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CITY COUNCIL AGENDA ITEM NO. 11

Meeting Date: February 28, 2006

Subject/Title: Amendment to the Legal Services Agreement with McDonough, Holland and Allen in an amount not to exceed $150,000

Prepared by: Damien Brower, City Attorney

Submitted by: Damien Brower, City Attorney

RECOMMENDATION
Adopt a Resolution approving, and authorizing the City Manager to execute, Amendment No 2 to the legal services agreement with McDonough, Holland and Allen in an amount not to exceed $150,000.

PREVIOUS ACTION
On August 10, 2004, the City Council approved Resolution No. 2004-198 authorizing the City Manager to execute purchase orders or contracts for various vendors. A legal services agreement, not to exceed $150,000, with McDonough, Holland & Allen (MHA) was included in this Resolution.

On June 14, 2005, the City Council approved Resolution No. 2005-133 authorizing the City Manager to execute an amendment to the professional services agreement with MHA to increase the agreement amount by $340,000 for Interim City Attorney services.

On June 14, 2005, The City Council approved Resolution No. 2005-143 adopting the 2005/06-2006/07 Operating Budget for the City of Brentwood.

BACKGROUND
In August 2004, when the City Council authorized the City Manager to execute a purchase order with MHA, the subsequent vacancy in the City Attorney’s Office was not anticipated. On March 1, 2005, the City retained the services of Thomas Curry of MHA to serve as the City’s Interim City Attorney. On August 8, 2005, I was sworn in as Brentwood’s City Attorney.

Counsel from MHA provides specialized legal assistance on various issues, including affordable housing, civil litigation, redevelopment, and construction issues. In addition, they appear on behalf of the City in certain court proceedings, including weapons confiscation petitions and motions to review police personnel records (“Pitchess” motions). The firm also supplements the City’s general legal needs and has done so since the creation of an in-house City Attorney’s Office.

Since my arrival, I have been working with the Finance Department to examine how the costs for the above matters have been allocated. Although a cursory review may suggest that the money appropriated for outside legal costs comes exclusively from the City’s general fund, this is not the case. Many projects handled by special counsel are appropriately charged to specific project accounts with their own budgets, including assessment districts and enterprise accounts, such as sewer and water. Legal services agreements, invoices and City Council staff reports do not, however, always reflect this information.

To ensure that outside legal costs are charged to the proper account and not simply the general fund, the City Attorney’s Office and Finance Department have been reviewing and re-codifying prior legal invoices. In addition, the billing categories of special counsel invoices are being revised to include more specific categories. These revisions allow for better tracking of expenses and ensure the proper accounting of legal costs. As new assignments are given to outside counsel, new billing entries will be added and, if appropriate, old entries removed.

Along with the above efforts and a rigorous review of outside counsel invoices, the City Attorney’s Office will work with the Finance, Community Development and Engineering Departments to ensure that future developer deposit accounts include payments for any required legal review. Such a system is often employed in other cities and serves to lower legal expenses associated with project reviews. Similarly, future development agreements will include a provision that requires the developer to pay the City’s legal expenses associated with implementing the agreement. Although such a clause is not uncommon in cities throughout California, it has not been included in past Brentwood development agreements.

Finally, to better account for outside legal costs separate legal services agreements will be entered into with private law firms for project specific matters. Generally, these separate agreements will be used when the City is facing a lawsuit that is not covered by the Joint Powers Authority Risk Pool or for a particularly large project. For example, MHA currently represents the City in several litigation matters that have underlying specific project accounts. Under the authority granted the City Manager by the Purchasing Ordinance, separate agreements will be entered into with MHA for these matters. Should costs associated with these matters approach the limits of the City Manager’s authority, the City Council will be asked to amend the agreements as appropriate. These agreements will better protect the general fund and ensure that outside legal costs are being paid for from the proper City account.

