City Non-Profit Contracting Task Force
Master Contract Committee
City Contracting Task Force
Master Contract Committee Meeting
City Hall, Room 316 Conference room
June 20, 2002
1:00 - 3:00 p.m.
Minutes
Participants: James Illig, Project Open Hand
Bill Jones, Office of Contract Administration
Angela Karikas, Office of the City Attorney
Gregg Sass, Department of Public Health (DPH)
Judith Stevenson, Baker Places
Monique Zmuda, Department of Public Health (DPH)
Winnie Xie, Department on the Status of Women
Scribe: John Haskell, Controller’s Audits Division
Not Present: Winna Davis, Department of Children, Youth & Their Families (DCYF)
Luis Espinoza, Office of Contract Administration (OCA)
Jim Illig chaired the meeting.
The subcommittee continued its discussion of the master contract concept. Jim said that one agency could have a multi-year agreement for a single service with a maximum dollar amount. Baker Places measures 90 percent of its services in bed days and 10 percent in service units, so its services could be easily provided through a master contract.
Monique noted that having annual dollar limits is a way to control expenses. A contract can have a $1 million budget, but the intent is to spend only $750,000. Jim noted that with a multi-year agreement there would be a maximum dollar amount for the entire period (for example, 3 years). Monique noted that the budget for a 3-year, $3 million contract ($1 million each year) would not change unless there was a change to the encumbrance. If there was a change, in the second year for example, the contract would have to be modified. Jim asked how would a multi-year contract work without modifying it? If a contract under a master agreement spent less than budgeted in one year, could funds be shifted to another contractor under the same agreement? Angela Karikas said that if there is any change in a contract provision from one year to the next, it must be modified.
The group discussed what attributes of a multi-year agreement would need to be present. Bill Jones suggested that it contain terms and conditions (with a "not to exceed" amount), a budget, a workplan, and compliance issues.
Monique noted that under a master agreement, funds could be shifted from one agency to another, but most agencies spend their money. DPH does get additional federal and state funds during the year, but contract modifications are necessary in order to add to contracts. Judith Stevenson asked if the issue is modification of contracts, what can be eliminated? Monique said the modification process is not that complex when all you want to know is how the budget will change and the change is less than 10 percent of the total. However, the process does take 7 weeks and approvals from City Attorney, Controller, and Purchasing are necessary. Monique noted that with online approval authority, she can cut this time in half. Contracts modifications include changes in terms/conditions; changes in dollars; changes in how contractor is reimbursed; and changes in scope of work. Also, any change over $50,000 has to be reviewed by HRC. Would the Task Force recommend raising the amount?
Monique noted the Task Force is in agreement on the idea of pre-approved contractors. If a contractor has everything on file (they would still need to have an up-to-date workplan), any department that wanted to use their services could use a master contract to buy them.
Bill Jones said the master contract would have the contract term, terms and conditions, a not-to-exceed amount, and a workplan. Each department using a master contract would have to have a workplan, a budget (with not-to-exceed amount), a compliance update (insurance is current, etc.), and encumbrance amount. Monique noted that it’s not possible to include every detail in the master, but a workplan and outcomes are necessary.
Winnie Xie suggested consolidating funding types in single departments. The Department on the Status of Women receives funding from various sources for one type of service. Two or more departments providing the same service should get together to agree on a contract that serves all their needs.
The subcommittee agreed to make a recommendation for consolidating contracting across departments. Where appropriate, departments should transfer contracts with the same provider to one department to serve as the lead contract administrator. The subcommittee believes there are 3 main concepts it is working toward: 1) Online approvals; 2) Consolidating documents in one place, and 3) Multi-year master contracts.
Monique noted that the Mayor and the Board want more accountability, for example, proposing a Charter change to lower the $10 million threshold for Board approval of contracts. Departments are asked to submit a lot of information on their contracts to the Board. Monique suggested that a pilot effort be done (perhaps with Baker Places) and see how the Board responds to it. Jim noted that a system of assigning risk levels to contractor organizations would allow those with low risk to bypass approvals and other procedures now required.
To summarize the subcommittee work so far:
" There is no agreement on a definition of a master contract
" There is agreement on streamlining and approving contracts including:
" Central depository of documents for compliance
" Online approval capability
" Consolidation of documents
" Multi-year contracts with not-to-exceed amounts
" Where appropriate, consolidate contracts across departments
" Increased automation where possible
