HomeMy WebLinkAboutDELOITTE, HASKINS AND SELLS - 1985-03-18April 3, 1985
Deloitte, Haskins & Sells
701 "B" Street, W1900
San Diego, CA 92101
Attn: Mark Delane
The City Council of the City of Huntington Beach at its regular
meeting held Monday, March 18, 1985 approved an agreement with
your firm for assessment of purchasing/central services.
Enclosed is a duly executed copy of said agreement together
with a copy of the Certificate of Insurance which you submitted.
Alicia M. Wentworth
City Clerk
AMW:CB:t
Enclosure
CC: Robert Franz - Finance Department
Rick Amadril - Purchasing Manager
Wayne Lee - Finance
(7alaphono: 714.53E-5227 )
1 0 11MGf0N BEACH
�. CITY OF HUNT
2000 MAIN STREET CALIFORNIA 92648
OFFICE OF THE CITY CLERK
March 21, 1985
Deloitte, Haskins & Sells
701 "B" Street, #1900
San Diego, CA 92101
Attn: Mark Delane
the City Council of the City Huntington Beach at its regular
taeting held Monday, March 18, 1985 approved an agreement with
your firm for assessment of purchasing/central services.
When your Certificate or Insurance has been submitted to the City
and approved by the Office cf the City Attorney, the contract will
be executed by the City and a copy will be provided to you.
Alicia M. Wentworth
City Clerk
AMW:bt
Enclosure
CC: Robert Franz - Finance Department
Rick Amadril - Purchasing Manager
(Te!eptmne: 7 S 4-636.5227 )
REQUEA FOR CITY COUNCI ACTION
Date March 8,
Submitted to: IIo,-iorable Mayor and City Council
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Submitted by: Charles W. Thompson, City Administrato
Prepared by: Robert J. Franz, Chief of A Iministrative Service
Subject: Purchasing tissessment Contract
Consistent with Council Policy? [XI Yes [ j New Policy or Exception
Statement of Issue, Recommendation, Analysis, Funding Source, Alternative Actions, Attachments:
Statement of issue: The Administrative Services Department desires to conduct an assessme of the
City's purchasing operation, utilizing outside professional assistance to evaluate current operations
and develop recommendations for improvement.
Recommendation: Approve the attached contract :vlth Deloitte Haskins, & Sens for the development
of a Purchasing Assessment Program.
Analysis: The City's Purchasing operation was under the direction of the same Purchasing agent for
a 17 year period of rapid growth in city operations. The purchasing operation has remained somewhat
the same in terms of basic approach to providing service to departments. The current Purchasing
Manager has been responsible for this operation for over 2 1/2 years during which time a number of
improvements have been implemented. Recent appointments to vacant positions have brought the
division to full strength (10 employees including Print Shop and Mail operations) for the first time in 2
1/2 years. Staff feels the timing is excellent for an outside assessment of our operations so that
further improvements can be made in this important area.
There are two primary reasons an outside contractor or consultant is recommended for this project
instead of completing the project with city staff. The first reason is the expertise and independent
review that an outside firm would bring to the project. It would be difficult for city staff to acquire
the level of expertise required for this assignment, within a reasonable time frame. The second and
perhaps equally important reason is the ability of an outside firm to perform an in-depth assessment
in a relatively short amount of time (8 weeks). The recommended contractor estimates about 350
h.)urs of work for this project. It would not be possible to allocate this number of hours of city staff
time to this project over an 8 week time period without negatively impacting de;l-to-day operations
and services. It would be difficult to complete this project within 6-8 months if the project were
completed with city staff. Staff feels that this timing consideration, along with the expertise and
independence of an outside consultant, justifies the hiring of the recommended firm. The total
project cost of $20,500 is a relatively minor cost when compared to the potential savings that the
purchasing operation can generate.
The data and statistics provided below are an indication of the scope and complexity of the
Purchasing/Central Services operation, and provides some indication of the type of savings that can
occur when this operation is managed in the most efficient manner possible. This program will
review the following areas: Purchasing, Print Shop, Mail Distribution, Telecommunication, Office
Supply Inventory, and Salvage operations.
The Purchasing Division J es an annual budget of about $680,000 and is responsible for the processing
of over 5,000 Material Requisitions per year with a dollar volume of approximately $15,000,000 in
purchases. The Print Shop averages 550,000 duplications per month along with over -seeing 22 copiers
at various city locations. The City's Mail operation runs postage for Water Billing at a postage cost
of $48,000 per year, Business License at $8,000 per ,year, and regular city mail at $4.5,000 per year.
"he City currently leases a ROI,M CBX telephone system with 540 lines and 104 trunks. Over 40,000
outgoing calls per month are placed with an average of $4,300 per month of long distance charges.
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HONORABLE MAYOR AND R EST FOR COUNCIL ACTION
CITY COUNCIL MEMBERS PURCHA ,WEST
ASSESSMENT CONTRACT
Purchasing also maintains an office supplies inventory of approximately $14,000 and distributes
approximately $30,000 of supplies to the various departments per year. Salvage operation for the
City of Huntington Beach is the method by which departments dispose of all surplus equipment
and supplies. This operation generates approximately $30,000 per year of revenue to the City.
26 firms were requested to submit letters of interest in this project. Eight firms expressed
interest of which five met our minimum qualifications to submit proposals. One firm decided
against submitting a proposal.
The four proposals received were as follows:
FIRM
Ralph Anderson
Deloitte Haskins & Sells
Main Hurdman
Peat Marwick
PROJECT
COST STAFF
$19,071D
20,500
24,800
28,000
COMPLETION
SCHEDULE
12 weeks
8 weeks
10 weeks
8 weeks
After reviewing the four proposals, it is staff recommendation to contract with Deloitte, Haskins
and Sells. Their proposal meets the City's needs and objectives better than the other firms.
Deloitte, Haskins and Sells has put together an assessment team with varied and extensive
experience and expertise. The project staff that this "Big 8" accounting firm would assign to this
project has broader City and County experience than the other firms in terms of the day-to-day
management of a purchasing operation. Deloitte, Haskins and Sells also has technical expertise on
their staff in certain areas such as telecommunications that could prove to be of great assistance
to the City even though a relatively small amount of the total project hours would be allocated to
those technical areas. Lastly, the recommended contractor would complete this project in the
shortest amount of time which is a further benefit to the City in our planning and implementation
process.
Funding: Account 176390.
Alternative Action:
I. Select another firm from those who submitted proposals.
2. Do not approve hiring of consultant for the project and ask staff to conduct
in-house analysis of similar scope.
Attnehments:
1. Exhibit "A" Proposal for Purchasing Assessment Study.
2. Contract with Deloitte Haskins & Sells.
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Proposal for
Purchasing Assessment Study
City of Huntington Beach
J7inuary, 1985
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Table of Contents
Proposal for
Purchasing Assessment Study
City of Huntington Beach
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I.
Transmittal Letter
1
II.
Introduction
4
Overview: Government and Purchasing
5
Understanding of City's Needs
5
III.
Work Plan/Schedule
7
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IV.
Costs
18
V.
Project Management
i9
VI.
Staffing
27
Organizational Chart
30
Resumes
31
VII.
References
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I. TRANSMITTAL LETTER
Deloifte
Haskins+Sells
Suite 1900
®
701 "B" Street
San Diego, California 92101-8198
(619)232-6500
TWX 910-335-1573
Mr. Rich9rd Amadril January 15, 1984
Purchasing/Central Services Manager
PO Box 190
2000 Main Street
Huntington Beach, California 92648
Dear Mr. Amadril:
Deloitte Haskins & Sells is pleased to submit our proposal to
®
conduct a purchasing assessment study of the Purchasing/
Central Service Division for the City of Huntington Beach.
We understand your primary interest is to assure the city's
limited purchasing dollars are most effectively spent.
Further, the city's purchasing policies, procedures and
organization structure should promote the procurement of
quality goods and services. Our review can help insure those
objectives are met.
For several re ins, we believe we are uniquely qualified to
assist the City of Huntington Beach in this study:
Relevant Experience: We have performed management audit
engagements for various public sector organizations and
have extensive experience in the review of purchasing
operations in private industry and the public sector.
In particular we have recently completed similar work in
a management audit of the Purchasing and Stores
Department of Los Angeles County. Some of our
government clients include the County of San Diego, San
Diego Association of Governments, City of Carlsbad, City
of Orange, City of Irvine, San Bernardino County, City
of Chula Vista, and the City of ',os Angeles.
Quantifiable Savings: Our experience in similar
engagements shows a three to five fold return within the
first year, and a five to fifteen fold return over a
five year period. In our report we w= l quantify the
potential savings to the City based on implementing our
recommendations.
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Project Team: In order to conduct a purchasing
assessment study of ;your purchasing operation, you need
a variety of expertise. Our project team consists of
experts in purchasing policies and procedures,
organizational analysis and computer systems design.
In addition our consultants have been in government and
understand your unique problems.
Work Plan: To ensure consistent quality in our
projects, we have detailed a work plan which provides
documented deliverables and a review process at each
step throughout this project.
Firm (qualifications: We possess the extensive resources
of a Brig 8" a' ccounting/consulting firm in Southern
�+ California. Our Southern Pacific Government Consulting
Practice is based in San Diego with local offices in
both Los Angeles and Orange County. Consequently, we
can provide you with locally based consulting expertise.
Timing and Fees: We can start this job almost
im:nediatel upon award, and provide a quality product
for $20,500. We have based our proposal on an intensive
examination of your operation. We are willing to
undertake our review at a less intense effort if it more
closely parallels your needs. We would be swilling to
adjust our effort and fees, if you so desire.
We look forward to this opportunity to assist the City of
Huntington Beach. Should you have any questions concerning
our proposal, please feel free to contact either Mr. Frank
Panarisi or Mr. Mike McNamara at (619) 232-6500.
® Sincerely,
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Mark elane
Director
Management Advisory Services
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II. INTRODUCTION
0 Overview: Puchasing and Covernment
Materials management, including purchasing, is more
complex in government than in industry because of the
need to operate within a prescribed framework of laws,
to reveal pricing information and to use an open bidding
system. At the same time, because of the significant
impact purchasing has on the delivery of services to
citizens, it is critical that purchasing be operated in
a cost --effective manner. Productivity in purchasing
influences a large portion of a government's material
expenditure, the quality of goods and their timely
availability to users. In the City of Huntington Beach,
for example, approximately 15 million dollars of the
General Fund budget is spent by the Purchasing
Department for the purchase of materials and supplies.
Productivity in Government Purchasing should be measured
in terms of attainment of the following goals:
1) Obtain the optimum value for the purchasing dollar
expended
2 Coordinate the purchasing and materials management
0 activities in such a manner as to preserve the
integrity and honesty of operation
3) Supply needed materials, supplies and equipment in a
timely manner
® '+) Maintain fair and equitable relationships with
vendors.
5) Minimize the total cost of purchasing operations
b) Ensure maximum economic utilization of items on hand
0 prior to initiating purchasing
Our Understanding of Your Needs
In order to understand the major issues involved in the
proposed purchasing assessment program study, we have
® reviewed the Request for Proposal and held discussions
with City staff.
Based on this information, the City's objectives include
the following deliverables from the contractor:
0 Identify the current operation of the
Purchasing/Central Service Division.
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Review and assess the Division's staffing
.requirements.
® Determine current level of performance and problem
areas for the Division.
Review and assess the Division's contract procedures.
Review and assess the Division's warehousing
procedures.
Determine the responsiveness of the current:
operation..
® Design a conceptual Management Information System.
The work plan proposed in the following section will
investigate the issues listed above and make recommendations
for improvement. Where possible we will quantify the costs
and benefits associated with our recommendations.
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Iii. WORK PLAN/SCHEDULE
Our work plan includes four major tasks which are listed
below. We have also indicated the start and completion
date for each major task. We assume completion of the
project within a 60 day time frame. These estimates are
based upon an assumed start date of February 4, 1985.
They would be adjusted based upon our actual contract
approval and start date. Each task is discussed in
detail on the following pages.
Task 1: Organize Project
Task 2: Review Current Purchasing/Central Service
Division Program
Task 3: Review Purchasing/Central Service Division
Information System
Task 4: Prepare Final Report
Task 1: Organize Project - Start 2/4/85 Complete 2/4/85
1.1 Meer_ with City staff
Our staff will meet with the Chief of
Administrative Services, Director of Finance,
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Purchasing/Central Service Manager and other
appropriate city staff, who will administer and
supervise the contract, to discuss the work plan,
schedule roles and deliverables, including the
number of status reports required.
1.2 Finalize work plan
We will detail all work plans, finalize
admixiistration and reporting, and review schedules
for our project staff.
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Task 2: Review Current Purchasing Central Service
Division Program - Start ?_ 5 85 Complete 2%'22%$5
2.1 Review existing administrative and legal
documentation
All existing documentation on the
Purchasing/Central Service Division will be
collected and reviewed, including:
City Charter and Municipal Code Requirements
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and other legal requirements
Administrative regulations, >>olicies and
procedures
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Organization chart(s)
® Record keeping procedures/forms
Training procedures/requirements
The above documentation will be reviewed for an
understanding of the current system's
administrative and legal requirements. In
addition, any major deficiencies in existing
policies or procedures will be noted.
While the Purchasing/Central Service Division will
be the primary focus, any documentation regarding
interfaces with other City departments will be
reviewed.
The current organizational chart and job
descriptions will be reviewed fQr understanding of
the current personnel staffing levels,
responsibilities and reporting relationships.
2.2 Interview City personnel
We will interview Purchasing/Central Service
Division and other key City personnel to further
the documentation of purchasing operations. In
addition to Purchasing/Central Service Division
representatives, representatives of the
Administrative Service's Office, Finance
Department and Data Processing Department will be
interviewed.
The interviews will be conducted using the
structured interview questionnaire developed by
our Firm for reviewing purchasing operations.
However, the questionnaires would be modified to
meet the needy of the City's Purchasing/Central
® Service Division.
The following purchasing functions will be
reviewed during the interviews:
Market review and analyses
Requisitioning
Preparation of specifications
Bidding, vendor evaluation and selection
Negotiation of purchases
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Contract monitoring
Order follow-up
Quality control/testing
Accounts Payable interface
Telecommunications
Salvage operation
Warehouse effectiveness
Long term contracts
negotiation/award/monitoring (e.g. blanket
purchase oraers)
Purchasing audit trails
Voucher audit procedures
The interviews will document the actual practices
and procedures now used by the Purchasing/Central
Service Division, the role and training of the
respondent, and relationships with user
departments and accounting. Records and forms
used for the above fulctions will also be
collected and reviewed.
Analysis of the above documentation will focus on
the extent to which purchasing provides an
adequate level of service at an acceptable cost.
2.3 Survey user department representatives
Using a structured questionnaire, we will survey a
sample of user department representatives. The
sample of user departments will be based on the
following criteria: budget for supplies and
materials and equipment, number of requisitions
processed, and the dollar value o:" purchases.
The survey will assess purchasing performance
®
impact on operations and major problems. Some of
these issues might include:
timeliness (processing of requisitions,
purchase orders and delivery of goods)
®
communications
price of goods received
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quality of goods received
back orders
administrative "red tape"
adequacy of staffing levels
Wherever possible, problems which have a major
negative dollar value on a department will be
quantified
2.4 Survey vendors
A questionnaire will be developed for surveying a
sample of vendors. The sample will be developed
from mailing lists of potential vendors, lists of
vendors who have actually bid in the recent past
and lists of vendors who have actually done
business with the City in the recent past.
While the sample will represent a variety of
vendors, a significant number of construction
contractors will be contacted to ensure an
adequate response regarding construction contract
procedures.
The vendors will be asked to assess the City's
contract procedures in terms of:
bid specifications
selection criteria
selection procedures
adequacy of purchase orders
knowledge of and cooperation of purchasing
staff
clarity of purchasing policies and procedures
timeliness of payment
contract monitoring
change orders
2.5 Analyze Purchasing/Central Service Division
Performance Indicator Data
Based on the availability of data, we will assess
the performance of the purchasing system using
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various quantitative measures. These measures
when used with interview and survey information,
may indicate problem areas. Related to system
efficiency and effectiveness, these measures
evaluate timeliness, quality of service, savings
and price and impact on users of purchasing
activities. A sample of some of the measures
which may be used are shown below:
Average time to process and purchase from
origin of initial. written department
requisition to the issuance of the purchase
order.
Average time to process from receipt of
departmental requisition to issuance of award.
Average time to process request for a contract
item.
Number of stockouts compared to the number of
requests for stocked items from the
warehouse (s).
Value of purchase order requirements contracts
compared to the value of purchases through
central purchasing.
Operating costs of central purchasing
department compared to the value of purchases
through central purchasing.
Total operating cost for purchasing management
compared to the value of purchases through
central purchasing.
Operating cost for buyer compared to the value
of purchases through central purchasing.
Total operating cost for clerical support
compared to value of purchases through central
purchasing.
Average time to process an urgent requisition.
Line items processed to bid plus line items
awarded compared to person -hours.
Average age of requioitions held by buyers.
Number of shipments rejected for quality
compared to the number of shipments.
Number of line items not shipped compared to
the number of line items ordered.
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Number of contracts not starting on time
compared to total contracts.
Number of contracts with cost
overruns/underruns compared to total number of
contracts let.
2.6 DELIVERABLES
Measurement of the key indicators of current level
of performance for the Purchasing/Central Service
Division Operation to be used in analyzing the
current effectiveness of the program.
