.4, and 1771. Consultant is solely responsible to determine if State prevailing wage rates apply and, if applicable, pay such rates in accordance with all laws, ordinances, rules, and regulations. 23. MISCELLANEOUS PROVISIONS. A. Computation of Time Periods. If any date or time period provided for in this Agreement is or ends on a Saturday, Sunday or federal, state or legal holiday, then such date Standard Agreement Page 9 of 11 Revised July 2017 Pun Group, LLP City of National City and shall automatically be extended until 5:00 p.m. Pacific Time of the next day which is not a Saturday, Sunday or federal, state, or legal holiday. B. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute but one and the same instrument. C. Captions. Any captions to, or headings of, the sections or subsections of this Agreement are solely for the convenience of the parties hereto, are not a part of this Agreement, and shall not be used for the interpretation or determination of the validity of this Agreement or any provision hereof. D. No Obligations to Third Parties. Except as otherwise expressly provided herein, the execution and delivery of this Agreement shall not be deemed to confer any rights upon, or obligate any of the parties hereto, to any person or entity other than the parties hereto. E. Exhibits and Schedules. The Exhibits and Schedules attached hereto are hereby incorporated herein by this reference for all purposes. To the extent any exhibits,schedules, or provisions thereof conflict or are inconsistent with the terms and conditions contained in this Agreement, the terms and conditions of this Agreement shall control. F. Amendment to this Agreement. The terms of this Agreement may not be modified or amended except by an instrument in writing executed by each of the parties hereto. G. Waiver. The waiver or failure to enforce any provision of this Agreement shall not operate as a waiver of any future breach of any such provision or any other provision hereof. H. Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California. I. Audit. If this Agreement exceeds ten -thousand dollars ($10,000), the parties shall be subject to the examination and audit of the State Auditor for a period of three (3) years after final payment under the Agreement, per Government Code Section 8546.7. J. Entire Agreement. This Agreement supersedes any prior agreements, negotiations and communications, oral or written, and contains the entire agreement between the parties as to the subject matter hereof. No subsequent agreement, representation, or promise made by either party hereto, or by or to an employee, officer, agent or representative of any party hereto shall be of any effect unless it is in writing and executed by the party to be bound thereby. K. Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the successors and assigns of the parties hereto. L. Subcontractors or Subconsultants. The CITY is engaging the services of the CONSULTANT identified in this Agreement. The CONSULTANT shall not subcontract any portion of the work, unless such subcontracting was part of the original proposal or is allowed by the CITY in writing. In the event any portion of the work under this Agreement is subcontracted, the subconsultant(s) shall be required to comply with and agree to, for the benefit of and in favor of the CITY, both the insurance provisions in Section 17 and the indemnification and hold harmless provision of Section 15 of this Agreement. M. Construction. The parties acknowledge and agree that (i) each party is of equal bargaining strength, (ii) each party has actively participated in the drafting, preparation and negotiation of this Agreement, (iii) each such party has consulted with or has had the opportunity to consult with its own, independent counsel and such other professional advisors as such party has deemed appropriate, relative to any and all matters contemplated under this Agreement, (iv) each party and such party's counsel and advisors have reviewed this Agreement, (v) each party Standard Agreement Page 10 of 11 Revised July 2017 Pun Group, LLP City of National City and has agreed to enter into this Agreement following such review and the rendering of such advice, and (vi) any rule or construction to the effect that ambiguities are to be resolved against the drafting party shall not apply in the interpretation of this Agreement, or any portions hereof, or any amendments hereto. IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date and year first above written. CITY OF NATIONAL CITY By: Ron Morrison, Mayor APPROVED AS TO FORM: Angil P. Morris -Jones City Attorney By: Roberto M. Contreras Deputy City Attorney THE PUN GROUP, LLP (Corporation - signatures of two corporate officers required) (Partnership or Sole proprietorship - one signature) By: )h I• t �"_" (Nam "+rd jtr ,`. AA/ (Print) / (Title) By: (Name) Standard Agreement Page 11 of 11 Revised July 2017 Pun Group, LLP (Print) (Title) City of National City and Exhibit A Scope of Work A. The Consultant will be required to perform the following tasks: 1. audit of all funds of the City in accordance with the United States Government Accountability Office's Generally Accepted Government Auditing Standards; 2. preparation, including word processing, of the City's CAFR and the financial statements of its component units in compliance with applicable GASB statements; 3. Gann limit review pertaining to the City's appropriation limit, rendering a letter annually