For City Council Meeting [February 12, 2019]
TO: Honorable Mayor and City Council
APPROVAL: Sean Grayson, Interim City Administrator
FROM: Jessica Brown, Finance Director
Title
Request City Council to Authorize of Purchase Order Change Notice (2019-0926) with Rahban CPA & Consulting in the amount of $35,000 to Provide Accounting Services in the Finance Department for Fiscal Year 2018/19 for a total Purchase Order of $85,000 and Approve Budget Resolution No. 7470.
(ACTION)
Body
BACKGROUND:
Beginning in fiscal year 2017-18 and into 2018-19, the Finance Department (Department) has experienced significant staff turnover. This combined with a decrease of four positions over the last five years has resulted in key financial tasks not being completed thus affecting 2018-19 accounting reconciliations.
On September 25, 2018 Council approved a $50,000 Purchase Order with Sharon Rahban CPA & Consulting to assist with the completion of 2017-18 bank reconciliations and journal entry review. In January 2019, Sharon Rahban CPA & Consulting completed the bank reconciliations for 2017-18.
ANALYSIS/DISCUSSION:
In January 2019, the Department’s only Accountant position became vacant. Additionally, due to unforeseen circumstances regarding the timely completion of the 2017-18 audit, additional staff resources are required to support the 2017-18 yearend close and audit. The Department seeks to continue utilizing the consulting firm to complete 2018-19 bank reconciliations and analysis to ensure the City’s financial records are up-to-date and accurate.
The contract services provided by Rahban CPA & Consulting, attached, will mainly assist the Finance Department by providing specific catch up work relating to bank reconciliations in 2018-19. Additional services provided on an as needed basis will include financial report preparation, grant reporting, and audit preparation.
ENVIRONMENTAL IMPACT:
Pursuant to Section 15378 of the California Environmental Quality Act, the proposed request is not a project. A ‘Project’ means the whole of an action, which has a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment. A project does not include the creation of government funding mechanisms or other government fiscal activities that do not involve any commitment to any specific project, which may result in a potentially significant physical impact on the environment or Organizational, or administrative activities of governments that will not result in direct or indirect physical changes in the environment.
GENERAL PLAN CONSISTENCY:
This action is consistent with Guiding Principle 3A in the General Plan:
Our City government will lead by example, and will operate in an open, transparent, and responsive manner that meets the needs of the citizens and is a good place to do business.
LEGAL REVIEW:
The City Attorney has reviewed and approved this staff report
FINANCIAL IMPACT:
Operating Budget Impact
The total cost associated with the approval of this item for the Purchase Order Change Notice is $35,000 for a total Purchase Order amount of $85,000. The temporary contract services are $85.00 per hour for a Staff Accountant and $125 per hour for a Certified Public Accountant, as specified in the quote from Rahban CPA & Consulting. An appropriation of General Fund reserves is necessary in account number 010-500-2151-2011. Resolution 5169 set General Fund reserves at a minimum level of 50% of the operating budget. The appropriation lowers General Fund reserves to 35% from 36% defined during the 2018-19 budget process.
Capital Improvement Budget Impact
There is no impact on the Capital Improvement Budget.
Licensing
Prior to execution of the Professional Service Agreement/Purchase Order/Construction Contract, the vendor shall submit a business license application and pay a Business License tax at the rate of $104.00, as well as Administration and State fees.
RECOMMENDATION:
Staff recommends that the City Council Authorize a Purchase Order Change Notice (2019-0926) with Rahban CPA & Consulting in the amount of $35,000 to Provide Accounting Services in the Finance Department for Fiscal Year 2018-19 for a total Purchase Order of $85,000 and approve the Budget Resolution.