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Task 3: Review Purchasing/Central Service Division
Information System - Start 2 20 85 Complete 3/4/85
3.1 Review current record keeping and information flow
The Purchasing/Central Service Division manual and
automated information systems will be --eviewed to
determine the adequacy and accuracy of the data
base, ease of accessibility, and the capability to
easily generate management information required
for:
Accountability and control of purchasing
activities
Measurement of purchasing performance (from
the point of view of the Purchasing Agent,
Chief of Administrative Services, Finance
Director, and othei City members)
Audit trails
Operations support
Contract monitoring
In order to evaluate vendor performance and follow
up on problems, the Purchasing/Central Service
Division must receive adequate and timely feedback
from other areas. DH&S will evaluate how the
information system interfaces with other areas and
specifically determine how:
Receiving discrepancies such as damaged or
incorrect material, wrong quantities and/or
delivery dates, and lack of proper open
purchase order documentation are reported to
purchasing by the receiving function.
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Quality discrepancies, including the frequency
of failure in receiving inspection and
problem experienced by user departments are
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reported to purchasing by quality control.
Invoice discrepancies, such as incorrect
pricing or payment terms are reported by the
accounts payable function.
Vendor performance is measured over a
predetermined time period and analyzed for
trends rather than based on isolated reports
of good or poor performance.
Deloitte Haskins & Sells recognizes that
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achievement and maintenance of an effective and
efficieL.t purchasing system requires that the
performance of the purchasing function be
monitored and measured. We will evaluate how the
information system is used to measure purchasing
performance in several areas:
®
Since vendor selection and evaluation is a
primary function of purchasing, DH&S will
evaluate how vendor performance is used to
measure purchasing performance.
DH&S will determine if management accounting
reports compare actual purchased material
costs to predetermined standards to measure
purchasing performance.
DH&S will determine if actual inventory levels
and dollarized receipts are used to measure
purchasing performance against budgeted
standards.
Finally, purchasing may be measured on its
ability to achieve cost reduction objectives
through negotiation, value analysis and source
development. We will evaluate how the
information system is used to measure these
areas.
Other examples of areas we will evaluate include,
but are not limited to, the:
Ability to provide status and tracking of
requisitions and open purchase orders.
Ability to provide messages to "take action"
or "review exceptions" on material needs and
purchasing report.
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Ability to provide expediting messages for
materials scheduled for delivery beyond "need
date."
Ability to provide documentation,
administration, and reporting for Bid/Quote
system before orders are placed and a vendor
is selected.
Ability to automatically generate purchase
orders once the requisition is approved.
Ability to generate:
a. blanket orders by time and by dollar
b. multiple release date orders
C. service contracts
d. multiple delivery site orders
Ability to provide history on blanket orders.
Ability to record vendor acknowledgements and
update purchase orders for price changes, date
changes, cancels, adds, etc.
Ability to monitor performance of contracts
against the RFP and subsequent purchase order.
Ability to track vendor performance for
on -time delivery, price increases, terms,
quality level, and o,terall performance.
Ability to provide purchase item history
including past vendors and substitute
materials.
Ability to calculate economic order quantities
(EDW and/or lowest cost decision.
Ability to provide receiving documents and
provisions for partial receipts, inspections,
and material disposition transactions.
Ability to provide documentation for materials
to be returned to vendors (i.e. rejected
goods, surplus, reworked materials).
Ability to provide work -files for developing
costs, generating requisitions, and planning
purchase orders.
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Ability to generate and maintain price
variance data (i.e. to target, to original
purchase order, to last actual, to standard).
Ability to provide ABC analysis on purchased
items.
Ability to provide for manual adjustment
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before generating the purchase order.
Ability to have multiple vendors and multiple
terms and prices for each item.
Ability to provide for subcontract order
tracking and control.
Ability to control and report on returnable
items such as containers, pallets, etc.
Our review of the information, system will also include
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evaluating the cost effectiveness of automating manual
procedures and the efficiency of procedures currently
automated.
3.2 DELIVERABLES
A review of the current data processing/MIS
reporting systems and recommendations for
improvement and/or redesign.
Design of a performance reporting system that will
be used for long term management information.
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Task 4.0 Prepare Final _Report - Start 3/5/85 Complete 4/1/85
Based on our documentation and analysis of the City
purchasing operations and the purchasing :information system,
we will prepare a final comprehensive report which includes,
but is not limited to:
1. Overview of study methodology aid objective.
2. Overview of Purchasing/Centr.ai Service Division
operations and recommended changes.
3. Findings and recommendations regarding procurement
policies and procedures, organization and staffing,
information system and performance measurement. It is
our policy to provide cost estimates of major
recommendations wherever possible.
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4.
Review of current operations and recommendations for
improvements of purchasing approaches to:
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expediting and follow-up
contractual procedures
cost improvement and cost reduction program
warehousing
responsiveness
5.
Review and recommendations on improving your equipment
acquisition schedule for multi -department items such as
vehicles, typewriters, etc.
6.
Review and recommendations regarding the City's process
for paying vendors. This review would examine the use
of negotiated terms and the timing of the payments to
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assure the best utilization of City funds.
7.
Review and recommendations on the Purchasing/Central
Service Division Methodology of determining savings
obtained through centralized purchasing.
8.
Recommendations to management on methods of monitoring
the effectiveness of purchasing in the future.
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IV. Costs
0 The following identifies the labor hours and an estimate of
the costs associated with each of the major tasks of the work
plan:
Task Hours Cost
1. Organize Project 12 $ 900
2. Review current Purchasing/Central
Service Division Program 200 11,000
3. Review Purchasing/Central Service
Division Information System 42 2,100
4. Prepare Final Report 92 5,000
Total 346 $19,000
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In addition to labor costs we estimate our out-of-pocket
expenses to be $1,500.
Total cost for the project will therefore be:
G Consilting Fee $19,000
Expenses 1,500
Total Fea $20,500
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V. Project Management
Project Supervision and Monitoring
Deloitte Haskins & Sells' approach to the management of
complex projects is to organize the work into a logical
sequence of related tasks of controllable size. Each task
has its own clearly identified functions and deadline. In
most cases, there is a final product which, when produced and
approved both by project and client management, indicates
that the task is complete. In this way, progress is clearly
measured and controlled throughout the life of the project.
I Several project control tools are used to report progress to
® project management at frequent intervals. This project
management and control approach has proven successful in all
of our recent engagements. Copies of our project control
forms are included at the end of this section.
Exhibit A
The Work Plan and Time Estimate form breaks down the Task
Work Steps and details the estimated hours for each. Columns
are provided for time frames and for separation of the work
by several individuals. This plan, summary is the basic tool
for subsequent project control. We will complete it to
® outline the basic work plan for the project once we are
notified to proceed.
Exhibit B
The Actual Time Summary tracks the actual time expended
against each element of the work plan by period and by staff
member. This is posted weekly.
Exhibit C
The Engagement Progress Report sets forth for each segment of
the total work plan the budgeted man-hours, actual hours
expended to date, hours available to complete, current
estimates of the number of hours required to complete, and
expected number of hours this segment will be over or under
budget. This is prepared every four weeks.
Exhibit D
The Engagement Status Report normally submitted every four
weeks, summarizes the engagement as a whole, presenting the
engagement milestones just completed, and those to be
accomplished next, and compares expenditures to date with
those estimated.
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Exhibit E
The Daily Activity Report is submitted every two weeks by
each consultant involved, and records, like a diary, the
activity of each person assigned to an engagement. Each
interested supervisory. -level party may review this report and
keep informed as to the nature of the work completed during
the two -week period. Naturally, any problem areas would have
been reported promptly, not waiting for the end of the period.
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�0RM MAS 20 12.7g
S ENGAGEMENT PROGRESS REPORT EXHIBIT C
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Work Plan Summary �a,dgetae9 t®fete To Comptatm To Complete ®var fUnderi
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FORM MAS 70 12-78
0 MAS ENGAGEMENT STATUS REPORT
EXHIBIT D
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Client
Supervising Partner
Engagement Number
Four Weeks Ended
No.
Engagement Milestone
Completion
Date
Met?
Yes
No
Current Period
Next Period
Scheduled
Dates
Current Period Charges
Hourly
Rate
Hours
Charged
Services
Expenses
Totals as Shown on ED Run of
Estimated Charges to Date
Estimate To Complete And Billing S^.atus
Services
Expenses
Total
Billed Through
Unbilled
Suggested Billing
To Date
Estimate
To Complete
Total at
Completion
Quote/Estimate
Given Client
Percent of Std.
Per. Eng. Memo
Suggested Change
Dates of Latest Discussions with Key Client Executives:
1. Are any fee problems anticipated?
2. Are scope or staffing requirements changing?
3. Are any other problems foreseen?
Yes
No
Prepared By: Date
RevieweJ By: Date
MAS DAILY ACTIVITY REPORT EXHIBIT E
t
FORM MAS 30 12.78
Page_ of —
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Client
Office _
Consultant
Engagement Number
Supervising Partner _
Period Ended
Date Hours Task Activity
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Dir. Sup.
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VI. STAFFING
We have assembled a project team with pertinent experience to
meet the requirements of this project. We have selected
experienced managers to provide proper project management and
coordination. The consultants we have chosen have specific
experience in government, management audits, purchasing, and
automated systems, in order to meet the demands of this
project.
Mr. Frank Panarisi will act as the Firm principal
responsible for the engagement. Mr. Panarisi, who has
twenty-seven years' experience in all aspects of public
administration, including purchasing, will provide
project supervision and review, in :seeping with our
Firm's quality control objectives.
Mr. Michael McNamara, who has several years' experience
as Administrative Services and Finance Director for the
Cities of Irvine and San Clemente, will act as Project
Manager for the engagement. He has had administrative
responsibility for purchasing and will ensure the proper
coordination and provide both technical and project
management assistance to ensure that the deliverables
proposed to the City of San Diego are completed in a
timely and efficient manner.
®
Mr. William F. Klein, who has specific expertise in
assessment of purchasing procedures in the public
sector, will act in a technical advisory capacity on the
project. Most recently, Mr.. Klein wrote a purchasing
procedures manual for the Long Beach Public
®
Transporation Company.
Ms. Joan Martin will serve as the primary consultant on
the project. Ms. Martin has fourteen years' consulting
experience in the public and private sectors, and has
specific expertise in management audits and system
requirements analysis. Most recently Ms. Martin
conducted a management audit for the Los Angeles County
Department of Purchasing and Stores. Prior to joining
Deloitte Haskins & Sells, Ms. Martin worked for Science
Applications, Inc. There she was responsible for
reviewing all corporate financial and management
systems, including purchasing for this $300 million
annual revenue corporation.
Mr. John Neubauer, Manager with DH&S will also serve as
a technical advisor. Mr. Neubauer has eighteen years
experience in operations, manufacturing and systems for
both national and multi -national companies. He has had
extensive experience in planning, purchasing, inventory
control distribution, ar.d systems development. Prior to
joining DH&S, Mr. Neubauer was Manager of Management
Information Systems in Bausch & Lomb, Inc.
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In addition to the above primary staff, we have included the
resumes of consultants who may participate if additional
® consultant assistance is required for this project. These
consultants include: Gwyn Hartman, Laurie Barrington,
Malcolm Carlaw and Mike Ford.
We would also propose that the City designate a review
committee to work with DH&S to refine our detail work plan,
® identify appropriate interviewees and monitor our progress.
We would expect a time commitment of two or three meetings
lasting one to two hours. We would expect to use the City
clerical staff for only scheduling meetings and interviews.
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The following Organization Chart outlines the roles,
reporting relationships of the project team, and estimated
percentage of total project time each individual will devote
to the project. Resumes for each of our project members
follow the organization chart.
City Coordinators:
- Chief of Administrative
Services
- Director of Finance
- Purchasing/Central
Service Manager i
t ds
City Review
lie I Committee
040
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DH&S Project
Director
Frank Panarisi
Project Manager
Michael McNamara
Technical Advisor's
William Klein &
John Neubauer
Consultant Consultant Consultants
Gwyn Hartman Joan Martin as needed
-Laurie Barrington
-Michael Ford
-Malcolm Carlow
1�
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FRANK PANARISI
Project Manager
Experience: Mr. Panarisi joined Deloitte Haskins & Sells in
March 1983 after twenty-seven years as a public
administrator. His public service included
fifteen years with the County of Los Angeles and
twelve years with the County of San Diego. Mr.
Panarisi has held a unique variety of executive
positions which have spanned the full range of
county services. He has the direct experience
of coping with the many challenges faced by
local governments.
®
Mr. Panarisi provides his knowledge of Local
government and the important part it plays in
the community. His background includes
experience as Assistant Chief Administrative
Officer, San Diego County,, with direct
responsibility for all appointed departments
including: Purchasing, Health Services,
Probation, Defender Services, Social Services,
EDP, Public Works, Planning, Animal Control,
Parks, Public Administrator, Revenue and
Recovery, Registrar, Coroner, General Services
Library, and Housing and Air Pollution Control,
Also, he had coordination responsibility for the
Sheriff, District Attorney, Superior and
Municipal Courts, and all other elected
departments.
He directed the centralization of a contracting
process in the Purchasing Department for San
Diego County, and directed purchasing for a
major Los Angeles County hospital.
Among the many positions he has held are
President of County Health Care Administrator's
Association of California, Assistant Chief
Probation Officer for Los Angeles County,
Assistant Executive Officer of the Board of
Supervisors in Los Angeles County, Chairman of
the San Diego County Data Processing Policy
Committee, President and Board member of the San
Diego Criminal Justice Planning Board, and
Chairman of the San Diego County Audit Committee.
Since joining Deloitte Haskins & Sells, Mr.
Panarisi assumed the role of our Firm's
®
Coordinator of Southern California Consulting
Services to Public Sector clients.
C7
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FRANK PANARISI
He also served on various National Association
of Counties committees, the Policy Committee on
Administration of Justice for County Supervisors
Association of California, the President of the
County Health Administrators Association of
California.
For two years, he was a facilitator for the
National Leadership Institute - "Managing
Diminishing Fiscal Resources in Corrections"
Academic
Background: Bachelors of Arts, Occidental College
Masters of Public Administration, California
State University, Los Angeles
Professional
® Activities:: Mr. Panarisi is a member of:
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California Municipal Treasurer's Association
Municipal Finance Officer's Association
San Diego Chamber of Commerce - Member,
Government
Advisory Council
San Diego Rotary
United Way - Board of Directors
Big Brothers of San Diego - President
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R. MICHAEL MCNAMARA
Project Manager
Experience: Mr. McNamara is currently a manager with our
Government. Consulting Practice in San Diego.
Prior to joining Deloitte Haskins & Sells, Mr.
McNamara served as the Director of Administrative
Services for the City of Irvine, California for
four years. As Director, Mr. McNamara served as
the City's Finance Director, Personnel Director
and City Treasurer, responsible for planning,
organizing, and directing General Support Services
(Purchasing, Central Stores, Word Processing,
Duplicating and Records Management); Management
Services (Personnel, Budget Preparation/Research,
Risk Management, and Data Processing); and Finance
(Accounting, Business Permits, City Treasurer and
revenue collection activities).
From 1979 to 1980, Mr. McNamara served as Finance
Director for the City of San Clemente, California,
and was responsible for the overall planning,
organizing, and directing of the City's financial
operations. This included responsibility for
preparation of a $13 million budget and management
of accounting, data processing, purchasing,
warehouse, utilities, including payroll, State and
Federal subventions and grants, and preparation of
the annual financial statement.
Mr. McNamara also served as Assistant to the Chief
® Administrative Officer, County of San Diego.
Prior to Mr. McNamara's public management and
finance experience, he served as Financial and
Production Manager for Teleayne Systems Company in
Los Angeles, California, where he was Financial
Manager for a $15 million microelectronics
business, and responsible for planning,
implementation, and budget control of projects,
including the F-14 aircraft computer.
Mr. McNamara also served as an Intelligence
® Officer for the U.S. Army.
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R. MICHAEL McNAMARA
Academic
Background: MBA - Pepperdine University
B.S. - Eastern Michigan University
Professional
Activities: County of San Diego Management
Development Program
President, American
Society for Public Administration
Member, Western Governmental Research Association
Member, Government Finance Officers' Associations
of California and North America
Member, Municipal Treasurer's Association
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JOHN S. NEUBAUER
Technical Advisor
Experience: Mr. Neubauer is a Manager in our Los Angeles
Management Advisory Services Group. His
experience includes eighteen years in operations,
manufacturing, and systems in diverse product
companies, multi -national and domestic.
His experience has been in the review, selection,
installation, and implementation of complete
manufacturing and financial systems in job shop,
repetitive, and process applications. As a line
manager, his responsibilities included designing
and maintaining effective product distribution,
cost savings programs, engineering charge systems,
inventory reduction systems, MRP implementation
planning, project management and shop floor
control systems. Prior to joining Deloitte
Haskins & Sells, Mr. Neubauer was a line manager
over a diversity of lines of businesses in
production, operations, and corporate positions.
He was responsible for planning, inventory,
purchasing, distribution, warehousing, production
control, systems, data processing, and systems
development activities for Bausch & Lomb's Inc.,
European distribution.
Academic
Background M.B.A., Finance & Economics, Pepperdine University
B.A., Languages, Rippon College (Wisconsin)
Diploma, Languages, University of Madrid (Spain)
Professional
Activities: Mr. Neubauer is a member of the National
Association of Purchasing Management, EDP Audit
Association, is certified in production and
inventory management of the American Production
and Inventory Control Society, and is a member of
the Institute of Management Consultants.
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WILLIAM F. KLEIN
Technical Advisor
Experience: Mr. Klein, who has been with our firm for one
year, has more than seven years of professional
experience in strategic planning, financial and
operational analysis, operational and capital
planning, program management, and
intergovernmental relations.