With regard to the subject of this staff report and as stated in the Previous Action section, in June, 2005 the City Council approved an amendment to the legal services agreement with MHA increasing the total amount of the agreement by $340,000. At the time, it was anticipated that these funds would be used for services through August of 2005. Since August 2005, the remaining balance of the $340,000 was utilized for MHA legal expenses. With approximately four months remaining in the current fiscal year, the previously approved funds to spend on MHA are almost exhausted. It is therefore necessary to approve additional funds to spend on MHA for the remainder of Fiscal Year 2005/2006 and the attached amendment accomplishes this action. It should be noted that this action does not ask for a budget increase. The funds to be spent will come from the existing City Attorney’s budget. It is anticipated that for Fiscal Year 2006/2007 the City Council will be asked to authorize a new agreement with MHA, utilizing the City’s new form legal services agreement.

FISCAL IMPACT
Funding for these services are currently budgeted in the 2005/06 Operating Budget. This action does not request a budget increase.

Attachments:
Resolution
Amendment No. 2 to Legal Services Agreement

RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BRENTWOOD APPROVING, AND AUTHORIZING THE CITY MANAGER TO EXECUTE, AMENDMENT NO. 2 TO THE LEGAL SERVICES AGREEMENT WITH MCDONOUGH, HOLLAND AND ALLEN INCREASING THE TOTAL AGREEMENT AMOUNT BY $150,000

WHEREAS, counsel from law firm of McDonough, Holland and Allen (“MHA”) provides specialized legal assistance for affordable housing, civil litigation, redevelopment, and construction issues; and

WHEREAS, MHA appears on behalf of the City in certain court proceedings including weapons confiscation petitions and motions to review police personnel records (“Pitchess” motions); and

WHEREAS, the firm also supplements the City’s general legal needs and has done so since the creation of an in-house City Attorney’s Office; and

WHEREAS, on August 10, 2004, the City Council approved Resolution No. 2004-198 authorizing the City Manager to execute purchase orders or contracts for the not-to-exceed dollar amounts for various vendors, including MHA in the amount of $150,000, for fiscal Year 2004/2005; and

WHEREAS, on June 14, 2005, the City Council approved Resolution No. 2005-133 authorizing the City Manager to execute an amendment to the professional services agreement with MHA in an amount not to exceed $340,000 for Interim City Attorney services; and

WHEREAS, also on June 14, 2005, The City Council approved Resolution No. 2005-143 adopting the 2005/06-2006/07 Operating Budget for the City of Brentwood.

NOW, THEREFORE BE IT RESOLVED by the City Council of the City of Brentwood that Amendment No. 2 to the legal services agreement with McDonough, Holland and Allen is hereby approved and the City Manager is authorized to execute same in the amount of $150,000.

PASSED, APPROVED AND ADOPTED by the City Council of the City of Brentwood at a meeting held on the 28th day of February 2006 by the following vote:

AMENDMENT NO. 2 TO AGREEMENT FOR LEGAL SERVICES
(McDonough, Holland & Allen)

This Amendment No. 2 is entered into and effective as of the ___ day of _______________, 2006, amending the agreement dated __________________ (the “Agreement”) by and between the City of Brentwood, a municipal corporation of the State of California ("City"), and McDonough, Holland & Allen, (“Consultant") (collectively, the “Parties”) for legal services.

RECITALS

A. On June 14, 2006, the City Council authorized the City Manager to execute Amendment No. 1 to the Agreement to increase the total agreement amount by $340,000 for interim City Attorney services; and

B. The Parties desire to increase the total agreement amount by an additional $150,000 for the remainder of the 2005/2006 Fiscal Year.

NOW, THEREFORE, in consideration of these recitals and the mutual covenants contained herein, the Parties agree as follows:

1. The total not to exceed Agreement amount is increased by $150,000.

2. All other provisions of the Agreement, as may have been amended from time to time, will remain in full force and effect.

3. All requisite insurance policies to be maintained by Consultant pursuant to the Agreement, as may have been amended from time to time, will include coverage for this Amendment.

4. The individual executing this Amendment and the instruments referenced in it on behalf of Consultant represents and warrants that he has the legal power, right and actual authority to bind Consultant to the terms and conditions of this Amendment.

CONSULTANT:

McDonough Holland & Allen:

By:

Printed Name:

Title:

Date:
CITY:

City of Brentwood:

By:
Donna Landeros, City Manager

Date:

ATTEST:

By:
Margaret Wimberly, City Clerk

APPROVED AS TO FORM:

By:
Damien B. Brower, City Attorney
 

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