regarding compliance; 4. City-wide audit of the expenditures of federal grants in accordance with Uniform Guidance and preparation of the appropriate reports, testing two (2) major programs, including the Housing Choice Voucher Program ("HCVP"); 5. financial and compliance audit of the Successor Agency to the Community Development Commission as the National City Redevelopment Agency ("Successor Agency") including Kimball Towers; 6. separate United States Department of Housing and Urban Development (HUD) required single audit of Morgan Towers in accordance with Uniform Guidance; 7. commission single audit of federal grants allocable to HCVP in accordance with Uniform Guidance; and 8. Real Estate Assessment Center electronic submission to HUD and related attestations. B. Additional Services: 1. compile the Annual State Controller's Report for the City; and 2. serve as a resource and provide training to professional accounting staff on preparation of financial statements and best practices in conformance with applicable laws and governmental accounting standards. 3. provide on -going, infrequent consulting services for financial issues that may occur throughout the year. No additional charges are to be made by the Consultant for these financial consulting services. C. Auditing Standards to be followed: The Consultant shall review the financial records and all the various funds of the City and prepare all the financial statements in conformance with: 1. generally accepted auditing standards as set forth by the American Institute of Certified Public Accountants (AICPA); 2, the standards applicable to financial audits contained in Government Auditing Standards (2011 revision) issued by the Comptroller General of the United States; 3. the provisions of the Single Audit Act of 1996 and the provisions of Uniform Guidance; and 4. all applicable GASB statements. D. Reports to be Issued: Following the completion of the audit of the fiscal year's financial statements, the Consultant shall issue: 1. a report on the fair presentation of the financial statements in conformity with generally accepted accounting principles for all entities listed above; 2. a report on compliance and on the internal control over financial reporting based on an audit of financial statements performed in accordance with Government Auditing Standards; 3. a report on compliance with requirements applicable to each major program and internal control over compliance in accordance with Uniform Guidance (Single Audit); 4. a schedule of Expenditures of Federal Awards together with applicable notes to this schedule (Single Audit); 5, a schedule of findings and questioned costs (Single Audit); Page 1 of 5 City of National City and Pun Group, LLP Exhibit A 6. status of prior year findings (Single Audit); and 7. Form SF -SAC, Data Collections Forrn for Reporting of Audits of States, Local Governments and Non - Profit Organizations. 8. In the required reports on internal controls the Consultant 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 financial statements. Reportable conditions that are also material weaknesses shall be identified as such in the report. Non -reportable conditions discovered by the Consultant shall be reported in a separate letter to management, which shall be referred to in the reports on internal controls. The reports on compliance shall include all instances of noncompliance. E. Irregularities and Illegal Acts The Consultant 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 City Council, City Manager, City Attorney, and Director of Finance. F. Special Requirements 1. Budget In accordance with provisions of the municipal code of the City, it is the duty of the City Manager to prepare and submit to the City Council the annual budget and such reports as may be required by that body. The Consultant shall examine the final budget document (http://www.nationalcityca.gov) as approved by the City Council and compare the estimated revenues and appropriations as shown in the budget document with the entries recorded on the revenue ledger and the appropriation ledger maintained by the Department of Finance. 2. Funds The Consultant shall examine City ordinances or resolutions, and minutes of the City Council pertaining to all funds of the City to determine the purpose of each fund and the proper disposition of all funds revenues, expenditures, and year-end balances. The Consultant shall examine the various fund transactions and balances in each fund and prepare the appropriate financial statements for the audit report. The Consultant shall review the City's municipal code Chapter 4.04.010 — Funds. The Consultant shall advise regarding the necessary funds and designation as established by the aforementioned municipal code. 3. Verification of Cash and Securities a. Cash and Checks: The Consultant shall count all cash and checks in the Department of Finance as of June 30. The Consultant shall subsequently be satisfied that all items counted and verified are deposited in the City's depository bank. Investment securities owned by the City and held in safekeeping by the City's various banks and financial institutions shall be verified as to their existence as of June 30. Written confirmation shall be obtained from all City depositories of balance on hand at June 30. b. Surprise Cash Counts: The Consultant shall make, during the year, at least two surprise cash counts of the funds in the Department of Finance in cooperation with staff members. c. Collateral Pledged for Funds on Deposit: The Consultant shall examine the records of pledged collateral and make such tests of depository bank pooled collateral operations as may be necessary to express an opinion as to the legal sufficiency of the collateral to safeguard the City's bank deposits. Page 2 of 5 City of National City and Pun Group, LLP Exhibit A d. AccountinQ Records: The Consultant shall examine the City's internal accounting and administrative controls to determine that accounting procedures are adequate to safeguard assets and provide reasonable assurance of proper recording of financial transactions. 