Two Heads are Better Than One

Patrick Callahan, Snyder & Associates

Handouts and presentation are available online at www.iowaleague.org

The Definition and General Overview of Contract Operations

1. Independent contractor/another entity

2. Essential Services for residents

3. Support services for the city

Possible Reasons for Contracting for Municipal Services

1. City staff – lack the time or expertise

2. Limited nature of service

3. Regulatory requirements are complex

4. Employee turnover and retention

5. Shift liability to another entity

6. Considerable investment in equipment

7. Concerns regarding cost of employee benefits

8. General interest in reducing costs

9. Desire to streamline certain city services

Contract – Support Services

1.City Attorney or Bond Counsel Services

2.Auditing Services

3.Consulting & Engineering

4.Economic Development/Tourism Promotion

5.Emergency Response and Hazard Mitigation

Contract – Essential City Services

1.Water & Wastewater Operations

2.Police Protection/Law Enforcement

3.Public Works – Streets, Snow Removal & Street Cleaning

4.Parks & Recreation – Maintenance & Mowing

5.Library Services

6. Fire Protection/EMS Services

7. Radio Communications – Police, Fire, and EMS

8. Solid Waste Collection and Disposal

9. I.T. and Website Development

10. Cemetery Operations

11. Inspections and Code Enforcement

Potential Service Providers or Vendors

1.Private Companies or Businesses

2. County Government

3.Nearby Cities with staff, equipment, and facilities

4. 28E Entities or Organizations

Group Discussion – Review of Services and Options

1.Examples from your city

2.Positive features of your city’s experience

3. Issues and concerns

4.Today’s survey of cities – ILC website

The Decision Making Process on Contract Services

1.Identify the services and reasons for contracting

2.Review all the options and potential providers

3.Consider the pros and cons of each option

4.Basis for the decision – determine the goals and objectives

The Selection Process – Contracting Services

1.Review the Code of Iowa (Chapter 28E) and City Code

2.Review the Brooks Act – RFQ Procurement Process – Federal Funds

3.The process will vary depending upon the services and the potential providers

4. The Basic Options for Procurement

• Request for Qualifications (RFQ)

• Request for Proposals (RFP)

• Solicitation of bids – direct contact or advertisement

Request for Qualifications (RFQ)

1.Seek only providers who have the qualifications to provide the service

2.Solicit information on all the criteria and factors, excluding fees

3.Select the most qualified provider

4.Request a proposed fee from the most qualified provider

5.Negotiate the fee and contract for services

Request for Proposals (RFP) – Contract Procurement Method

1.Contents of RFP – description of the services

2.Consider both qualitative and quantitative measurements

3.Solicitation of proposals – “Who you gonna call?”

4.Level of experience and expertise required

5. Develop the criteria used to evaluate the proposals

6. Determination of fees and costs

7. Evaluation team reviews the proposals and conducts interviews of providers

8. Selection of the “best proposal” or provider for the service

Solicitation of Bids

1.Direct solicitation or advertise

2.Clearly define the services required

3.Selection of the lowest responsive and responsible bidder

The Written Agreement for Services

1.Define the services to be provided or set forth the duties

2.Include the city’s duties and responsibilities

3.Need for performance standards

4.Insurance coverages

5.Fee structure and payment schedule

6.Termination clauses

Independent Contractor vs. City Employee

1.Reclassify an “employee” as an “independent contractor”

2.IRS – 20 Point Test• Behavior control• Financial control• Type of relationship

3. Potential liabilities of misclassifying an employee as an independent contractor

4. Consult the City Attorney

Discussion – Tips & Suggestions on Municipal Contracting and Service Sharing

1.What has worked in your city?

2.What has not worked in your city?

3.Suggestions for other cities?

Final questions and comments

Patrick Callahan, Municipal ConsultantSnyder & Associatespcallahan@snyder-associates.com(319) 362-9394 Office(563) 599-3708 Cell