Mr. Klein is Currently participating in our
project to conduct a needs analysis as the first
phase of the City and County of San Francisco's
plan to develop a Citywide capital assets
management system. In this engagement he is
conducting the needs analysis for the City's
Purchasing Department. Additionally, he is
assisting the Long Beach Public Transportation
Company with the development of a procurement
policies, standards, and procedures manual. Mr.
Klein is also managing our organization, strategic
I-,lanning, and infrastructure study engagement with
the Ohio Department of Transportation. In
addition, he is assisting the Utah Transit
Authority with a strategic planning project.
Before joining our firm, Mr. Klein was the Manager
of Intergovernmental Relations for the Regional
Transportation District of Denver. His
responsibilities included the direct supervision
of staff engaged in planning, programming, policy,
budgetary, and contract analysis; grants
administration; environmental impact assessment;
and minority business enterprise programs. Mr.
Klein's responsibilities also included
coordinating RTD's strategic planning and short
range transit development plan process.
Mr. Klein was also employed by the Orange County
Transit District as Program Administrator and
Analyst. As a member of the District's
development team, he was primarily responsible for
the administration of federal and state financing
for capital and special projects.
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WILLIAM F. KLEIN
Academic
Background: BA degree, University of California, Santa
Barbara
MPA degree, California State University, Long Beach
MS degree in Systems Management, University of
Southern California.
Professional
Activities: The Institute for Managerial Accounting
The American Society for Public Administration
(Sections on Public Finance and Intergovernmental
Relations)
El
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JOAN K. MARTIN
Consultant
Experience: Ms. Martin has fourteen -ears' experience in
consulting and program management for government
and private corporations, In the government area,
Ms. Martin has consulted with Federal and state
agencies, special distrizts, councils of
government, counties, and municipalities.
Specific responsibilities have included: market
and systems research; feasibility studies; program
evaluation; survey work; organizational and
operations analysis; establishment of management
information systems; and endowment and grant
management.
Ms. Martin joined Deloitte Haskins & Sells as a
Senior Consultant, Management Advisory Services,
in 1984. Her major responsibility includes
consulting to local governments in the areas of
information systems, strategic planning,
organizational analysis, program evaluation, and
feasibility studies. Ms. Martin's clients include
the County of San Diego, the City of Henderson,
the City of Los Angeles, and the County of Los
Angeles. Most recently, she completed a survey
and management audit for the County of Los Angeles
Purchasing and Stores Department.
Prior to joining DH&S, Ms. Martin was a Senior
Internal Consultant with Science Applications,
Inc., 1,a Jolla, California, a corporation with
annual revenues of $300 million. At that time,
she was responsible for analyzing the corporate
accounting and administrative functions, including
purchasing, in order to develop an automated
management information system.
For six years, Ms. Martin served as a Director
with the San Diego Association of Governments. In
this capacity she was responsible for planning,
directing, and controlling the review of grant
requests for public and private organizations
totalling, $300 million annually in the areas of
health, employment and training, human resources,
urban facilities, housing, transportation, law and
criminal justice, energy, environment, and
information systems.
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JOAN K. MARTIN
Ms. Martin was a Management Systems Consultant for
the Center for Research, Inc., Rochester, New York
from 1970 - 1976. Her major responsibilities
included planning, directing and controlling
research and evaluation contracts with the private
and public sectors. Contracts included management
audits and organizational studies, review of
internal information systems and procedures,
assessment of public and private services, surveys
of local government, and legislative analysis. In
this capacity Ms. Martin evaluated various
administrative functions of local governments and
non-profit agencies.
Academic
Background: B.S. degree, LeMoyne College
M.A. degree, State University of New York, School
of Public Affairs
Professional
Activities: California Municipal Finance Officer's Association
American ranagement Association
United Way - Strategic Planning Committee
H
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GWYN L. HARTMAN
Manager
Management Advisory Services
PUBLIC ACCOUNTING
EXPERIENCE: Four years of consulting experience comple- mented
by several years of experience in industry and
local government.
MAJOR CLIENTS
SERVED: Freedom Newspapers
San Bernardino County Medical Center
40 Pacific Mutual Ir.surance
Nissan Motor Acceptance Corporation
National Medical Enterprises
RELEVANT
EXPERIENCE: During the past eight years, Ms. Hartman has been
involved in the planning, design, implementation
and evaluation of data processing systems.
Specific technical experience includes:
Analysis of system requirements, pre- paration of
Request for Proposal, and evaluation of vendor
® responses in several industries, including manufac-
turing, health care, local government, and a port
authority.
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Preparation of a five-year data processing plan for a
rapidly growing finance company.
Served as project manager for the implementation of
new application soft- ware packages including payroll
and accounts receivable systems.
Development of a modeling system used to analyze
financial and medical data of the patient population
(case mix) within a hospital.
Review of various data processing facilities to
evaluate existing systems and determine strengths and
weaknesses in internal control.
- 40 -
Analysis of existing manual
systems to determine the
appropriateness of auto- mated
systems.
Design and implementation of
custom manufacturing systems
including shop floor scheduling,
cost accounting, and physical
inventory.
Design and implementation of
custom municipal information
systems including financial
systems, management reporting
systems, and police and fire
dispatch- ing systems.
EDUCATION: University of California, Irvine
Bachelor of Science, Information and
Computer Science •- 1977
Pepperdir_e University
Master of Business Administration -
1980
CERTIFICATIONS: Certificate in Data Processing
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MALCOLM CARLAW
Experience:
Mr. Carlaw is a manager in our Orange
County office. Since joining DH&S, he
has performed an inventory reduction
study for a major aerospace company;
investigated and outlined the
engineering, financial, and
administrative system requirements for a
major energy company; outlined the
manufacturing and financial system
requirements for a made -to -order
equipment manufacturer; designed a cost
accounting system for a made -to -order
manufacturing environment; performed an
alternative cost analysis for an
equipment company; developed charge -back
guidelines for the data processing
department of a major automotive company
with a diverse user environment;
perfor^.ed a data processing controls
review on the insurance renewal and
payroll departments of a major insurance
firm; and performed a financial
feasibility Study for the extension of a
200 bed hospital.
Academic
Back,}round:
M.B.A., University of California
B.A., San Francisco State University
Professional
Activities:
Mr. Carlaw is certified in production anc
inventory management by the American
Production and Inventory Control Society.
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LAURIE C. BARRINGTON
Experience: Ms. Barrington is a consultant in the Oran
County Management Advisory Services Group. Her
experience includes six years in manufacturing,
accounting, and cost and operations systems.
While with Deloitte Haskins & Sells, her
consulting engagements have involved the selection
and implementation of management information
systems for advanced technology companies.
Ms. Barrington has considerable experience in the
design, selection, and implementation of
io integrated information systems. Significant
recent experiences in this area include project
management and implementation of cost accounting,
MRP-II, and financial applications for two
manufacturers of computer systems; design and
® installation of a custom work -in -process physical
inventory system for ? computer manufacturer;
design and implementation of a process cost
accounting Rystem fo•: a printed circuit board
manufacturer; and otter system -related engagements
for manufacturing, R and D, and services companies.
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Prior to joining Deloitte Haskins & Sells, Ms.
Barrington was an Application Consultant with a
data processing services firm. Her
responsibilities included project management
during implementation of manufacturing and
financial applications for clients, as well as
design of custom sub -systems and customer
education. Ms. Barrington also has experience in
the direction and supervision of general
accounting and financial reporting for a
manufacturing firm.
Academic
Background: B.S, Business Administrattion/Accounting,
California State University, Long Beach
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MICHAEL R. FORD
Experience; Mr. Ford joined Deloitte Haskins & Sells in August
of 1984 after completing a dual Master's degree
program at Ohio State University. While atending
graduate school, Mr. Ford worked directly with
both state and local governments on a variety of
I�
projects.
I
Mr. Ford assisted in performing a computerized
cost/benefit analysis on the Midday Fare Structure
for the Central Ohio Transit Authority. In
addition, he has assisted in developing a public
land information system for the City of Columbus,
Ohio. Both projects included collecting,
tabulating and analyzing data.
Prior to joining Deloitte Haskins & Sells,
®
Mr. Ford worked as a full time student intern with
the Ohio Department of Development. Specific
responsibilities included: assisting in the
preparation of `,he annual performance report to
H.LT.D, for Fiscal Year 1982 Ohio CDBG program;
automated the Fiscal Year 1983 Ohio CDBG files;
®
assisted in designing a Fiscal Year 1983 Ohio CDBG
Management Information System; prepared the 1983
Annual Report for Ohio Metropolitan Housing
Authorities; and assisted in the 1983 Ohio Housing
Needs Plan.
Since joining Deloitte Haskins & Sells, Mr. Ford
has worked as lead consultant for two
engagements. He recently finished an engagement
with San Bernardino County in which he assisted in
preparing a cost/benefit study on the transfer of
the Child Support Program to the District
Attorney's Office. He is currently lead
consultant on an engagement to perform various
management and fiscal audits for the Los Angeles
County Grand jury including a review of the
counties contract and budgeting process.
Academic
Background: Bachelor of Arts in Political Science, Bowling
Green State University, Ohio.
Master of Arts in Public Administration, Ohio
State University.
Master of City and Regional Planning, Ohio State
Univeristy
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VII. FIRM QUALIFICATIONS/REFERENCES
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VII. FIRM QUALIFICATIONS/REFERENCES
® Deloitte Haskins & Sells, International
Deloitte Haskins & Sells is one of the largest public
accounting and management consulting firms in the world. Our
international organization includes over 26,000 people with
400 offices in 71 countries. Here in the U.S., we have 100
offices, nine of which are in California.
The personnel in our practice offices are supported by the
total nationwide resources of our Firm. These resources
include the Technical Research Department of our Executive
Office in New York City., or National Affairs Office in
Washington, D.C., and our designated industry specialists in
virtually all areas of the economy.
Deloitte Haskins & Sells has made a strong commitment to
render the highest quality service to the public sector and
to provide our clients with responsive, personalized
attention. We have focused substantial resources on meeting
and diverse and specialized needs of our clients, including
the Federal, state, county and city governments, special
districts and educational institutions.
We have participated at all levels of the industry, including
performing audit and tax engagements, financil management
advising, designing and integrating data processing systems,
sflecting and implementing hardware and software systems,
analyzing organization structures, performing human resource
studies, and reviewing government operations.
As a result of our dedication and service to the public
sector, we have earned an excellent reputation. We are
particularly proud of our diversified clientele and the broad
base of experience we have achieved both here in Southern
California and throughout the country. We believe our
extensive expel ence will prove especially useful to the City
of Huntington 'ueach.
Public Sector Clientele
City of Los Angeles
County of Los Angeles
City of San Diego
City of Chula Vista
City of Carlsbad
San Diego Transit Corporation
City of Henderson
Riverside County
San Bernardino County
gity of San Francisco
County 4£ San Francisco
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Imperial County
Maricopa County, Arizona
Arizona Department of Finance
California State Lands Commission
Southern California Association of Governments
San Diego Association of Governments
Ramona Unified School District
Orange County Transportation Commission
Orange County Flood Control District
San Diego South Bay Union School District
San Diego Community College District
Orange County Department of Social Services
Tucson Airport Authority
Monterey County
Napa county
®
San Joaquin County
Alameda -Contra Costa Transit District
City of Alameda
City of Emeryville
City of Walnut Creek
County of Monterey
County of San Benito
County of Santa Clara
County of Santa Cruz
County of Stanisla.us - Scenic General Hospital
East Bay Dischargers Authority
Golden Gate Bridge, Highway and Transportation District
Merin Municipal Water District
Metropolitan Transportation District
San Diego Housing Commission
University of California
Clark County, Washington
Clallam County, Washington
Pierce County
Seattle Schools District
City of Aberdeen
City of Scottsdale
City of Tempe
Operations and Cost Management
In addition to our extensive e-perience in government
consulting, Deloitte Haskins & Sells provides a full range of
services in the Operations planning, audit, and cost
management area. These services include:
Conducting reviews of departmental operations and key
functional areas, including purchasing, storage, and
distribution
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Designing and installing systems for:
®
.. Forecasting
.. Master Scheduling
.. Materials Requirements Planning
.. Inventory Control
.. Order Entry and Control
.. Purchasing
Q
.. Bills of Material
.. Production Planning and Scheduling
.. Capacity Planning
.. Shop Floor Control
.. Physical Distribution
Warehousing
®
.. Budgeting
.. Cost Accounting
.. Responsibility Reporting
Analyzing work methods and procedures
Defining information requirements, selecting computer
software and hardware, and monitoring installation of
EDP systems
Applying analytical techniques to optimize operational
efficiency
Designing and conducting training programs on operations
management
In the San Diego, San Francisco, and Los Angeles offices, we
have staff dedicated to operations management, including
®
purchasing, inventory control and warehousing. Some of the
clients we have served specifically in the area of
procurement and inventory control are shown below. We have
also indicated references for some of our clients.
Long Beach Public Transportation Company - 3/84 - 8/84
We are currently engaged to assist in the development of
a Procurement Policies, Standards, and Procedures Manual
which:
.. Sets out, in one document, the procurement policies
and standards of the Long Beach Public
Transportation Company. This includes policies
which promote affirmative action in contracting and
purchasing.
.. Provides sufficient g idance and cross-references to
facilitate compliance with federal procurement
®
policies and regulations.
.. Provides step-by-step procedures to Long Beach
Transit personnel for the proper and efficient
execution of procurements for materials and outside
services.
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.. Enables Long Beach Transit to receive federal
certification of the Company's third -party
contracting process.
Reference:
Mr. Patrick Butters
Assistant General Manager
Long Beach Public Transportation Corporation
PO Box 731
Long Beach, California 90801
Telephone Number: (213) 591-8753
Alameda -Contra Costa County Transit District
We are currently assisting the District in implementing
an integrated purchasing, vehicle maintenance, and
inventory management system to be utilized in
conjunction with AC Transit's new Central Maintenance
Facility. The integrated system includes the following
modules:
.. Purchasing and Receiving
.. Vehicle Maintenance
.. Materials Management
.. Fixed Asset Management
The system will utilize state-of-the-art hardware and
software, including portable optical scan technology for
each of the four systems.
Reference:
Mr. Nathaniel A. Gage
Assistant General Manager for Finance
Alameda -Contra Costa County Transit District
508 16th Street
Oakland, California 94612
40 Telephone Number: (415) 891-4891
Metropolitan Transportation Commission - San Mateo
County Transit District
We are engaged in a performance audit of the San Mateo
County Transit District for the Metropolitan
Transportation Commission. As part of our detailed
audit of specific functional areas, we are:
.. Evaluating and documenting purchasing goals and
objectives
.. Analyzing purchasing policies and procedures
.. Making recommendations for improvement.
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Reference:
Ms. Theresa Watkins
Metropolitan Transportation Commission
San Mateo County Transit District
Metro Center
101 8th Street
Oakland, California 94607
® Telephone Number: (415) 464-7752
City and County of San Francisco
We are performing a Capital Asset Management System
Needs Analysis for the City and County of San Francisco
which includes a review of the City's Purchasing
Department and procedures. CAMS is a comprehensive
system for City-wide management of San Francisco's
capital assets on a life -cycle basis. It entails
policies, procedures, automated capabilities, and
management programs for capturing, maintaining,
accessing, and reporting information and asset location,
condition, cost history, funding sources, and other data.
Reference:
Financial Systems Manager
Comptroller's Office
City and County of San Francisco
City Hall
Room 168
Mezzanine
San Francisco, California 94102
Telephone Number: (415) 558-2792
County of Los Angeles - Purchasing and Stores Department
We conducted a detailed management audit of the Stores
Division of the Purchasing and Stores Department.
Purpose of the audit, was to determine inefficiencies and
where cost effective improvements can be made. The
analysis included receiving, inspecting, storage,
picking/delivery, and inventory management. A general
overview of purchasing was also conducted to determine
purchasing/stores interfaces.
Reference:
Mr. Thomas Torske
Chief Deputy Purchasing Agent
Purchasing and Stores Department
County of Los Angeles
2500 So. Garfield Avenue
PO Box 22259
City of Commerce, California 90040
Telephone Number: (213) 728-1311, Ext. 203
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University of Nevada
We designed a state-of-the-art integrated management
information system for this multi -campus university.
The system included all financial and management
components, including purchasing.. The initial phase of
this project included a requirements analysis of the
purchasing operation.
® California State University
We prepared a feasibility study report for an integrated
business system, including purchasing, financial
management reporting, budget preparation, accounts
payable, accounts receivable, and payroll.
State of Utah, Division of Finance
We prepared a conceptual design for a statewide
financial and management system which included
purchasing, budget, payroll/personnel, accounts payable,
inventory, fixed assets, and accounts receivable.
Hughes Helicopter
We reviewed the Procurement System within the Materials
Division to determine if:
.. Purchase order processing time could be reduced
Proper controls were being maintained
.. Document traceability exists in the system
.. Procurement's automated support systems are being
used in an effective and efficient manner
G
Mr. Larry Bernardin
Assistant Controller, Cost Management
Hughes Helicopter
Culver City, California
Telephone Number: (213) 305-5000
South Bay Union School District
(Analysis of alternatives, selection and implementation
of telephone system, on -going - 1984).
Mr. Joseph Nolan
Assistant Superintendent of Business
South Bay Union School District
601 Elm Avenue
Imperial Beach, California 92032.
ts Telephone Number: (619) 423-4555
- 51 -
CONSULTANT AGREEMENT BETWEEN THE CITY OF HUNTINGTON BEACH
AND DELOITTE, HASKINS AND SELLS FOR ASSESSMENT
OF PURCHASING CENTRAL SERVICES
THIS AGREEMENT, made and entered into this 18th day of March, 1985, by and
between the CITY OF HUNTINGTON BEACH, a municipal corporation of the State of
California, hereinafter referred to as "CITY", and DELOITTE, HASKINS AND SELLS, a
general partnership authorized to do business in California, hereinafter referred to as
"CONSULTANT".