4. Assets a. Cash and Investments: Treasury and investment operations are the responsibility of the Department of Finance and the City Treasurer. The Consultant shall verify the cash balances and the existence of the investments. The investments market value shall be reviewed and compared to book value. The Consultant shall review balances as of June 30 and investments earnings recorded during the fiscal year. The footnote disclosure shall be in compliance with the corresponding GASB statements. b. Fixed Assets: The Consultant shall examine the procedures for recording the acquisition of and the disposal of property owned by the City. The Consultant shall compare the annual inventories of property with the controls maintained by the Department of Finance. The Consultant shall review the transactions involving fixed assets to the extent necessary to assure that accountability for fixed assets is maintained. 5. Liabilities a. Accounts Payable: The Consultant shall make a sufficient examination of accounts payable to enable them to determine that, in general, they bear evidence of verification and approval with supporting documents such as purchase orders, vendor's invoices, receiving reports, transportation bills, contracts and other documents where necessary. The Consultant shall also be satisfied that the claims were charged against the proper departmental appropriations and that funds were available at the date the purchase was made. b. Banded Debt: The Consultant shall examine the amount of bonded debt of the City and the outstanding debt determined by the Consultant, and it should be reconciled to the accounting records of the City by fund and amount outstanding as of June 30. c. Other Liabilities and Deferred Credits: The Consultant shall be satisfied as to the fairness of the accounts representing other liabilities and deferred credits. 6. Fund Balances The Consultant shall examine revenues and expenditures by funds and analyze the changes in fund balances for the financial statement of each fund in the audit report. 7. Single Audit Act The Consultant shall perform a financial and compliance audit under the Single Audit Act of 1996 and in accordance with OMB Uniform Guidance. The Single Audit Report will include the schedule of expenditures of federal awards, footnotes, findings, and questioned costs, including reportable conditions and material weaknesses, and follow up on prior year audit findings, if applicable. The Single Audit Report is not to be included in the CAFR, but is to be issued separately. G. Audit Schedule; Entrance Conference, Progress Reporting and Exit Conferences: Audit Presentation Page 3 of 5 City of National City and Pun Group, LLP Exhibit A The Consultant shall provide the City with an audit plan and a list of schedules to be prepared by City personnel prior to the beginning of fieldwork. Interim fieldwork would be expected to be performed in May of each year with the final phase of fieldwork commencing in October of each year. The City will attempt to have the books closed and all agreed upon schedules available for the Consultant by September 30 of each year. The Consultant shall have drafts of the final reports and recommendations to management available for review by the Director of Finance by the following date(s): • November 30 of each year or the first business day thereafter if November 30 is not a normal business day. An entrance conference should be scheduled prior to beginning interim fieldwork. Progress reports are expected on at least a monthly basis to the Director of Finance. An exit conference to summarize the results of fieldwork and to review significant findings is expected on the last day of fieldwork or shortly thereafter. The Consultant will be required to present the City financial statements to the City Council. H. Final Reports The Department of Finance will complete their review of the draft report as expeditiously as possible. This process is not expected to exceed two weeks. During that period, the Consultant should be available for any meetings that may be necessary to discuss the drafts. Once all issues for discussion are resolved, the final signed report shall be delivered to the Director of Finance within ten working days. It is anticipated that this process will be completed and the final reports delivered by the following dates: December 31 of each year. The Consultant is responsible for the printing, binding and delivery of the following copies of each audit reports: • 20 copies — City of National City CAFR • 10 copies — Single Audit Report • 5 copies — Separate HUD single audit of Morgan Towers In addition to the final hard copies listed above an electronic version of the report is to be provided in an Adobe Acrobat PDF format (with optical character recognition (OCRJ) and an unbound reproducible master. I. Assistance to be provided to Consultant and Report Preparation 1. Department of Finance Assistance The Department of Finance staff and responsible management personnel will be available during the audit to assist Consultant by providing information, documentation and explanations. The preparation of confirmations will be the responsibility of City, with the assistance of the Consultant. City staff will assist Consultant in identifying and locating supporting documentation. Consultant may be responsible for pulling some files and refiling them depending on the items requested. 