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Home My Public Portal About10) 10B Agreement with San Gabriel Valley Humane SocietyAGENDA ITEM 10.8. COMMUNITY DEVELOPMENT DEPARTMENT MEMORANDUM DATE: April 2, 2019 TO: The Honorable City Council FROIYI:: . · !·::::~: ... BfYan Cook, City Manager :-<< · ·· 'SY:. Michael D. Forbes, Community Development Director l !.) ,.. • • ... 1 •.. ' • s ·UBJECT: AGREEMENT WITH THE SAN GABRIEL VALLEY HUMANE SOCIETY ··, .. > . ·· :; .... <FOR ANIMAL CONTROL, SHELTER, AND LICENSING SERVICES '·, ~ • ..: t \ '•I' :, RECOMMENDATION: The City Council is requested to provide direction to negotiate an amended agreement with the San Gabriel Valley Humane Society (SGVHS) for animal control, shelter, and licensing seNices. BACKGROUND: 1. ·on J1,me 7, 2016, the City Council approved an agreement with SGVHS for animal control, shelter, and licensing services. The agreement provides for an initial three- year term ending June 30, 2019. The agreement automatically renews annually thereafter for a maximum of five years through June 30, 2024, unless SGVHS or the City provides notice of intent not to renew the agreement at least 90 days prior to the end of the term. 2. On February 26, 2019, SGVHS provided verbal notice of their intent not to renew the agreement and to seek an amended agreement with a higher fee. 3. On March 15, 2019, SGVHS provided formal written notice of their intent not to renew the agreement under the existing terms, and to seek to amend the agreement to allow ·for annual increases at a mutually agreed upon rate (Attachment "A"). ANALYSIS: The existing agreement provided an initial monthly rate of $15,208 for all animal control, shelter, and license services starting in Fiscal Year (FY) 2016-17, with an automatic annual increase of four percent. After two annual increases, the monthly rate for FY City Council April 2, 2019 Page 2 of 3 2018-19 is $16,448.97. If the existing agreement were renewed for another year, the monthly rate would increase to $17,106.93 for FY 19-20. SGVHS states in their letter that the contracted services cannot be sustained under the current rate structure due to continuing increases in the minimum wage, increases in the cost of providing animal care, and costs to maintain SGVHS's aging facility and vehicles. To cover the costs of providing services under the agreement, SGVHS is seeking a monthly rate of $21,000 for FY 19-20. This represents an increase of about 28 percent over the current rate and is about 23 percent above next year's rate under the existing agreement. Rather than commit to another multi-year agreement with automatic increases, SGVHS is requesting to commit to an annual agreement and renegotiate the rates each year due to continuing cost increases. In 2016, staff recommended that the City directly negotiate an agreement with SGVHS in lieu of issuing a request for proposals (RFP). SGVHS has provided animal shelter services and after-hours animal control services for Temple City since at least 1980, and full-time animal control services since 2012. SGVHS has consistently provided Temple City with good service and has been willing to immediately address any service concerns. SGVHS's facility is in San Gabriel, which is nearby and convenient for Temple City residents. If an RFP were issued now, it is unlikely that the City would receive competitive responses other than from SGVHS. The City of Rosemead recently issued an RFP for animal control services and received only one response, from SGVHS. No other agencies providing animal control services in or near the San Gabriel Valley submitted proposals, including the Pasadena Humane Society & SPCA, Inland Valley Humane Society & SPCA, Southeast Area Animal Control Authority, and Los Angeles County Department of Animal Care and Control. For these reasons, staff recommends that the City continue contracting with SGVHS for animal control, shelter, and licensing services. Staff will discuss a revised fee structure with SGVHS and bring an amended agreement back to the City Council for approval prior to the expiration of the current agreement on June 30, 2019. CITY STRATEGIC GOALS: The City's agreement with SGVHS furthers the City Strategic Goals of Public Health and Safety and Quality of Life by ensuring that the City will continue providing animal control, shelter, and licensing services for the community. City Council April 2, 2019 Page 3 of 3 FISCAL IMPACT: The proposed FY 2019-20 City Budget will include the funds necessary to cover the new fees as mutually agreed upon by the City and SGVHS and provided by the revised agreement, subject to approval of the agreement by the City Council. ATTACHMENT: A. Letter from SGVHS dated March 15, 2019 March 15, 2019 Mr. Michael D. Forbes , AICP Community Development Director City of Temple City 9701 La s Tunas Dr . Temple City, CA 91780 Dear Michael, ATTACHMENT A San Gabrie l Valley Humane Society ("SGVHS") is proud to serve the City of Temple City and all its residents . As a commu nity shelter, we very much value th e partnerships we have buil t and are continuing to build w i th t he cities in our area. As we enter our 95 th year, we look forward to many more years of service! Our existing contract for animal control and sheltering services began in June 2016 . The contract provides for a 4 % compensation inc rea se annually through June 30, 2024. As we recently discu sse d, SGVHS cannot sustain contract services without a more significant increase effective July 1, 2019. SGVHS proposes that we amend the contract to allow for annual increases at a rate mutually ag ree d upon each year. Consistent with th is approach, SGVHS respectfully requests an i ncrease in annual compensation from $197,388 (for the period from July 1, 2018-June 30 , 2019) to $252,000 (for the period f rom July 1, 2019 -June 30, 2020), a 28 % i ncrease . Th is i ncrease is ne cessitated by the continuing i ncreases i n the California minimum wage, increases in the cost of car ing for the animals entering our she lter (vaccinations, food, litter, etc.) and the costs to mainta in our aging faci lity and an imal con trol vehicles. I w ill be more than happy to meet with you and other City representatives to discuss the nee d for this i ncrease and review our financia l statements and facility needs . Ple ase note that as SGVHS has gross revenues we ll under $2 ,000,000 per year it is not requ i red to have an audit. (California Government Code section 12586(e)(1)) However, in order to p rov ide transparency, we do have an independent CPA conduct a review of our f i nancials every two years. I can currently provide the financial review for the 2015 and 2016 calendar years. The review for the 2017 and 2018 calendar years will not be completed until later this spring. But I can provide our i nternal financials for those periods when we meet. Michael, I loo k forward to working with you as we continue to bu i ld the partnership between Temple City and SGVHS to ensure the ani ma ls of your City receive the attention and care they need and deserve. s~- cvnthiaA. R~ Board President 851 E. Gr and Avenue San Gabriel , California 91776 626.286 .11 5 9 www.sgvhumane.org Ta x ID 95-1661090