WHEREAS, CITY desires to engage the services of a management consultant to
prepare a study to analyze the City Purchasing/Central Services operations, plan; and
CONSULTANT has been selected to perform said services,
NOW, TfiFREFORE, it is agreed by CITY and CONSULTANT as follows:
1. PURPOSE
CITY hereby contracts with CONSULTANT to provide assistar..ce to CITY in
addressing specific questions as set forth in Exhibit "A" which is dated January 15, 1985
and entitled, "A Proposal for Purchasing Assessment Study for the City of
Huntington Beach" hereinafter referred to as Exhibit "A" and incorporated herein by
reference.
2. SCOPE OF WORK
CONSULTANT will provide the services to be rendered as set forth in
Exhibit "A", workplan for addressing specific issues related to purchasing, reproduction,
mail distribution, telecommunication, office supply inventory and salvage. The City's
objectives include the following criteria of the contractor:
.Identify the current operation of the Purchasing/Central Service Division.
.Review end assess the Division's staffing requirements.
.Determine current level of performance and problem areas for the Division.
.Review and assess the Division's contract procedures.
.Review and assess the warehousing procedures.
.Determine the responsiveness of the current operation.
.Design a conceptual Management Information Systems.
3. COST, FEE, AND PRICE
CITY agrees to pay CONSULTANT consideration for its services as described
herein. The maximum price, to be paid by CITY to CONSULTANT, shall not exceed
Twenty Thousand Five Hundred Dollars ($20,500).
AOL
4, TIME PERIOD
The term of this Agreement shall be for nine (9) weeks. CONSULTANT shall
complete and submit all work products to CITY in accordance with tine schedule set forth
in Exhibit "A".
5, INVOICES
CONSULTANT shall submit monthly invoices in duplicate to CITY.
CONSULTANT shall be compensated for the services of those personnel employed as
required in the performance of the Agreement on the basis of standard billing rates of
said personnel for the time such personnel are utilized in connection with the work
necessary to fulfill the terms of this Agreement. A schedule of costs shall be included in
Exhibit "A1l to this Agreement. Copies of receipts, bills, etc., for all individual cost items
in excess of Two Hundred Fifty Dollars ($250) shall be attached to the invoice.
6. PAYMENT
All payments by CITY shall be made in arrears, afte- the service has been
provided. CITY shall pay on a monthly basis in accordance with the work on the project
actually completed, as certified and billed by the CONSULTANT in his monthly invoice.
Payments for services performed directly by CONSULTANT shall be by voucher or check
payable to and mailed first class to:
Deloitte, Haskins and Sells
701 "B" Street, Suite 1900
San Diego, California 92101
7, TRANSFER OF TITLE TO EQUIPMENT
Equipment and supplies purchased by CONSULTANT as a direct -charge item in
connection with the performance of this Agreement shall become the property of the
CITY upon payment of invoice for that -equipment and supplies submitted by
CONSULTANT,
8, INSPECTION*
CONSULTANT shall peYmit the authorized representatives of the CITY to
inspect and audit all data and records of the CONSULTANT relating to performance under
this Agreement for a period of three (3) years following final payment for services
rendered.
9. TERMINATION
If, through any cause within its control, CONSULTANT shall fail to fulfill, in a
timely and proper manner, its obligatiors under this Agreement, or if CONSULTANT
violates any of the terms or stipulations of this Agreement, CITY will notify
CONSULTANT in writing of the deficiency. If deficiency is not removed within two (2)
weeks, CITY shah thereu( )n have the right to terminate this Agreement by giving written
notice to CONSULTANT of such termination and to specify the effective date thereof, at
0182J/Pe.-2-
.rr
least five (5) days before the effective date of such termination. In that event;, copies of
all finished or unfinished documents, reports, and other materials prepared by
CONSULTANT under this Agreement shall, at the option of CITY, be made available to
the CITY, and CONSULTANT shall be entitled to receive compensation for all appropriate
labor and materials costs incurred prior to termination date.
Notwithstanding, the above CONSULTANT shall not be relieved of liability to
CITY for damages stiitained by CITY by virtue of any breach of Agreement by
CONSULTANT, and CITY may witnhold any payments to CONSULTANT for the purpose
of set off until such time as the exact amount of damage due to the CITY from
CONSULTANT is determined. The maximum amount of any such damages shall not
exceed the total amount of this Agreement.
The CITY shall be liable for all costs and a prorate of the fixed fee incurred prior
to the stopwork period and for restart. CONSULTANT shall make all reasonable efforts
to minimize costs to the CITY.
CONSULTANT has the same rights of termination ks CITY.
10. CHANGES
In the event CITY orders changes froin the list of work shown in Exhibit "A", or
for other causes orders additional CONSULTANT work not contemplated hereunder,
additional compensation shall be allowed for such extra work. CITY shall promptly notify
CONSULTANT in writing by change order of all changes in scope. Change orders shall
a
specify a cost limit. All change orders shall be mutually agreed to by both CITY and
CONSULTANT.
11. INFORMATION AND DOCUMENTS
All information, data, reports, records, charts, survey results as are existing
and available for carrying out the work as outlined in Exhibit "A", hereof, shall be
furnished to CONSULTANT without charge by CITY, and CITY shall cooperate in every
way possible in the carrying out of the work without undue delay. All reports, manuals,
etc., produced by CONSULTANT relating to the project shall be owned by CITY.
CONSULTANT may retain and use internal copies of all working papers and project
products.
12. MANAGEMENT
r:
During the term of this Agreement, CONSULTANT shall provide sufficient a'
executive and administrative personnel as shall be necessary and required to perform its
duties and obligations under the terms hereof. Mr. Frank Panarisi shall be in direct
charge of the project and shall supervise and direct the project. Any change in the
management of this Agreement by Mr. Panarisi shall be approved by the CITY in writing.
. �a- ��m,..,:�k... „.�,.Y�.w,. . _.� ,.,,�,•. .:v.. .:yam
i
13. MATERIALS RETAINED
CONSULTANT shall retain project -related materials and worksheets for a
minimum of three (3) years after the delivery of the final. product. Said materials and
reports shall be available on request to the CITY.
14. KEY PERSONNEL
Key personnel ide `ified as the project team shall be assigned to this work and
shall not be replaced by any other persons without the written approval of the CITY.
15. INDEMNIFICATION, DEFENSE, HOLD HARMLESS
CONSULTANT hereby agrees to defend, indemnify and hold narmless CITY, '_ts
officers, agents and employees, from and against any and all liability, damages, costs,
losses, claims and expenses, however caused, resulting directly or indirectly from or
connected with CONSULTANT's performance of this Agreement (including, but not
limited to such liability, costs, damage, loss, claim, or expense arising from the death or
injury to an agent or employee of CONSULTANT, subcontractor, if any, or of CITY or
damage to the property rf CONSULTANT, subcontractor, if any, or of CITY or of any
agent or employee of the CONSULTANT, subcontractor, if any, or of CITY), regardless of
the passive or active negligence of CITY, except where such liability, damages, costs,
losses, claims or expenses are caused by the sole negligence or willful misconduct of CITY
or any of its agents or employees including negligent omissions or commissions of CITY,
its agents or employees, in connection with the general. supervision or direction of the
work to be performed hereunder.
16. WORKERS' COMPENSATION
CONSULTANT shall comply with all of the provisions of the Workers'
Compensation Insurance and Safety Acts of the State of California, the applicable
prow ons 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, defend and
hold harmless CITY from and against all claims, demands, payments, suits, actions,
proceedings and judgments of evp*v nature and description, including attorney's fees and
costs presented, brought or rec-. gyred against CITY, 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
CONSULTANT under this Agreement.
17. INSURANCE
In addition to the Workers' Compensation Insurance and CONSULTANT's
covenant to indemnify CITY, CONSULTANT shall acquire and maintain in force, until the
completion of PROJECT and acceptance of all work by CITY, a policy of general liability
insurance in which CITY is named as an additional insured. Said policy shall indemnify
CITY, its officers and employees, while acting within the scope of their duties, against
any and all claims arising out of or in connection with PROJECT, and shall provide
coverage in not less than the following amounts: Combined single limit bodily injury or
0182J!Pg.-4
property damage of $300,000 per occurrence. Said policy of insurance shall specifically
provide that any other insurance coverage which may be applicable to the PROJECT shall
be deemed excess coverage and CONSULTANT's insurance shall be primary. A
certificate of insurance providing the current existence of si4id policy shall be delivered to
the City Attorney prior to the commencement of any work hereunder. All insurance and
evidence thereof shall be subject to approval by the City Attorney in writing. The
certificate of insurance and the policy of insurance or endorsements thereof shall provide
that any such policy shall not be cancelled or modified without thirty (30) days' prior
written notice to the CITY.
18. NON-DISCRIMINATION
In connection with the execution of this Agreement, CONSULTANT shall not
discriminate against any employee or applicant for employment because of race, religion,
color, sex, age, or national origin. CONSULTANT shall take affirmative action to insure
that applicants are employed, and that employees are treated during their en,rloymen.t
without regard to their race, religion, color, sex, age, or national origin. Such actions
shall include, but not be limited to, the following: employment, upgrading, demotion, or
transfer; recruitment or recruitment advertising; layoff or termination; rate of pay or
other forms of compensation, and selection for training, including apprenticeship.
19. SUBCONTRACTS
CONSULTANT shall not subcontract any portion of the work required by this
Agreement without prior written approval of CITY.
20. PROHIBITED INTEREST
No member, officer, or employee of the CITY during his/her tenure or one year
thereafter, shall have any interest, direct or indirect, in this Agreement or the proceeds
thereof.
21. NOTICES
All notices hereunder and communications with respect to this Agreement shall
be effective upon the mailing thereof by registered or certified mail, return receipt
requested, and postage paid to the persons named below:
TO CITY:
Mr. Robert Franz
Chief of Administrative Services
CITY OF HUNTINGTON BEACH
2000 Main Street
Huntington Beach, California 9264E
10 CONSULTANT:
Mr. Mark Delane
Director
DELOITTE, HASKINS AND SELLS
701 "B" Street, Suite 1900
San Diego, California 92101
22. SUCCESSION
This Agreement shall be binding on and inure to the benefit of the heirs,
executors, administrators, and assigns of the parties hereto.
0182J/Pg.-6-
23. HEADINGS
The headings or titles to paragraphs of this Agreement are not part of the
Agreement and shall have no effect on the construction or interpretation of any part of
this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by and through their authorized officers the day, month and year first above
written.
CITY OF HUNTINGTO.N BEACH
A Municipal Corporation
ATTEST:
City Clerk
APPROVED AS TO FORM:
City At rney
INPI'IATED
REVIEW AND APPROVED:
,-----City Admin-19trator
DELOITTE, HASKINS AND SELLS
/ Mark Delane, Director
M
PRODUCER 1 w
Davis, Dorland & Co.
Two World Trade Center
New York, New York 10048
INSURED Deloitte Haskins & Sells
One World Tradc Center
New York, New York 10048
�x I ISSUE DATE (MM/DDNIO
Q.ffli-
_...--su 3/19/85
THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS
NO RIGHTS UPON THE CERTIFICATE HOLDER. T141S CERTIFICATE DOES NOT AMEND,
EXTEND OR ALTER THE CC IERAGE AFFORDED BY THE POLICIES BELOW.
COMPANIES AFFORDING COVERAGE
LETTER
ZURICH INSURANCE COMPANY
COMPANY
LETTER
COMPANY
i
LETTER
COMPANY
D
LETTER
COMPANY
LETTER
THIS IS TO CERTIFY THAT 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 ISSJED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCR!BCD HEREIN 1S SUBJECT TO ALL THE TERMS, EXCLUSIONS, AND CONDI-
TIONS OF SUCH POLICIES.
CO
TYPE OF INSURANCE
POLICY NUMBc"R
PnuCV EFFfCT!VE
POLCY EXPIRATON
LIABILITY LIMITS IN THOUSANDS
EACH
AGGREGATE
LTR
DA'F „RA;0VTY+1
Oil ;0.11A1TXYYy)
OCC:URREN E
GENERAL
x
LIABILITY
TOP 3251936-00
1/1/85
1/l/86
BODILY
INJURY
$
$
A
COMPREHENSIVE FORM
PROPERTY
_
PREMISES/OPERATIONS
UNDERGROUND
DAMAGE
$
$
EYPLOSIDN & COLLAPSE HAZARD
�-
BI& PD
COMBINED
$ 1,000,
$ 1,000,
PRODUCTS/COMPLETFD OPERATIONS
CONTRACTUAL
INDEPENDENT CONTRACTORS
BROAD FORM PROPERTY DAMAGE
�d
PERSONAL !NJURY
PERSONAL INJURY
$
AUTOMOBILE
LIABILITY
k11ar
$
ANY AUTO
to
PER�OSI
w
BOL"L.
ALL OWNED AUTOS (PRIV PASS)
\
ALL OWNED AUTOS (OTHER
OPRIV TH RPA�N)
$
a
t U
HIRED AUTOS
PROPERLY
DAMAGE
$
NON -OWNED AUTOS
s & PD
$
GARAGE LIABILITY
:: ` �•;
COMBINED
EXCESS LIABILITY
uMBRELLA FORM
Bi & Pa
COlABINEt $
$
OTHER THAN UMBRELLA FORM
1
STATUTORY �, • ;
WORKERS' COMPENSATION
$ lO�,(EACH ACCIDENT)
A
AND
WC 3251930-01
1/l/85
1/l/86
(DISEASE -POLICY LIMIT)
EMPLOYERSLIABILITY
$ (DISEASE • EACH EMPLOYEE)
OTHER
OE5GHIPIIUN OF UYtHANONS/LOCATIONS/VEHICLESl5PECIAL ITEMS
Coverage in effect with regard to work contract to study and analyze the City/Purchasing/
Central Service Division for tIe City of Huntington Beach, California and includes the
,•,t mcf- of I'ma rir.7 of Nnntinol-nn Raacb ,Inder liability as respects this contract.
j Robert Franz, Chief Of Admn. SerV1 C SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EX-
Mr.PIRATIfJ8I DATE THEREOF, THE ISSUING COM-ANY WILL IEWAVOqX=
CITY OF HUNTINGTON BEACH MAIL_ DAYS'NRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE
2000 Main Street RNMIRI_11
Huntington ]Beach, California 92646 AUTHORIZED R E `WATIVE
3 /19/85
j PRODUCER
INSURED
Davis, Dorland & Co.
Twj World Trade venter
New York, New York 10048
Deloitte Haskins & Sells
One World Trade Center
New York, New York 10048
THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS
NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS C,7RTIFICATE DOES NOT AMEND,
EXTEND OR ALTER THE COVERAGE AFFORDED BY 7, E POLICIES BELOW.
COMPANIES AFFORDING COVERAGE
LETTERNY ZURICH INSURANCE COMPANY
COMPANY
LETTER
COMPANY
LETTER C
COMPANY D
LETTER
COMPANY
LETTER
TEAS IS TO CERTIFY THAT POLICIES OF INSURANCE LISTED BELOW HAVE BEEN 6:,SUEDTO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED.
NCTWITHSTANDING ANY REUUIRE•MENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIC CERTIFICATE MAY
BE ISSUED OR MAY PERTAIN. THE INSURANCE AFFORDED BY THE POLICIES I'ESCRIDED HEREIN :S SUBJECT TC ALL THE TEHMS, EXCLUSIJNS, '. ` CONDI•
TICNS OF SUCH POLICIES.
IABILfTY LIMITS IN THGUSANDS
CO TYPE Or INSURANCE PC?L!C r NUMBED! ��� li C ` h �- --
UCCUPRENCE AGGREGATE
GENERA LIABILITY Boo
I TOP 3251936-00 111/85 111/86 4J.1Rt
I, dPREH;NSWE ! ORY
PII '1 E 'OP> RATIONS R jPE IT+
y,fER(R^UND j i JA1AGE !
EXPLOSION S COLLAPSE HAZARD
t------�—.� _.
PR )D(TTSiC;`APLETED OFERAT!O`+.: ' I
- R1' UAL �MNiNED
1,000,E ' 1,000,
i!NOEP,NDENT CONTRACTOR,
BREAD �CRM PROP'RiY DAMAGE !
PfR'.ONA: IN.IURY PERSONAL INJURY I
t II f
AUTOMOBILE LIABILITY !�^--
j AN, AUTO j ! j ,ggat ._----- ,4
r---� AL. OWNED AUTOS IPRI', PASS i
AL, OWNED AUTOS 1 THFRPTHAN1 � vCa1 ','r $PRIV 1
HIRED AUTOS / j PRO FRr�I-- ` C i
NON OWNED AUTOS DAMf:GE v� r
GARAGE :IARILITY
I Br R
! COMBINED
EXCESS LIABILITY
& PD
I UMBRELLA FORM COMBINED $
E I OTHER THAN UMBRELLA FORM
STATUTORY
WORKERS' COMPENSATION J $ 100 LEACH ACCIDENT)
A AND WC 3251930-�01 i t/l/85 1/1186 ;"; OISEASE,POLICY LIMIT)
EMPLOYERS' LIABILITY -----
(DISEASE EACH EMPLOY
OTHER
DESCRIPTION OF OPERATIONSILOCATIONSNEHICLESISPECWL ITEMS
Coverage in effect with regard to work contract to study and analyze the City Purchasing/
Central Service Division for the City of Huntington Beach, California and includes the
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EX -
Mr. Rwba>rt F`rauz, Chief of Admn. Servic PIRATION DATE THEREOF, THE ISSUING COMPANY WILL
CITY 0� � OIaI�iTOZ: BEACH MAIL_ 30__DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE
LEFT
2000 Main Street
Huntington Beach,, California 92648 AUTHORIZED REFIAEgeNTATIVE
Deloitte, Haskins & Sells
701 "B" Street, 71900
San Diego, CA 92101
Attn: Mark Delane
The City Council- of the City of Huntington Beach at its regular
meeting held Monday, March 18, 1985 approved an agreement with
your firm for assessment of purchasing/central services.