2. Information Technology Services (ITS) Assistance Page 4 of 5 City of National City and Pun Group, LLP Exhibit A Information Technology Service Department personnel will be available to provide system's documentation and explanations. The Consultant will be provided computer time and the use of the City's computer hardware and software. 3. Statements and Schedules to be prepared by City Staff The City will prepare the following statements and schedules for the Consultant. Additional statements or schedules may be prepared if mutually agreed upon in advance. a. General Purpose Financial Statements o Cash and Investments o Cash with Fiscal Agent/Trustee o Schedule of Investments o Interest receivable o Schedule of transfers -in and transfers -out a Schedule of Fixed Asset o Compensated Absences o Insurance and claims payable schedule o Schedule of Long-term Debt o Bank Reconciliation o Loans Receivable & Payable o Accounts Receivable & Accounts Payable o Advances Receivable & Payable between Funds o Schedule of fund balance classification o CalPERS Actuarial Valuation Report and Accounting Valuation Report b. Single Audit Schedule of Expenditures of Federal Awards (SEFA) 4. Work Area, Telephones, Photocopying and FAX Machines The City will provide the Consultant with reasonable work space, desks and chairs. The Consultant will also be provided with access to a telephone line, photocopying machine and FAX machine. Page 5 of 5 Exhibit B Compensation and Payments Services to be rendered FY 2018 FY 2019 FY 2020 FY 2021' FY 2022' City Audit, including CAFR Single Audit - 2 Major Programs GANN Limit Annual State Controller's Report Financial and Compliance Audit of CDC, including Kimball Towers Separate HUD - Required Single Audit Morgan Towers Commission Single Audit of Federal Grants Allocable to Housing Choice Voucher Program REAC Electronic Submission to HUD and Related Attestations 31,000 31,620 32,252 32,897 33,555 8,000 8,160 8,323 8,490 8,659 Included Included Included Included Included 4,500 4,590 4,682 4,775 4,871 7,000 7,140 7,283 7,428 7,577 7,000 7,140 7,283 7,428 7,577 3,500 3,570 3,641 3,714 3,789 Included Included Included Included Included Total for Fiscal Year (not -to -exceed) 61,000 62,220 63,464 64,732 66,028 Standard Billing Rates (per hour) Position Partners "anagers ipervisor Senior Accountants Staff Accountants Clerical Invoice Payments2 FY 2018 FY 2019 FY 2020 FY 2021' FY 2022' 250 258 265 273 281 200 206 212 219 225 175 180 186 191 197 150 155 159 164 169 125 129 133 141 141 100 103 106 113 113 Work Performed % of Proposal Amount For Planning 10% For Interim Work 40% For Year -End Work 40% At Presentation and Acceptance of Final Reports 10% Total 100% 1 The City has the option to extend the agreement under the same terms and conditions for year 4 and year 5 2 Invoices will cover a period at least one calendar month The invoices will be charge for work performed based on the percentage of the proposal amount as shown above RESOLUTION NO. 2018 — RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY AUTHORIZING THE MAYOR TO EXECUTE AN AGREEMENT WITH THE PUN GROUP, LLP FOR INDEPENDENT AUDITING SERVICES FOR THE FISCAL YEARS ENDING JUNE 30, 2018 TO JUNE 30, 2020 WITH THE OPTION TO EXTEND THE AGREEMENT FOR EACH OF THE TWO (2) SUBSEQUENT FISCAL YEARS WHEREAS, on April 26, 2018, the City posted a Request for Proposals ("RFP") for professional audit services and received seven (7) proposals in response by the May 14, 2018 deadline; and WHEREAS, after reviewing and considering each proposal and the information received during oral presentations and interview, the evaluation committee selected The Pun Group, LLP as the highest-ranking firm to provide independent auditing services to the City; and WHEREAS, The Pun Group, LLP is a certified public account firm and is qualified by experience and ability to perform the services desired by the City, and The Pun Group is willing to perform such services for Fiscal Years ending June 30, 2018 to June 30, 2020 with the option to extend the term of the Agreement for the two subsequent Fiscal Years. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of National City hereby authorizes the Mayor to execute an Agreement with The Pun Group, LLP for independent auditing services for the Fiscal Years ending June 30, 2018 to June 30, 2020 with the option to extend the agreement for each of the two (2) subsequent fiscal years. PASSED and ADOPTED this 17th day of July, 2018. Ron Morrison, Mayor ATTEST: Michael R. Dalla, City Clerk APPROVED AS TO FORM: Angil P. Morris -Jones City Attorney CITY OF NATIONAL CITY Office of the City Clerk 1243 National City Blvd., National City, California 91950-4397 619-336-4228 Michael R. Dalla, CMC - City Clerk THE PUN GROUP Independent Auditing Services Javier Carcamo (Finance) forwarded a duplicate original Agreement to The Pun Group.