Enclosed is a duly executed copy of said agreement together
!with a copy of the Certificate of Insurance which you submitted.
i
Alicia M. Went:;arth
City Clerk
AMW CB:t
® `.
�jCITY OF HUNTINGPON
4 , 2000 MAIN STREET CAUFOR NIA 926-18
OFFICE OF THE CITY CLERK
March 21, 1985
Deloitte, Haskins & Sells
701 "S Street, #1900
San. Diego, CA 92.101
Attn: Mark Delane
The City Council of the City of Huntington Beach at its regular
meeting held Monday., March 18, 1985 approved an agreement with
your firm for asses.;ment of purchasing/central services.
When your Certificate of Insurance has been submitted to the City
and approved by the Office of the City Attorney, the contract will
be _executed by the City and a copy will be provided to you.
Alicia M. Wentworth
City Clerk
AMW: b t x
Enclosure
CC: Robert Franz Finance Department
Ruck Amadril - Purchasing Manager
(f e18Pha v! 714-53"227)
K
REQUEA FOR CITY COUNCAPACTION
Date March 8, 19 co
Submitted to: Honorable Mayor and City Council v'4
Submitted by: Charles W. Thompson, City Administrato
Prepared by: Robert J. Franz, Chief of Administrative Service
Subject: Purchasing Assessment ComAact.
Consistent with Council Policy? b"I Yes [ ] New Policy or Exception
Statement of Issue, Recommendation, Analysis, Funding Source, Alternative Actions, Attachments; A � —
Statement of Issue: The Administrative Services Department desires to conduct an Pssessmelif of the
City's purchasing operation, utilizing outside professional assistance to evaluate current operations
and develop recommendations for improvement.
Recommendation: Approve the attached contract w.,n Deloitte Haskins, Q Sills for the dwielopment
of a Purchasing 'Assessment Program.
Analysis:. The City's Purchasing operation was wider the direction of the same Purchasing Agent for
a 17 year period of rapid growth in city operations. The purchasing operation has remained somewhat
the same in terms of basic approach to providing service to departments. The ^_urrent Purchasing
Manager has been responsible for this operation, for over 2 1/2 years during which time a number of
improvements have been implemented. Rece•it appointments to vacant positions have brought the
division to full strength (10 employees including Print Shop and Mail operations) for the first time in 2
I/2 years. Staff feels the timing is excellent for an outside assessment of our operations so that
further improvements can be made in this important area.
There are two primary reasons an outside contractor or consultant is recommended for this project
instead of completing the project with city staff. The first reason is the expertise and independent
review that an outside firm would bring to the project. It would be difficult for city staff to acquire
the level of expertise required for this assignment, within a reasonable time frame. The second and
perhaps equally important. reason is the ability of an outside firm to perform an in-depth assessment
in a relatively short amount of time (8 weeks). The recommended contractor estimates about. 350
hours of work for this project. It would not be possible to allocate this number of hours of city staff
time to this project over an 8 week time period without negatively impacting day -today operations
and services. It would be difficult to complete this project within 6--8 months if the project were
completed with. city staff. Staff feels that this timing consideration, along with the expertise and
independence of an outside consultant, justifies the hiring of the recommended firm. Tile total
project cost of-$20,500 is a relatively minor cost when compared to the potential savings that the
purchasing, operation can generate.
The ,data and statistics provided below are an indication of the scope and complexity of the.
Purchasing/Central Services operation, and provides some indication of the type of savings that can
occur when this „ -:ration is managed in the most efficient manner possible. This program will
review the following areas: Purchasing, Print Shop, Mail Distribution, Telecommunication, Office
Supply Inventory, and Salvage operations.
The Purchasing Division has an annual budget of about $+680,000 and is responsible for the processing
of over 5,000 Material Requisitions per year with a: dollar volume of approximately $15,000,000 in
purchases. The Print Shy' averages 550,000 duplications per month along with over -seeing 22 copiers
at various city locations; The City°s Mail operation- runs postage for Water Billing! at a postage cost,
of $48,000 per year, Business License at $8 000 per year, and regular city mail at $45,000 per year.
The City currently leases a ROLM CBX telephone system with 540 lines and 104 trunks. Over 40,040
outgoing calls per month are placed with an average cf $4,300 per month of long distance charges,
rio Elsa
HONORABLE MAYOR AND R EST FOR COUNCIL ACTION
CITY COUNCIL MEtdBERs PURCHA G ASSESSMENT CO,4TRACT
s
Purchasing also maintains an office supplies inventory of approximately $14,000 and distributes
approximately $30,000 of supplies to th�> various departments per year. :Salvage operation for the'
City of Huntington Beach is the method by which departments dispose of all surplus equipment
and supplies. This operation generates approximately $30,000 per year of revenue to thc: City.
26 firms were requested to submit letters of interest in this project. Eight firms expressed
interest of which five met our minimum qualifications to submit proposals. One firm decided
against submitting a proposal.
The four proposals received were as follows:
PROJECT COMPLETION
FIRM COST STAFF SCHi:DULE
Ralph Anderson $1 J, 070 2 12 weeks
Deloitte Haskins & Sells 20,500 3 8 weeks
Main Nuidmo� 24,800 4 10 weeks
Peat Marwick 28,000 7 8 weeks
After reviewing the four proposals, it is staff recommendation to contract with Deloitte, Haskins
and Sells. Their proposal meets the City's needs and objectives better than the other firms.
Deloitte, Haskins and Sells has put together an assessment team with varied and extensive
experience and expertise. The project staff that this "Big 8" accounting firm would assign to this
project has broader City and County experience than the other firms in terms of the day -today
management of a purchasing operation. Deloitte, Haskins and Sells also has technical expertise on
their staff in certain areas such as telecommunications that could prove to be of great assistance
to the City even though a relatively small amount of the total project hours would be allocated to
those technical areas. Lastly, the recommended contractor would complete this project in the
shortest amount of time which is a further benefit to the City in our planning and implementation
proc,ass. { .
Funding Account 176390.
Alternative Action:
i,
1. Select another firin from those who submitted proposals.
2. Do riot approve hiring of consultant for the project and ask staff to conduct y
in-house analysis of similar scope. r
Attachments;
1. Exhibit "A" Proposal for Pttrehasing Assessment Study,
2. Contract with Deloitte Haskins & Sells.
-f
n
Table of Contents
Propo8al for
Purchasing Assessment Study
City of Huntington Beach
Pais
L.
Transmittal Letter
1
II.
Introduction
4
Overview: Government and Purchasing
5
Understanding of City's Needs
5
III.
Work Plan/Schedule
7
®
IV.
Costs
18
V.
Project Management
19
V1.
Staffing
77
Organizational Chart
30
Resumes
31
VII.
References
45
s
r
`t
lid
a
0
1. TRANSMITTAL LETTER
E
0
Eli
Mr. Richard Amadril
Purchasing/Central Services Manager
PO Box 190
2000 Main Street
Huntington Beach, California 92648
Dear Mr. Amadril:
Suite 1900
701 " 8 Street
San Diego, California 92101-8198
(619) 232-6500
TWX 910-335-1573
January 15, 1984
Deloitte Haskins & Sells is pleased to submit our proposal to
conduct a purchasing ossessment study of the Purchasing/
Central Service Division for the City of Huntington Beach.
We understand your primary interest is to assure the city's
limited purchasing dollars are most effectively spent.
Further, the city s purchasing policies, procedures and
organization structure should promote the procurement of
quality goods and services. Our review can help insure those
objectives are met.
For several reasons, we believe we are uniquely qualified to
assist the City of Huntington Beach i�n this study:
Relevant Experience: We have performed management audit
engagements for various public sector organizations and
have extensive experience in the review of purchasing
operations in private industry and the public sector.
In particular we have recently completed similar work in
a management audit of the Purchasing and Stores
Department of Los Angeles County. Some of our
government clients include the County of San Diego, San
Diego Association of Governments, City of Carlsbad, City
of Orange, City of Irvine, San Bernardino County, City
of Chula Vista, and the City of Los Angeles.
Quantifiable Savi gs: Our experience iD similar
engagements shoes a three to 'rive fold return within the
first year, and a five to fifteen fold return over a
five year period. In our report we will quantify the
potential savings to the City based on implementing our.
recommendations.
2
Project Team: In order to conduct a purchasing
assessment study of your purchasing operation, you need
a variety of expertise. Our project team consists of
b
experts in purchasing policies and procedures,
organizational analysis and computer systems design.
In addition our consultants have been in government and
understand your unique problems.
Work Plan: To ensure consistent quality in our
projects, we have detailed a work plan which provides
documented deliverables and a review process at each
step throughout this project.
Firm ua�lifiications: We possess the extensive resources
of a "Big 8" accounting/consulting firm in. Southern
®
California. Our Southern Pacific Government Consulting
Practice is based in San Diego with local offices in
both Los Angeles and Orange County. Consequently, we
can provide you with locally based consulting expertise.
Timing and Fees: We can start this job almost
imediatel upon award, an provide a quality product
forU,500. We have based our proposal on an intensive
examination of your operation. We are willing to
undertake our review at a less intense effort if it more
closely parallels your needs. We would be willing to
adjust our effort and fees, if you sr, desire.
We look forward to this opportunity to assist `he City of
Huntington Beach. Should you have any questions concerning
our proposal, please feel free to contact either Mr. Frank
Panarisi or Mr. Mike McNamara at (619) 232-6500.
Sincerely,
&elane
Mark
Director
Management Advisory Services
II. INTRODUCTION
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II. INTRODUCTION
Overview: Puchasing and Government
Materials management, including purchasing, is more
complex in government than in industry because of the
need to operate within a prescribed framework of laws,
to reveal pricing information and to use an open bidding
system. At the same time, because of the significant
impact purchasing has on the delivery of services to
citizens, it is critical that purchasing be operated in
a cost-effective manner. Productivity in purchasing
influences a large portion of a government's material
expenditure, the quality of goods and their timely
availability to users. In the City of Huntington Beach,
for example, approximately 15 million dollars of the
General Fund budget is spent by the Purchasing
Department for the purchase of materials and supplies.
Productivity in Government Purchasing should be measured
®
in terms of attainment of the following goals:
1) Obtain the optimum value for the purchasing dollar
expended
2 Coordinate the purchasing and materials management
activities in such a manner as to preserve the
integrity and honesty of operation
3) Supply needed materials, supplies and equipment in a
timely manner
4) Maintain fair and equitable relationships with
vendors.
5) Minimize the total cost of purchasing operations
6) Ensure maximum economic utilization of items on hand
®
prior to initiating purchasing
Our Understanding of Your Needs
In order to understand the major issues involved in the
proposed purchasing assessment program study, we have
reviewed the Request for Proposal and held discussions
with City staff.
Based on this information, the City's objectives include
the .following deliverables from the contractor:
Identify the current operation of the
Purchasing/Central Service Division.
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WC L- G L W X LI G %+ W L L C L I I- 1= V= L W l FJ I- = L L L FI L V U- U X
areas for the Division,
Review and assess tY_ Division's contract procedures.
Review and assess the Division's warehousing
procedures.
Determine the responsiveness of the current
operation.
Design a conceptual Management Information System.
The work plan proposed in the following section will
investigate the issues listed above and make recommendations
for improvement. dnere possible we will quantify the costs
and benefits associated with our recommendations.
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III. WORK PLAN/SCHEDULE
Our work plan includes four major tasks which are listed
0
below. We have also indicated the start and completion
date for each major task. We assume completion of the
project within a 50 day time frame. These estimates are
based upon an assumed start date of February 4, 1985.
They would be adjusted based upon our actual contract
approval and start date. Each task is discussed in
detail on the following pages.
Task 1: Organize Project
Task 2: Review Current Purchasing/Central Service
Division Program
Task 3: Review Purchasing/Central Service Division
Information System
Task 4: Prepare Final Report
Task 1: Organize Project - Stara 2/4/85 Complete 2i4/85
1.1 Meet with City staff
Our staff will meet with the Chief of
Administrative Services, Director of Finance,
49
Purchasing/Central Service Manager and other
appropriate city staff, who will administer and
supervise the contract, to discuss the work plan,
schedule roles and deliverables, including the
number of status reports required.
r
1.2 Finalize work plan x
We will detail all work plans, finalize
administration and reporting, and review schedules
for our project staff.
Task 2: Review Current Purchasing/Central Service
Division Program - Start 273785 Complete /85
t�
2.1 Review existing administrative and legal
documentation t
All existing documentation on the �A
Purchasing/Central Service Division will be
collected and revievied, including:
City Charter and Municipal Ccde Requirements
and other legal requirements
Administrative regulations., policies and
procedures
-: 8 - R
i
Organization chart(s)
Record keeping p;ocedur,es/forms
Training procedures/requirements
The above documentation will be reviewed for an
understanding of the current system's
administrative and legal requirements. In
addition, any major deficiencies in existing
policies or procedures will be noted.
While the Purehasing/central. Service Division will
be the primary focus, any documentation regarding
interfaces with other City departments will be
reviewed.
The current organizational chart and job
descriptions will be reviewed for understanding of
the current personnel staffing levels,
responsibilities and reporting relationships.
2.2 Interview City personnel
We will interview Purchasing/Central Service
Division and other key City personnel to further
the documentation of purchasing operations. In
addition to Purchasing/Centra.l Service Division
representatives, representatives of the
Administrative Service's Office, Finance
Department and Data Processing Department will be
interviewed.
The interviews will be conducted using the
structured interview questionnaire developed by
our Firm for reviewing purchasing operations.
However, the questionnaires would be modified to
meet the needs of the City's Purchasing/Central
Service Division.
The following purchasing functions will be
reviewed during the interviews:
Market review and analyses
Requisitioning
Preparation of specifications
Bidding, vendor evaluation and selection
Negotiation of purchases
9 -;
Contract_ monitoring
Order follow-up
Qua'►.ity control/testing
Accounts Payable interface
Telecommunications
Salvage operation
Warehouse effectiveness
Long term contracts
negotiation/award/monitoring (e.g. blanket
purchase oroers)
Purchasing audit trails
40
Voucher audit procedures
The interviews will document the actual practices
and procedures now used by the Purchasing/Central
Service Division, the role and training of the
respondent, and relationships with user
departments and accounting. Records and forms
used for the above functions will also be t.
collected and reviewed.
Analysis of the above documentation will focus on
the extent to which purchasing provides an
adequate level of service at an acceptable cost.
2.3 Survey user department representatives
Using a structured questionnaire, we will survey a
sample of user department representatives. The
sample of user departments will be based on the
following criteria: budget for supplies and
materials and equipment, numberof requisitions
processed, and the dollar value of purchases
r
The survey will assess purchasing performance L
impact on operations and major problems. Some of
these issues might include:
timeliness (processing of requisitions,
purchase orders and delivery of goods) U
communications N
price of goods received_
10 - �.
quality of goods recei)
back orders
administrative "red tal
negative dollar value on a department will be
quantified
2.4 Survey vendors
A questionnaire will be developed for surveying a
sample of vendors. The sample will be developed
from mailing lists of potential vendors, lists of
vendors who have actually bid in the recent past
and lists of vendors who have actually done
business with the City in the recent past.
While the sample will represent a variety of
vendors, a jignificant number of construction
contractors will be contacted to ensure an
adequate response regarding construction contract
procedures.
The vendors will be asked to assess the City's
t' .
contract procedures in terms of:
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bid specifications
selection criteria
selection procedures
adequacy of purchase orders
knowledge of and cooperation of purchasing
staff
clarity of purchasing policies and procedures
a
timeliness of payment
contract monitoring
change orders
2.5 Analyze Purchasing/Central Service Division
Performance Indicator Data
Based on the availability of data, we will assess
the performance of the purchasing system using
l 1.
various quantitative measures. These measures
when used with interview and survey information,
may indicate problem areas. Related to system
efficiency and effectiveness, these measures
evaluate timeliness, quality of service, savings
and price and impact on users of purchasing
activities. A sample of some of the measures
which maw be used are shown below:
Average time to process and purchase from
origin of initial written department
requisition to the issuance of the purchase
order.
Average time to process from receipt of
departmental requisition to issuance of award.
Average time to process request for a contract
item.
Number of stockouts compared to the number of
requests for stocked items from the
warehouse(s) .
Value of purchase order requirements contracts
compared to the value of purchases through
central purchasing. s
Operating costs of central ;purchasing
department compared to the value of purchases
through central purchasing.
Total operating cost for purchasing management
compared to the value of purchases through
central purchasing.
Operating cost for buyer compared to the value
of purchases through central purchasing.
Total operating cost for clerical support
compared to value of purchases through central
purchasing.
Average time to process an urgent requisition.
4
Line items processed to bid plus line items
awarded compared to person -hours.
Average age of requisitions held by buyers.
Number of shipments rejected for quality x
compared to the slumber of shipments.
Number of line items not shipped compared to £:
the number of line items ordered.
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Number of contracts with cost
overruns/underruns compared to total number of
contracts let.
2.6 DELIVERABLES
Measurement of the key indicators of current level
of performance for the Purchasing/Central Service
Division Operation to be used in analyzing the
current effectiveness of the program.
Task 3: Review Purchasing/Central Service Division
Information System - Stara 2 2tl 85 Complete 3/4/85
3.1 Review current record keeping and information flow
The Purchasing/Central Service Division manual and
automated information systems will be reviewed to
determine the adequacy and accuracy of the data
base, ease of accessibility, and the capability to
easily generate management information required
for.
Accountability and control of purchasing
activities
Measurement of purchasing performance (from
the point of view of the Purchasing Agent,
Chief of Administrative Services, Finance
Director, and other City members)
F.
Audit trails
Operations support
Contract monitoring
{
In order to evaluate vendor performance and follow
up on problems, the purchasing/Central Service
Division must receive adequate and timely feedback
from other areas. DH&S will: evaluate 'how the
information system interfaces with other areas and
specifically determine how:
Receiving discrepancies such as damaged or
incorrect material, wro,sg quantities and/or
delivery dates, and lack of proper open
purchase order, documentation are reported to
purchasing by the receiving function,
'3
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Quality discrepancies, including the frequency
of failure in receiving inspection and
problems experienced by user departments are
reported to purchasing by quality control.
Invoice discrepancies, such as incorrect
pricing or payment terms are reported by the
accounts payable function.
Vendor performance is measured over a
predetermined time period and analyzed for
trends rather than based on isolated reports
of good or poor pe-formance.
Deloitte Haskins & Sells recognizes that
achievement and maintenance of an effective and
efficient purchasing system requires that the
performance of the purchasing function be
monitored and measured. We will evaluate how the
information system is used to measure purchasing
performance in several areas:
Since vendor selection and evaluation is a
primary function of purchasing, DH&S will
evaluate how vendor performance is used to
measure purchasing performance.
DH&S will determine if management accounting
reports compare actual purchased material
costs to predetermined standards to measure
purchasing performance.
z
41
DH&S will determine if actual inventory levels
and dollarized receipts are used to measure
purchasing performance against budgeted
standards.
Finally, purchasing may be measured on its Z>
ability to achieve cost reduction objectives
through negotiation, value analysis and source
development. We will evaluate how the
information system is used to measure these
areas. y
Other examples of areas we will evaluate include,
but are not limited to, the:
Ability to provide status and tracking of
requisitions and open purchase orders.
Ability to provide messages to "take action"
or Leview exceptions" on material needs and
purchasing report.
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Ability to provide expediting messages for
materials scheduled for delivery beyond "need
date."
Ability to provide documentation,
administration, and reporting for Bid,/Quote
system before orders are placed and a vendor
is selected.
Ability to automatically generate purchase
orders once the requisition is approved.
Ability to generate:
a. blanket orders by time and by dollar
b, multiple release date crders
C. service contracts
d, multiple delivery site orders
Ability to provide history on blanket orders.
Ability to record vendor acknowledgements and
update purchase orders for price changes, date
changes, canceis, adds, etc.
Ability to monitor performance of contracts
against the RFP and subsequent purchase order.
Ability to track vendor performance for
on -time delivery, price increases, terms,
quality level, and overall performance.
Ability to provide purchase item history
including past vendors and substitute
materials.
Ability to calculatz: economic order quantities
(EOQ) and/or lowest cost decision.
Ability to provide receiving documents and
provisions for partial receipts, inspections,
and material disposition transactions.
Ability to provide documentation for materials
to be returned to vendors (i.e. rejected
goods, surplus, reworked materials).
Ability to provide work -files for developing
costs, generating requisitions, and planning
purchase orders.
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Ability to generate and maintain price
variance data (i.e. to target, to original
purchase order, to 'Last actual, to standard).
Ability to provide ABC analysis on purchased
items.
Ability to provide for manual adjustment
before generating the purchase order.
Ability to have multiple vendors and multiple
terms and prices for each item.
Ability to provide for subcontract order
tracking and control.
Ability to control and report on returnable
items such as containers, pallets, etc.
Our review
of the information system will also include
evaluating
the cost effectiveness of automating manual
procedures
and the efficiency of procedures currently
automated,
3.2 DELIVERABLES
A review of the current data processing/MIS
reporting systems and recommendations for
improvement and/or redesign.
Design of a performance reporting system that will
be used for long term management information.
Task-4.0
Prepare Final Report - Start 3/5/85 Complete 4/1/85
Based on our documentation and analysis of the City
purchasing
operations and the purchasing information system,
we will prepare a final comprehensive report which includes,
put is trot 11m ted to:
1. Overview of study methodology and oL, ive.
2. Overview of Purchasing/Central Service Division
operations and recommended changes.
3. Findings and recommendations regarding procurement
policies > and procedures, organization and staffing,
information system and performance measurement.. It is
our policy to provide cost estimates of major
recommendations wherever possible.
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4. Review of current operations and recommendations for
improvements of purchasing approaches to::
expediting and follow-up
contractual procedures
cost improvement and cost reduction program
warehousin
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responsiveness
5. Review and recommendations on improving your equipment
acquisition schedule for multi -department items such as
vehicles, typewriters, etc.
b. Review and recommendations regarding the City°s process
for paying vendors. This review would examine the use
of negotiated terms and the timing of the payments to
assure the best utilization of City funds.
7. Review and recommendations on the Purchasing/Central
Service Division Methodology of determining savings
obtained through centralized purchasing.
8. Recommendations to management on methods of monitoring
the effectiveness of purchasing in the future.
IV.Costs -
The following; identifies the labor hours and
an estimate of
the costs associated with each of the manor
tasks
of the work
plan:
Task
Hours
Cost
1. Organize Project
12
$ 900
2. Review current Purchasing/Central
Service Division Program
200
11„0:10
3. Review Purchasing/Central Service
Division Information System
42
2,100
4. Prepare Final Report
92
5,000'
Total
346
$19,000
In addition to labor costs we estimate our
out-of-pocket
expenses to be $1,500,
Total cost for the project will therefore
be:
Consulting Fee $19,000
Expenses �1,500
Total Fee $20,500
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V. Project Management
Proiect Supervision and Monitorin
Deloitte Haskins & Sells' approach to the management of
complex projects is to organize the work into a logical
sequence of related tasks of controllable size. Each task
has its own clearly identified functions and deadline. In
most cases, there is a final product which, when produced and
approved both by project_ and client management, indicates
that the task is complete. In this way, progress is clearly
measured and controlled throughout the life of the project.
Several project control tools are used to report progress to
project management at frequent intervals. This project
management and control approach has proven successful in all
of our recent engagements. Copies of our project control
forms are included at the end of this section.
Exhibit A
The Work Plan and Time Estimate form breaks down the Task
WorkStepsand details the estimated hours for each. Columns
are provided for time frames and for separation of the work
by several individuals. This plan summary is the basic tool
for subsequent project control. We will complete it to
outline the basic work plan for the project once we are
notified to proceed.
Exhibit E
0 The Actual Time Summarx tracks the actual time expended
against each element of the work plan by period and by staff
member. This is posted weekly.
Exhibit C
49 The Epo�gement Progress Report sets forth for each segment of
the cc,ial Work plan the budgeted man-hours, actual hours
expended to date, hours available to complete, current
estimates of the number of hours required to complete, and
expected number of hours this segment will be over or under
budget. This is prepared every four weeks.
Exhibit D
The Engagement Status Report normally submitted every four
weeks, summarizes the engagement as a whole, presenting the
engagement milestones just completed, and those to be
accomplished next, and, compares expenditures to date Witt)
those estimated.
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Exhibit E
The Daily Activity Rep�on�r is submitted every two weeks by
each consultant involved, and records, like a diary, the
activity of each person assigned to an engagement. Each
interested supervisory -level party may review this report and
keep informed as to the nature of the work completed during
the two -week period. Naturally, any problem areas would have
been reported promptly, not waiting for the end of the period.
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Engagement Milestone
Completion
Date
Met?
Yes
No
Current Period
Next Period
Scheduled
Dates
Current Period Charges
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Charged
Services
Expenses
Totals as Shown on EO Run of
Estimated Charges to Date
Estimate To Complete And Billing Status
Services
Expenses
Total
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Suggested Billing
To Date
Estimate
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Total at
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Quote/Estimate
Given Client
Percent of Std.
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Suggested Change
Dates of latest Discussions with Key Client Executives,
1, Are any fee problems anticipated?
2. Are scope or staffing requirements changing?
3. ;Are any other problems foreseen?
Yes
No
Prepared By: Date
Reviewed By: Dete
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EXHIBIT E
FORM MAS 30 12.78
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VI. STAFFING
We have assembled a project team with pertinent experience to
meet the requirements of this project. We have selected
experienced managers to provide proper project management and
coordination. The consultants we have chosen have specific
experience in ,government, management audits, purchasing, and
automated systems, in order to meet the demands of this
project.
Mr. Frank Panarisi will act as the Firm principal
responsible for the engagement. Mr. Panarisi, who has
twenty-seven years' experience in all aspects of public
administration, including purchasing, will provide
project supervision and review, in keeping with our
Firm's quality control objectives.
Mr. Michael McNamara, who has several. years` experience-
as Administrative Services and Finance Director for the
Cities of Irvine and San. Clemente, will act as Project
Manager for the engagement. He has had administrative
responsibility for purchasing and will ensure the proper
coordination and provide both technical and project
management assistance to ensure that the deliverables
proposed to the City of San Diego are completed in a
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timely and efficient manner.
Mr. William F. Klein, who has specific expertise in
assessment of purchasing procedures in the public
sector, will act in a technical advisory capacity on the
project. Most recently, Mr. Klein wrote a purchasing
procedures manual for the Long Beach Public
Transporation Company.
Ms. Joan Martin will serve as the primary consultant on
the project. Ms. Martins has fourteen years' consulting
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experience in the public and private sectors, and has
specific expertise in management audits and system
requirements analysis. Most recently Ms. Martin
conducted a management audit for the Los Angeles County
Department of Purchasing and Stores. Prior to joining
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Deloitte Haskins &. Sells, Ms. Marlin worked for Science
Applications, Inc. There she was responsible for
reviewing all corporate financial and management
systems:, including purchasing for this $300 million
annual revenue corporation.
Mr. John Neubauer, Manager with DH&S will also serve as
a technical advisor. fir. Neubauer has eighteen, years
experience in operations, manufacturing and systems for
both national and multi -national companies. He has had
extensive experience in planning, purchasing, inventory
control distribution, and systems development. Prior to
joining DH&S,>Mr. Neubauer was Manager of Management
Inf:cirm,aton Systems in Bausch & Lomb, Inc.
w 18-
In addition to the above primary staff, we have included the
resumes of consultants who may participate if additional
consultant assistance is required for this project. These
consultants include: Gwyn Hartman, Laurie Barrington,
Malcolm Carlaw and Mike Ford.
We would also propose that the City designate a review
committee to work with DH&S to refine our detail work plan,
identify appropriate interviewees and monitor our progress.
We would expect a time commitment of two or three meetings
Tasting one to two hours. We would expect to use the City
clerical staff for only scheduling meetings and interviews.
In addition to the above primary staff, we have included the
resumes of consultants who may participate if additional
S consultant assistance is requited for this project. These
consultants include: Owyn Hartman, Laurie Barrington,
Malcolm Carlaw and Mike Ford.
We would also propose that the City designate a review
committee to work with DH&S to refine our detail work plan,
identify appropriate interviewees and monitor our progress.
We would expect a time commitment of two or three meetings
lasting one to two hours. We would expect to use the City
clerical staff for only scheduling meetings and interviews
fill
The following Organization Chart outlines
the roles,
reporting relationships of the project team,
and estimated
percentage of total project time each individual.
will devote
to the project. Resumes for each of our
project members
i
follow the organization chart.
City Coordi.nator's:
- Chief of Administrative
Services
- Director of Finance
- Purchasing/Central
Service Manager
y Review
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mmittee
DH&S Project
Technical Advisor's
Director
William Klein &
Frank Panarisi
John Neubauer
Project Manager
Michael McNamara
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Consultant
Consultant
Consultants
Gwyn Hartman
Joan Martin
as needed
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-Laurie Barrington
-Michael fiord
-Malcolm Carlow
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21
FRANK PANARISI
Project Manager
Mr. Panarisi joined Deloitte Haskins & Sells in
March 1983 after twenty-seven years as a public
administrator. His public service included
fifteen years with the County of Los Angeles and
twelve years with the County of San Diego. Mr.
Panarisi has held a unique variety of executive
positions which have spanned the full range of
county services. He has the direct experience
of coping with the many challenges faced by
local governments.
Mr. Panarisi provides his knowledge of Local
government and the important part it plays in
the community. His background includes
experience as Assistant Chief Administrative
Officer, San Diego County, with direct
responsibility for all appointed departments
including: Purchasing, Health Services,
Probation, Defender Services„ Social Services,
EDP, Public Works, Planning, Animal Control,
Parks, Public Administrator, Revenue and
Recovery, Registrar, Coroner, General Services
Library, and Housing and Air Pollution Control.
Also, he had coordination responsibility for the
Sheriff, District Attorney, Superior and
Municipal Courts, and all other elected
departments.
He directed the centralization of a contracting
process in the Purchasing Department foi 'San
Diego County, and directed purchasing for a
major Los Angeles County hospital.
Among the many positions he has held are
President of County Health Care. Administrator's
Association of California, Assistant Chief
Probation Officer for Los .Angeles County,
Assistant Executive Officer of the Board of
Supervisors in Los Angeles County, Chairman of
the San Diego County Data Processing Policy
Committee, President and Board member of the San
Diego Criminal Justice Planning Board, and
Chairman of the San Diego County Audit Committee.
Since joining Deloitte Haskins &. Sells, Mr.
Panarisi assumed the role of our Firms
Coordinator of Southern California Consulting
Services to Public Sector clients.
FRANK FANARISI
He also served on various National Association
of Counties committees, the Policy Committee on
Administration of Justice for County Supervisors
Association of California, the President of the
County Health Administrators Association of
California.
For two years, he was a facilitator for the
National Leadership Institute - "Managing
Diminishing Fiscal Resources in Corrections".
Academic
Background:
Bachelors of Arts, Occidental College
Masters of Public Administration, California
State University, Los Angeles
Professional
Activities::
Mr. Panarisi is a member of:
California Municipal Treasurer's Association
Municipal Finance Officer's Association
San Diego Chamber of Commerce - Member,
Government
Advisory Council
San Diego Rotary
United Way - Board of Directors
Big Brothers of San Diego - President
R . MICHAEL McNAPIARA
Project Manager
Experience: Mr. McNamara is currently a manager with our
Government Consulting Practice in San Diego.
Prior to joining Deloitte Haskins & Sells, Mr.
McNamara served as the: Director of Administrative
Services for the City of Irvine, California for
four years. As Director, Mr. McNamara served as
the City's Finance Director, Personnel Director
and City Treasurer, responsible for planning,
organizing, and directing Gen-,ral Support Services
(Purchasing, Central Stores, Word Processing,
Duplicating and Records Management); Management
Services (Personnel, Budg—: Preparation/Research,
Risk Management, and Data Processing); and Finance
(Accounting, Business Permits, City Treasurer and
revenue collection activities).
From 1979 to 1980, Mr. McNamara served as Finance
Director for the City of San. Clemente, California,
and was responsible for the overall planning,
organizing, and directing of the City's financial
operations. This included responsibility for
preparation of a $13 million budget and management
of accounting, data processing, purchasing,
warehouse, utilities, including payroll, State and
Federal subventions and grants, and preparation of
the annual financial statement.
Mr. McNamara also served as Assistant to the Chief
Administrative Officer, County of San Diego.
Prior to Mr. McNamara's public management and
finance experience, he served as Financial and
Production Manager for Teledyne Systems Company in
Los Angeles, California, where he was Financials
Manager for a $15 million microelectronics
business, and responsible for planning,
implementation, and budget control of projects,
including the F-14 aircraft computer.
Mr. McNamara also served as an Intelligence
® Officer for the U.S. Army.
JOHN S . NEUBAUER
Technical Advisor
Experience: Mr. Neubauer is a Manager in our Los Angeles
Management Advisory Services Group. His
experience includes eighteen years in operations,
manufacturing, and systems in diverse product
companies, multi -national and domestic.
His experience has been in the review, selection,
installation, and implementation of complete
manufacturing and financial systems in job shop,
repetitive, r.nd process applications. As a line
manager, his responsibilities included designing
and maintaining effective product distribution,
cost savings programs, engineering charge systems,
inventory reduction systems, MRP implementation
planning, project management and sheep floor
control systems. Prior to joining Deloitte
Haskins & Sells, Mr. Neubauer was a line manager
over a diversity of lines of businesses in
production, operations, and corporate positions.
He was responsible for planning, inventory,
purchasing, distribution, warehousing, production
control, systems, data processing, and systems
development activities for Bausch & Lomb's Inc.,
European distribution.
Academic
Background M.B.A,, Finance & Economics, Pepperdine University
B.A., Languages, Rippon College (Wisconsin)
Diploma, Languages, University of Madrid (Spain)
Professional
Activities: Mr. Neubauer is a member of the National
Association of Purchasing Management, EDP Audit
Association, is certified in production and
inventory management of the American Production
and Inventory Control Society, and is a member of
the institute of Management Consultants.
WILLIA2" F. KLEIN
Technical Advisor
Experience: Mr. Klein, who has been with our firm for one
year, has more than seven years of professional
experience in strategic planning, financial and
operational analysis, operational and capital
planning, program management, and
intergovernmental relations.
Mr. Klein is currently participating in our
project to conduct a needs analysis as the first
phase of the City and County of San Francisco's
plan to develop a Citywide capital assets
management system. In this engagement he is
conducting the needs analysis for the City's
Purchasing Department. Additionally, he is
assisting the Long Beach Public Transportation
Company with the development of a procurement
policies, standards, and procedures manual. Mr.
®
Klein is also managing our organization, strategic
planning, and infrastructure study engagement with
the Ohio Department of Transportation. In
addition, he is assisting the Utah Transit
Authority with a strategic planning project.
Before joining our. firm, Mr. Klein was the Manager
of Intergovernmental Relations for the Regional
Transportation District of Denver. His
responsibilities included the direct supervision
of staff engaged in planning, programming, policy,
budgetary, and contract analysis; grants
administration, environmental impact assessment;
and minority busir,ess enterprise programs. Mr.
Klein's responsibilities also included
coordinating RTD's strategic planning and short
range transit development plan process.
Mr. Klein was also employed by the Orange County
Transit District as Program Administrator and
Analyst. As a member of the District's
development team, he was primarily responsible for
the administration of federal and state financing
for capital and special projects.
-36-
WILLIAM F. KLEIN
Academic
Background: BA degree, Unive- ity of California, Santa
Barbara
MPA degree, California State University, Long Beach
MS degree in Systems Management, University of
Southern California.
irofessional
Activities: The Institute for Managerial Accounting
The American Society for Public Administration
(Sections on Public Finance and Intergovernmental
Relations)
37-
JOAN K. MARTIN
Consultant
Experience; Ms. Martin has fourteen years' experience in
consulting and program management for government
and private corporations. In the government area,
Ms. Martin has consulted with Federal and state
agencies, special districts, councils of
government, counties, and municipalities.
Specific responsibilities have included: market
and systems research; feasibility studies; program
evaluation; survey work; rational and
operations analysis; establishment of management
information systems; and endowment and grant
management.
Ms. Martin joined Deloitte Haskins & Sells as a
Senior Consultant, Management Advisory Services,
in 1984. Her major responsibility includes
consulting to local, governments in the areas of
information systems, strategic planning,
organizational analysis, program evaluation, and
feasibility studies. Ms. Martin's clients include
the County of San Diego, the City of Henderson,
the City of Los Angeles, and the County of Los
Angeles. Most recently, she completed a survey
and management audit for the County of Los Angeles
Purchasing and Stores Department.
Prior to joining DH&S, Ms. Martin was a Senior
Internal Consultant with Science Applications,
Inc., La Jolla, California, a corporation with
annual revenues of $300 million. At that time,
she was responsible for analyzing the corporate
accounting and administrative functions, including
purchasing, in order to develop an automated
management information system.
For six years, Ms. Martin served as a Director
with the San Diego Association of Governments. In
rhis capacity she was responsible for planning,
directing, and controlling the review of grant
requests for public and private organizations
totalling $300 million annually in the areas of
health, employment and training, Truman rBsources,
urban facilities, housing, transportation, law and
criminal justice, energy, environment, and
information systems.
Ms. Martin was a Management Systems Consultant for M
the Center for Research, Inc., Rochester, New York
from 1970 - 1976. Her major responsibilities
included planning, directing and controlling
research and evaluation contracts with the private
and public sectors. Contracts included management
audits and organizational studies, review of
internal information systems and procedures,
assessment of public and private services, surveys
of local government, and legislative analysis. In.
this capacity Ms. Martin evaluated various
administrative functions of local governments and
non-profit agencies.
Academic
Background: B.S. degree, LeMoyne College
M.A. degree, State University of New York, School.
of. Public Affairs
Professional
Activities: California Municipal Finance Officer's Association
American Management Association
United Way - Strategic Planning Committee
f�
GWYN L. HARTMAN
Manager
Management Advisory Services
PUBLIC ACCOUNTING
EXPERIENCE: Four years of consulting experience comple- mented
by several years of experience in industry and
local government.
MAJOR CLIENTS
SERVED: Freedom Newspapers
San Bernardino County Medical Center
Pacific Mutual Insurance
Nissan motor Acceptance Corporation
National Medical Enterprises
RELEVANT
EXPERIENCE: During the past eight years, Ms. Hartman has been
involved in the planning, design, implementation
and evaluation of dai.a processing systems.
Specific technical experience includes:
Analysis of system requirements, pre- paration of
Request for Proposal, and evaluation of vendor
responses in several industries, including manufac-
turing, health care, local government, and a port
authority.
Preparation of a five-year data processing plan for a
rapidly growing finance company.
Served as project manager for the implementation of
new application soft- ware packages including payroll
and accounts receivable systems.
Development of a modeling system used to analyze
financial and medical data of the patient population
(case mix) within a hospital.
Review of various data processing facilities to
evaluate existing systems and determine strengths and
weaknesses in internal control.
-' 40
Analysis of existing manual
systems to determine the
appropriateness of auto- mated
systems.
Design and implementation of
custom manufacturing systems
including shop floor scheduling,
cost accounting, and physical
inventory.
Design and implementation of
custom municipal information
systems including financial
systems, management reporting
systems, and police and fire
dispatch- ing systems.
EDUCATION: biiiversity of California, Irvine
Bachelor of Science, Information and
Computer Science -- 197
Pepperdine University
Master of Business Administration -
1984
CERTIFICATIONS: Certificate in Data Processing
a
z
r!�1_.
Academic
Background:
Professional
Activities:
7
MALCOLM CARLAW
Mr. Car law is a manager in our Orange
County office. Since joining DH&S, he
has performed an inventory reduction
study for a major aerospace company;
investigated and outlined the
engineering, financial, and j
administrative system requirements for a
major energy company; outlined the
manufacturing and financial system
requirements for a made -to -order
equipment manufacturer; designed a cost
accounting system for a made -to -order
manufacturing environment; performed an
alternative cost analysis for an
equipment company; developed charge -back
guidelines for the data processing
department of a major automotive company
with a diverse user environment;
performed a data processing controls
review on the insurance renewal and
payroll departments of a major insurance
firm; and performed a financial
feasibility study for the extension of ,a
200 bed hospital.
M.B.A., University of California
B.A., San Francisco State University
Mr. Carlaw is certified in production and
inventory management by the American
Production and Inventory Control Society.
LAURIE C. BARRINGTON
Experience; Ms. Barrington is a consultant in the Orange
County Management Advisory Services Group. Her
experience includes six years in manufacturing, -
accounting, and cost and operations systems.-
While with Deloitte Haskins & Sells, her
consulting engagements have involved the selection
and implementation of management information
systems for advanced technology companies.
Ms. Barrington has considerable experience in the
design, selection, and implementation of
integrated information systems. Significant
recent experiences in this area include project
management and implementation of cost accounting,
,MRP-II, and financial applications for two
manufacturers of computer systems; design and
installation of a custom work -in -process physical
40
inventory system for a computer manufacturer,
design and implementation of a process cost
accounting system for a printed circuit board
manufacturer; and other system -related engagements'
for manufacturing, R and: D, and services companies.
Prior to joining Deloitte Haskins & Sells, Ms.
Barrington was an Application Consultant with a
data processing services firm. Her
responsibilities included project management
during implementation of manufacturing and
financial applications for clients, a2 well as
design of custom sub -systems and customer
education. Ms. Barrington also has experience in
the direction and supervision of general:
accounting and financial reporting for a.
manufacturing firm..
Academic
Background: B.S, Business Administrattion/Accounting,
California State. University, Long Beach
�43-
r
�
MICHAEL R. FORD
Experience; Mr. Ford joined Deloitte Haskins & Sells in August
of 1984 after completing a dual Master's degree
program at Ohio State University. While atending
graduate school, Mr. Ford worked directly with
both state and local governments on a variety of
projects.
Mr. Ford assisted in performing a computerized'
cost/benefit analysis on the Midday Fare Structure
for the Central Ohio Transit Authority. In
addition, he has assisted in developing a public
land information system for the City of Columbus,
Ohio. Both projects included collecting,
tabulating and analyzing data.
Prior to joining Deloitte Haskins & Sells,
Mr. Ford worked as a full time student intern with
the Ohio Department of Development. Specific
responsibilities included: assisting in the
preparation of the annual performance report to
H.U.D. for Fiscal Year 1982 Ohio CDBG program;
automated the Fiscal Year 1983 Ohio CDBG files,
assisted in designing a Fiscal Year 1983 Ohio CDBG
Management Information System; prepared the 1983
Annual Report for Ohio Metropolitan Housing
Authorities; and assisted in the 1983 Ohio Housing
Needs Plana
Since joining Deloitte Haskins & Sells, Mr. Ford
has worked as lead consultant for two
engagements. He recently finished an engagement
with San Bernardino County in which he assisted in
preparing a cost/benefit study on the transfer of
the Child Support Program to the District
Attorney's Office. He is currently lead
consultant on an engagement to perform various
management and fiscal audits for the Los Angeles
County Grand Jury including a review of the
counties contract and budgeting process. y F
€
-Academic
Background: Bachelor of Arts i,1 Political Science, Bowling
Green State University, Ohio.
Master of Arts in Public Administration, Ohio
State University.
Master of City and Regional Planning, Ohio State
Univer is ty
-44-
I
VII.FIRM QUALIFICATIONSfREFHRENCES
Deloitte Haskins & Sells, International
Deloitte Haskins & Sells is one of the largest public
accounting and management consulting firms in the world. Our
international organization includes over 26,000 people with
400offices 'in 71 countries. Here in the U.S., we have 100
offices, nine of which are in California.
The personnel in our practice offices are supported by the
total nationwide resources of our Firm. These resources
include the Technical Research Department of out Executive
Office in New York City., or National Affairs Office in
Washington, D.C., and our designated' industry specialists in
virtually all areas of the economy.
Deloitte Haskins & Sells has made a strong commitment to
render the highest quality service to the public sector and
to provide our clients with responsive, personalized
attention. We have focused substantial resources on meeting
and diverse and specialized needs of our clients, including
the Federal., state, county and city governments, special
districts and educational institutions.
We have participated at all levels of the industry, including
performing audit and tax engagements, fi.nancil management
advising, designing and integrating data processing systems,
selecting and implementing hardware and software systems,
analyzing organization structures, performing human resource
studies, and reviewing government operations.
As a result of our dedication and service to the public
sector, we have earned an excellent reputation. We: aye
particularly proud of out diversified clientele and the broad
base of experience we have achieved both here in Southern
California and throughout the country. We believe our
extensive experience will prove especially useful to the City
of Huntington Beach.
Public Sector Clientele
City of Los Angeles
County of Los Angeles
City of San Diego
City of Chula Vista
City of Carlsbad
San Diego Transit Corporation
City of Henderson
Riverside County
San ,Bernardino County
City: of San Francisco
County of San 'Francisco
.�46- A
I�
Imperial County
`Maricopa County, Arizona
®
Arizona Department of Finance
California State Lands Commission
Southern California Association of Governments
San Diego Association of Governments
Ramona Unified School District
Orange County Transpori'ation Commission
Orange County Flood Control District
San Diego Sourlh Bay Union School District
San Diego Community College District
Orange CountyDepartment of Social Services
Tucson Airport Authority
Monterey County
Napa county
40
San Joaquin County
Alameda -Contra Costa Transit District
City of Alameda
City of Emeryville
City of Walnut Creek
County of Monterey
County of San B-nito
County of Santa vlara
County of Santa Cruz
County of Stanislaus - Scenic General Hospital
East Bay Dischargers Authority
Golden Gate Bridge, Highway and Transportation District
®
Marin Municipal Water District
Metropolitan Transportation District
San Diego Housing Commission
University of California
Clark County, Washington
Clallam County, Washington
Pierce County
Seattle Schools District
City of Aberdeen
City of Scottsdale
City of Tempe
Operations and Cost Manzgement
Y
r
In addition to our extensive experience in government
consulting, Deloitte Haskins & Sells provides a full range of
services 'in the Operations planning, audit, and cost
management area. These services include:
Conducting reviews of departmental operations and key
functional areas, .including purchasing; storage, and
distribution,
�
3
s
-47-
r
Designing and installing systems for:
.. Forecasting
Master Scheduling
.. Materials _Requirements Planning
.. Inventory Control
.. Order Encry and Control
Purchasing
Bills of Material
Production Planning and Scheduling
.. Capacity Planning
,. Shop Floor Control
.. Physical Distribution
Warehousing
Budgeting
Cost Accounting
.. Responsibility Reporting
Analyzing work methods and procedures
fl
Defining information requirements, selecting computer
software and hardware, and monitoring installation of
EDP systems
Applying analytical techniques to optimize operational
efficiency
Designing and conducting training programs on operations
management
In the San Diego, San Francisco, and Los Angeles offices, we
have staff dedicated to operations; management, including
purchasing, inventory control and warehousing. Some of the
clients we have served specifically in the area of
procurement and inventory control are shown below. We have
also indicated references for some of our clients. x
Long Beach Public Transportation Company - 3/84 - 8/84
We are currently engaged to assist in the development of
a Procurement Policies, Standards, and Procedures Manual f
which:
Sets out, in one document, the procurement policies a
and standards of the Lang Beach Public
Transportation Company. This includes policies
which promote affirmative action in contracting and
purchasing.
Provides sufficient guidance and cross-references to
facilitate compliance with federal procurement ro
policies and regulations.
Provides step-by-step procedures to Long Beach
Transit personnel for the proper and efficient
execu*-ion<of procurements for materials and outside "
services.
r48_
Enables Long Beach Transit to receive federal
certification of the Compae,y's third -party
contracting process.
Reference
Mr.. Patrick. Butters
Assistant General. Manager
Long Beach Public Transportation Corporation
PO Box 731
Long Beach, California 90801
Telephone Number: (213) 591-8753
Alameda -Contra Costa County Transit District
We are currently assisting the District in implementing
an integrated purchasing, vehicle maintenance, and
inventory management system to he utilized in
conjunction with AC Transit's new Central Maintenance
Facility. The integrated system includes the following
modules:
.. Purchasing and Receiving
.. Vehicle Maintenance
Materials Management
.. Fixed Asset Management
The system will utilize state-of-the-art hardware and
software, including portable optical scan technologyfor
each of the four systems.
Reference
Mr. Nathaniel A. Gage
Assistant General Manager for Finance
Alameda -Contra Costa County Transit District
508 16th Street
Oakland, California 94612
Telephone Number: (415) 891-4891
Metropolitan Transportation Commission - San_ Mateo
County Transit District
We: are engaged in a performance audit of the San Mateo
County Transit District for the Metropolitan
Transportction Commission. As part of our detailed
audit of specific functional areas, we are:
., Evaluating and documenting purchasing goals and
objectives
Analyzing purchasing, policies and procedures
., Making recommendations for improvement.
Reference;
Ms. Tk.,eresa Watkins
Metropolitan Transportation Commission
San Mateo County Transit District
Metro Center
101 8ta Street.
Oakland, California 94607
Telephone number: (415) 464-7752
City and County of San Francisco
We are performing a Capital Asset. Management System
Needs Analysis for the City and County of San Francisco
which includes a review of the City's Purchasing
Department and procedures. CAMS is a comprehensive
system for City -aide management of San Francisco's
capital assets on a life -cycle basis. It entails
policies, procedures, automated capabilities, and
management programs for capturing, maintaining,
accessing, and reporting information and asset location,
condition, cost history, funding sources, and other data.
References
Financial Systems Manager
Comptroller's Office
City and County of San Francisco
City Hall
Room 168
Mezzanine
San Francisco, California 94102
Telephone Number: (415) 558-2792
County of Los Angeles Purchasing and Stores Department
We conducted a detailed management audit of the Stores
Division of the Purchasing and Stores Department.
Purpose of the audit was to determine inefficiencies and
where co,3 effective improvements can be made. The
analysiu included, receiving, inspecting, storage,
picking/delivery, and inventory management. A general
overview of purchasing was also conducted to determine
purchasing/stores interfaces.
Reference:
Mr. Thomas Torske
Chief Deputy Purchasing Agent
Purchasing and Stores Department
Cojnty of Los Angeles
2500 So. Garfield Avenue
PO Box 22259
CX y of Commerce, California 9ti00
Telephone number: (213) 728-1311 Ext. 2413'
_50-
University of Nevada
We designed a state-of-the-art integrated management
information. system for this multi -campus university.
The system included all financial and management
components, including purchasing- The, initial phase of
this project included a requirements analysis of the
purchasing operation.
California State Universi
We prepared a feasibility study report for an integrated
business system, including purchasing, financial
management reporting, budget preparation, accounts
payable, accounts receivable, and payroll.
State of Uzah, Division of Finance
We prepared a conceptual design for a statewide
financial and management system which included
purchasing, budgets payroll/personnel, accounts payable,
inventory, fixed assets, and accounts receivable.
Hughes Helicopter
We reviewed the. Procurement System within the Materials
Division to determine if:
Purchase order processing time could be reduced
Proper controls were being maintained
.. Document traceability exists in the system
Procurement's automated support systems are being
used in an effective and efficient manner
Mr. Larry Bernardin
Assistant Controller, Cost Management
Hu-,hes Helicopter
Culver City, California
Telephone Numbert (213) 305-5000
South Bay Union School District
(Analysis of alternatives, selection and implementation
of telephone system, on -going - 1984).
Mrs Joseph Nolan
Assistant Superintendent of Business
South Bay Union School District f
601 Elm Avenue
Imperial Beach, California 92032
®
Telephone Numbert (619) 423-4555
t
- 51
Aft
CONSULTANT AGREEMENT BETWEEN THE CITY OF I UNTINGTON BEACH
AND DELOITTE, HASKINS AND SELLS FOR ASSESSMENT
OF PURCHASING CENTRAL SERVICES
THIS AGREEMENT, made and entered into this 18th day of March, 1985, by and
between the CITY OF HUNTINGTON BEACH, a municipal. corporation of the State of
California, hereinafter referred to as "CITY", and DET OITTE, HASKINS AND SELLS, a
general partnership authorized to do business in California, hereinafter referred to as
"CONSULTANT".
WHEREAS, CITY desires to engage the services of a management consultant to.
prepare a study to analyze the City Purchasing/Central Services operations, plan; and
CONSULTANT has been selected to perform said services,
NOW, THEREFORE, it is agreed by CITY and CONSULTANT as follows:
1. PURPOSE
CITY hereby contracts with CONSULTANT to provide assistance to CITY. in
addressing specific questions as set forth in Exhibit "A" which is dated January 15, 1985'
and entitled, "A Proposal for Purchasing Assessment Study for the City of
Huntington Beach" hereinafter referred to as Exhibit "A" and incorporated herein by
reference.
2. SCOPE OF WORI{
CONSULTANT will provide the services to be rendered as. set forth In
Exhibit ".A", workplan for addressing specific issues related to purchasing, reproduction,
mail distribution, ttilecommunication, office supply inventory and salvage. The City's
objectives include the following criteria of the contractor:
.Identify the current operation of the Purchasing/Central Service Division.
.Review and assess the Division's staffing requirements
.Determine current .level of performance and problem areas for the Division, '
.Review and assess the Division's contract procedures,
.RevYew ai!d assess the warehousing procedures
.Determine the responsivenei+s of the current operation, v
,Design a conceptual Management information Systems.
3. COSTt FEE, AND PRICE
CITY agrees to pay CONSULTANT consideration for its services as described
herein. The maximum price,to be paid by CITY to CONSULTANT, shall. not exceed
Twenty T ;ousapd Five Hundred, Dollars ($20,500}.
4. TIME PERIOD
The term of this Agreement shall be foz nine (9) weeks. CONSULTANT shall
complete and submit all work products to CITY in accordance with the schedule set forth
in Exhibit "At1.
5. INVOICES
CONSULTANT shall submit monthly invoices in duplicate to CITY.
CONSULTANT shall be compensated for the services of those personnel employed as
required in the performance of the Agreement on the basis of standard billing rates of
said personnel for the time such personnel are utilized in connection with the work
necessary to fulfill the terms of this Agreement. A schedule of costs shall ',e included in
Exhibit "A" to this Agreement. Copies of receipts, bills, etc., for all individual cost items
in excess of Two Hundred Fifty Dollars ($250) shall be attached to the invoice.
6. PAYMENT
All payments by CITY shall be made in arrears, after the service has been
provided. CITY shall pay on a monthly basis in accordance with the work on the project
actually completed, as certified and billed by the CONSULTANT in his monthly invoice.
Payments for services performed directly by CONSULTANT shall be by voucher or check
payable to and mailed first class to:
Deloitte, Haskins and Sells
701 1113" Street, Suite 1900
San Diego, California 92101
7. TRANSFER OF TITLE `CO EQUIPMENT
Equipment and supplies purchased by CONSULTANT as a direct -charge item in
connection with the performance of this Agreement shall become the property of the
CITY upon payment of invoice for that equipment and supplies submitted by
CONSULTANT,
NT.
8. INSPECTION
';ONSULTANT shall permit the authorized representatives of the CITY to
inspect and audit all data and records of the CONSULTANT relating to performance under
this Agreement for a period of three (3) years following final payment for services
rendered.
9. TEl<MINATION
If, through any cause within its control, CONSULTANT shaii fail to fulfill, in a
timely and proper manner, its obligations under this Agreement, or if CONSULTANT
violates any of the "terms or stipulations of this Agreement, CITYwill notify
CONSULTANT n writing of the deficiency. if deficiency is not removed within two (2)
weeks, CITY shad thereupon have the right to terminate this Agreement by giving written
notice to CONSULTANT of such termination and to specify the effective 4date thereof, at
i
least five (5) days before the effective date of such termination. In that event, conies of
all ` finished or unfinished documents, reports, and other materials prepared by
CONSULTANT under this Agreement shall, at the option of CITY, be made available to
the CITY, and CONSULTANT shall be entitled to receive compensation for all appropriate
labor and materials costs incurred prior to termination date.
Notwithstanding, the above CONSULTANT shall not be relieved of liability to
CITY for damages sustained by CITY by virtue of any breach of Agree-ent by
CONSULTANT, and CITY may withhold any payments to CONSULTANT for ; fi purpose
of set off until such time as the exact amount of damage due to the ": Y from
CONSULTANT is determined. The maximum amount of any such damages shall not
exceed the total amount of this Agreement.
The CP!'Y shall be liable for all costs and a prorate of the fixed fee incurred prior
to the stopwork period and for restart. CONSULTANT shall make all reasonable efforts
to minimize 'costs to the CITY.
CONSULTANThasthe same rights of termination as CITY.
10. CHANGES
In the event CITY orders changes from the list of work shown in Exhibit "A", or
for other causes orders additional CONSULTANT work not contemplated hereunder,
additional compensation shall, be allowed for such extra work. CITY shall promptly notify
CONSULTANT in writing by change order of all changes in scope. Change orders shall
specify a cost limit. All change orders shall be mutually agreed to by both CITY and
CONSULTANT
11. INFORMATION AND DOCUMENTS
All information, data, reports., records, charts, survey results as are existing
P.nd availabl: for carrying out the work as outlined in Exhibit "A", hereof, shall be
furnishedtoCONSULTANT without charge by CITY, and CITY shall cooperate in every
way possible in the carrying out of the work without undue delay All reports, manuals,
etc., produced by CONSULTANT relating to the project shall be owned by CITY.' u
CONSULTANT may retain and use internal ^opies of all working paper - and project
products.
12. MANAGEMENT
During the term of this Agreement, CONSULTANT si,all provide sufficient,
executive and administrative personnel as shall be necessary and required to perform its
duties and obligations under the terms hereof. W. Frank Panarisl shalt be in direct
z
charge of the project and shall supervise and direct; the project. Any change in the
management of Mis Agreement by Mr. Panarisi shall be approved by the CITY in. writing.
,r
property damage of $300,000 per occurrence. Said policy of insurance shall specifically
prov.,ie that any other insurance coverage which may be applicable to the PROJECT shall
be deemed excess coverage and CONSULTANT's insurance shall be primary. A
certificate of insurance providing the current existence of said policy shall be delivered to
the City attorney prior to the commencement of any work hereunder. All insurance and
evidence thereof shall be subject to approval by the City Attorney in writing. The
certificate of insurance and the policy of insurance or endorsements therec< shall provide
that any such policy sh,' + )t be cancelled or modified without thirty (30) days' prior
written notice to the CITY.
18. NON-DISCRIMINATION
In connection with the execution of this Agreement, CONSULTANT shall not
discriminate against any employee or applicant for employment because of race, religion,
color, sex, age, or national_ origin. CONSULTANT shall take affirmative action to insure
that applicants are employed, and that employees are treated during their employment
without regard to their race, religion, color, sex, age, or national, origin. Such actions
shall include, but not he limited to, the following: employment, upgrading, d -motion, or
transfer; recruitment or recruitment advertising; layoff or termination; rate of pay or
other forms of compensation, and selection for training, including apprenticeship.
19. SUBCONTRACTS
CONSULTANT shall not subcontract any portion of the work required by this
Agreement without prior written approval of CITY.
20. PROHIBITED INTEREST
No member, officer, or employee of the CITY during his/her tenure or one year
thereafter, shall have any interest, direct or indirect, in this Agreement or the proceeds
thereof. +
21. NOTICES
All notices hereunder and communications with respect to this Agreement shall
be effective upon the mailing thereof by registered or certified mail, return receipt
requested, and postage paid to the persons named belrw:
TO CITY: TO CONSULTANT:
Mr. Hobert Franz Mr. ,Mark Delane
Chief of Administrative Services Director
CITY OF HUNTINGTON BEACH DELOiTTE, IIASKINTS AND SELLS
2000 ,,fain Street 701 "B" Street, Suite 1900
Huntington Beach, California 92648 San Diego, California 92101
22 SUCCESSION
This Agreement shall be binding on and inure to the benefit of the 'heirs,
executors, administrators, and assigns of the parties hereto.
018231Pg. -5-
13. MATERIALS RETAINED
CONSULTANT shall retain project -related materials and worksheets for a
minimum of three (3) years after the delivery of the final product. Said materials and
reports shall be available on request to the CITY.
14. XEY PERSONNEL
Key personnel identified as the project team shall be assigned to this work and
shall not be replaced by any other persons without this written approval of the CITY.
15. INDEMNIFICATION, DEFENSE, HOLD HARMLESS
CONSULTANT hereby agrees to defend, indemnify and hold harmless CITY, its
officers, agents and employees, from and against any and all liability, damages; costs,
losses, claims and expenses, however caused, resulting directly or indirectly from or
connected with CONSULTANT's pc :formance of this Agreement (including, but not
limited to such liability, costs, dare _t;e, loss, claim, or expense arising from the death or
injury to an agent or employee of CONSULTANT, subcontractor, if any, or of CITY or
damage to the property of CONSULTANT, subcontractor, if any, or of CITY or of any
agent or employee of the CONSULTANT, subcontractor, if any, or of CITY), regardless; of
the passive or active negligence of CITY, except where such liability,, damages, costs,
losses, claims or expenses are caused by the sole negligence or willful misconduct of CITY
or any of its agents or employees including negligent omissions or commissions of CITY, '
its agents or employees, in connection with the general supervision or direction of the
-work to be performed hereunder.
16. WORKERS' COMPENSATION
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. there--);
and all similar state or federal acts or laws applicable; and shalt indemnify, defend and
hold harmless CITY from and against all claims, demands, payments, suits, actions,
proceedings and judgments of every nature and description, including attorney's fees and :
costs presented, brought or vecovered against CITY, for or on account of any liability
under any of said acts which may be incurred by rrgson of any work to be performedby
CONSULTANT under this Agreement.
17. INSURANCE
In addition to the Workers' Compensation Insurance and CONSULTANT's
covenant to indemnify CITY, CONSULTANT shall acquire and maintain in force, until the
complets'in of PROJECT and acceptance a -.11 work by CITY, a, policy of general liability
insurance in which CITY is named as an additional insured. Said policy shall indemnify
CITY, its officers and employees.. while acting within the scope of their duties, against
any and all clalms arising out of pr in connection with PROJECT, and shall provide
coverage in not less than the following amounts. Combined single limit bodily Injury or
Q1R��111'g'. •-�
6• t
{SSUe iJATE (14NOONY)
PRODUCER
w
THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS
Davis Do rland & Co.
NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS ::> RTIF1CATE DOES NOT AMEND,
EXTEND OR ALTER THE COVERAGE AFFORDED BY THE 00LICIES BELOW.
Two World Trade Center
New York, New York 10048
COMPANIES AFFORDING 'COVERAGE
COMPALE-TTER ZURICH INSURANCE COMPANY
COMPAII..
INSURED Deloitte Haskins & Sells
LETTER _
One World Trade Center
COMPANY c
New York, New York 10048
LETTER
COMPANY n
LETTER
^��•.
�J
67��tQa
COMPANY E
LETTER
THIS IS Ta CERTIFY ,'HAT POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO Tt�E INSURED NAMFD ABOVE FOR THE POLICY PERIOD INDICATED.
NOTWITHST.::DING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHEN DOCUMENT WITH RESPECT TO WHICH THIS C;7,111FICATE MAY
BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEF•EIN 1S SUBJECT TO ALL THE TERN.1, EXCLUSIOIsS, AND CONDI
TIONS OF SUCH POLICIES.
A
TYPE Or INSURANCE
POLICY NUMBER�Jc1C+
Ft'ITw�
flA�—tkNYi
AN,
wk lx�Jt'Ol+
LI BILITY LIMITS IN THOUSANDS
EUAR^�c
AGGREGATE
LTR
DAii :Fflk+.Hi:?�'0�,�,
GENERAL
x
LIABILITY
-
TOP 3251936-00
l/l/85
BODILY
l/l/86 INJURY $
$
A
COMPREHENSIVE FORM
$
PREMISESJOPERATTONS
FROKRTY
$
UNDERGROUND
EXPL()WN & COLLAPSE HAZARD
PROOUGTS+COIAPLETED OPERATIONS
CONTRk=AL
s �'
fi"`�- pd-
GARAGE
Bt 3 FD
GObI$`.EO $ 1,000,
$ 1,000,
..
I14OFPEIJOEN7 CONTRACTORS
BROAD POW PROPERTY OA+AAGE(-
PERSONAL i+UURY
j /r/
1 •/ate
1 PERSONAL INJURY
AUTOMOBILE
LIABILITY
nr3ir rat
ANY AUTO
Km
ALL ALL OWNED AUTOS IPRY- PASS)
}!
ALL OWNED PUTOS (O'HERRIV P 1
i
h"..
`$
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HIRED AUTOS
#
P1aOPhATY
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GARAGE LIABILITY
1
D; a Fc
y
__
EXCESS LIA13ILITY
p
UMBRELLA FMI
81SWI
COMBINED
$
$
OTHER THAN UMBRELLA FORM
f
STATUTOPY
WORKERS' COMPENSATION
`' $ IO�,EACH ACCIDENT)
A
AND
WC 3251930-01
l/l/85
1/1/86
c,O15EASE POLICY I.II,IcT} {
EMPLOYERS' LIABILITY
$iDEA5E EACHEIIP OVEEI
orHER
De,A HlPI ION OF UPEHATIONS�TIONSNEHICLSISPECiAL ITEMS
Coverage in effect with regard to work contract to study and analyze the City/Purchasing/
Central Service Division for the City of Huntington Beach, California and includes the
inl-arac4•. of I-lhc ('if-v nF 14imtinahnn Ranch under liability as resvects this Contract.
SHOULD ANY OF THE A13OVE DESCRIBED POLK;MS 8Z CANCY.IJ40 OEFOM THE Ex -
Mr. Robert Franz, Chief of Admn. Servic PIAATig6 DATE THEREOF. THE ISSUING COMPANY WILL
CITY OF HUNTINGTON BEACH+dNL . _-. DAYS WRITTEN `it=ICE TO THE CEii IRCAYE HOLDER NAMED TO THE 1.
2000 Main Street LEFT � ` ' MR
Huntington Beach, California 92648 AurHORI RE NT,ATIVE � ""
DATE (.MM/DDYY)
Davis, Dorland 6 Co.
Two World Trade Center
New York, New York 10048
INSURED Deloitte Haskins & Sells
One World Trade Center
New York, New York 10048
i
THIS CERTIFICATE IS';SSUED AS A MATTER OF INFORMATION ONLY AND CONFERS
NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AMEND,
EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW.
COMPANIES AFFORDING COVERAGE
LETTERNY ZURTCH INSURli_NGZ- COMPANY
°LEOTMIERY
COMPANY
LETTER
COMPANY
LETTER
COMPANY E
LETTER
THIS IS TO CERTIFY'rHAT POLICIES OF INSURANCE LISTED BELOW HAVE BEEN iSSUEDTO 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 15 SUBJECT TO ALL THE TERMS. EXCLUSIONS, AND CONDI-
TIONS OF SUCH POLICIES,
CO
LTR
TYPE OF INSURANCE
TY LIMITS IN THOUSANDS
M
POLICY NUMBER ..A'F A+1.:Y:^.Y. FA:h+W�
fti4PRE E
AGGRE3ATE
GENERAL UABILITY
+BOG Iv
TOP 3251936-00 1/a/85 ! 111/86 r� � a+ $
+$
COMPREHENSIVE FOFCA
------- -
PREMISESiOPERA;tONS
UNOERGRttiJ"NO
PAUPER-1'+
j DAMAGE
$
EXPLOSION & COLLAPSE HAZARD
i
PRODUCTS,IGOAPLETED OPERATIO45
CONTRACTUAL
I 9 a{q yJF^ � $ 1,000,
$1,000,
INDEPENDENT CONTR,AC1ORS
{
BROAD FORM PROPERTY OANIAGi
PERSONAL ;NJURY
PLRSi rlAt N 'JURY
$
I
AUTO&70BILE
LIABILITYTn'
$
:
ANY AUTt'
�..�....._...-...
ALL (YJANED ALIT O& TARTY PA S',
5
$
jwm
#t '
ALL OWNED ANJ!OS OTHER THAN`
PRft' PASS
xaA^3ti }
HIRED AUTOS
"ION -OWNED AUTOS
GARAGE Lb IL"
F.
{
EXCESS LIABILITY I
I
64 3 FI7
UMBRELLA FORM
)COUBar[D�
$
$OTHER
THAN UMBfLLLA FORM
f i
WORKERS` COMPENSATION
STATUTORY
�
100 tEACH ACOIOthl"i
A
AND
WC 3251.930-0:i
l/l/85
1/l/86
t � MSEasEPOiICY Lttdlt)
EMPLOYERS` UABIIiTY--
f MP'f YEE)
�.� 4
$ iDAEASE -EACH
OTHER
I
I DESCRIPTION OF OPERAYiONSIL(r. ATiONS)VEHICLESISPECIAL ITEMS
Coverage in effect with regard to uork ccmtract to study and analyze the City Purchasing/
f Central Service Division forthe City of Huntington Beach, California and includes the
,
SHOULD ANY OF THE ABOVE DESCRIBED POLKxES BE DANCE
Mr. Za'hu$�t PranZ', Chief. of ;Ad&=,. Servi PIRATTON DATE THEREOF, THE ISSUING COMPANY 1
0 fiViv�Gai�A iQti +RAIL ,.IG—DAYS WRITTEN NOTICE TO THE CERTIFICATES H
CITYLEFT y K
2000 Wb. Street ,
Rmtingtnt Beach, California 92648 AUTHORM RE NTATIVE