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HomeMy WebLinkAbout07-01-2015 Law Offices of Jones & Mayor - First Amendment to AgreementFIRST AMENDMENT TO AGREEMENT This First Amendment to Agreement is made and entered in the City of San Luis Obispo on 7/1/' , 2015, by and between the CITY OF SAN LUIS OBISPO, a municipal corporation, herein aft 6r r furred to as City, and LAW OFFICES OF JONES & MAYER, a professional corporation, hereinafter referred to as Consultant. WITNESSETH: WHEREAS, on October 1, 2014, the City entered into an Agreement with Consultant for professional legal services related to a personnel disciplinary appeal; and WHEREAS, work on this matter is not yet complete and litigation practices by appellant and his counsel have significantly increased the anticipated length of hearings and volume of work to be performed; and WHEREAS, the parties seek to modify certain provisions of the Agreement between them to address anticipated increased costs related to increased work. NOW, THEREFORE, in consideration of their mutual promises, obligations and covenants hereinafter contained, the parties hereto agree as follows: 1. Section 1. Term of the Agreement is modified to provide that the total costs incurred for the work shall not exceed $50,000. All other terms and conditions of the Agreement, as amended hereby, remain in full force and effect. IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed the day and year first above written. CITY OF SAN LUIS 081SPO N By. J. C tst ne Dietrick, City Attorney S i V1 2 O LAW OFFICES OF JONES & MAYER By: _ - --) zi L Richard D. Jones Its: Owner /President Manager R If • City August 5, 2015 Final City Manager Approval Approver Name Date Approved City Administration JD for DJ 09/16 Reviewer Routing List Reviewer Name Date Reviewed City Attorney jed 8/5/15 Finance & Information Technology mwP 9/8 Police Department CHS 8/18/15 Human Resources MI 8/21/15 FROM: SUBJECT: Recommendation: J. Christine Dietrick }'cd 8/5/2015 Further funding for Personnel Disciplinary Appeal 1. Authorize the City Attorney to execute an Amendment to the Legal Services Agreement with the Law Offices of Jones & Mayer for payments for legal services in a personnel disciplinary appeal (dated 10/1/2014), increasing the not to exceed amount from $25,000 to $50,000. 2. Authorize an additional $25,000 be added to Jones & Mayer encumbrance 933513. $13,656 to come from sources within the existing City Attorney budget, $8,000 from the Police Department budget and the remaining $3,344 to come from the Human Resources budget. 3. Authorize the City Attorney to execute a contract for payments to the hearing officer presiding over the disciplinary appeal pursuant to the City's personnel rules, and the applicable Memorandum of Agreements (MOA), in an amount not to exceed $30,000 and authorize the City Attorney to transfer and encumber that amount from budget sources as identified and directed by the City Manager. 4. Authorize the City Attorney to execute a contract for payments for court reporter and hearing transcript services to McDaniel Reporting in an amount not to exceed $28,000 for 10 days of hearings, creation of transcripts for the administrative record and Council, and authorize the City Attorney to transfer and encumber that amount from budget sources as identified and directed by the City Manager. 5. Authorize the use of a portion of the salary savings ($58,000) from the vacant Police Chiefs position for the purpose of funding the remaining costs related to this request. Further funding for Personnel Disciplinary Appeal Page 2 Attorney Fees Last year the City Attorney's Office issued a Request for Proposals for on -call legal services, requesting proposals in a variety of practice areas. The law firm of Jones & Mayer was a successful proposer and is currently on the City's on -call list for personnel and employment matters. Greg Palmer of that firm has specialized expertise with police and fire personnel and termination matters and the City Attorney had consulted with Mr. Palmer for advice in the early stages of this particular matter. Mr. Palmer has also previously represented the City in such matters. Based on discussions with Mr. Palmer, review of other RFP responses, cost comparison, and experience with other qualified attorneys in this area, as well as his baseline knowledge of the case from the prior consultation, the City Attorney determined that Mr. Palmer was the most appropriate and cost effective representation in the current police termination matter. It is necessary to retain outside counsel in these proceedings because the City Attorney is the regular advisor to the City Council and having the Council act as an independent reviewer of a decision on which the City Attorney has already advised and advocated, raises due process concerns that could subject the Council's final decision to challenge, depending on the hearing officer's recommendation and the Council's final action. In 2014, the City Attorney engaged Mr. Palmer's services to represent the City in this matter up to Department Head authority and, in December, City Manager approval was given to continue the legal services engagement with costs not to exceed $25,000. $2,000 of this further funding came from the Legal Services budget of the City Attorney department, with the remaining $23,000 being transferred via BAR from Ventures & Contingency at the suggestion of the Finance Director. As anticipated, the current matter required significant preparation for the termination appeal hearing, which is now underway. However, we initially anticipated that the hearing on the matter could be completed in three to four days maximum. Unfortunately, opposing counsel is pursuing the matter very aggressively, proceeding at a very slow pace and has insisted that they will need ten full days of hearings to complete their defense; only five have been completed thus far and we have dates booked out through the beginning of October with the hearing officer. Opposing counsel has also served multiple discovery motions and Public Records Act requests, which have driven additional motion/opposition work, despite attempts to minimize costs by managing a significant portion of the discovery in house. The additional outside counsel work on this matter is estimated to be ten (10) additional days, including witness and hearing preparation, hearing days, motion work and closing briefing, totaling at least $18,000. Due to the contentious and cost escalating practices of opposing counsel, the City Attorney believes the costs could well exceed that estimate and is requesting the City Manager authorize funding up to her full authority. The City Attorney's office will obviously make every effort to minimize actual costs incurred, while ensuring effective representation. Hearing - Officer For significant public safety disciplinary appeals, the City's personnel rules and MOAs require the appeals be heard by an independent third -parry hearing officer selected by the parties through a "strike" process from a list of qualified and available hearing officers provided by State Mediation and Conciliation Services (a division of the PERB Board). While SMCS provides the list of hearing officers free of charge, the costs of the hearing officer's services must be paid entirely by the City because the hearing officer's decision is advisory to the City Council; based on case law, only where the decision is a binding final decision can the employee be required to share in the costs. The hearing officer selected via the strike process in this action, David Cameron, charges $2000 per Further funding for Personnel Disciplinary Appeal Page 3 day of hearing, plus mileage and expenses, as well as costs of preparation of the written findings and recommendation to Council at the conclusion of the hearing at a rate of $350/hr. We have received an interim invoice, not yet paid, and the total charges incurred through the first five days of hearing are just under $12,000. Assuming that all of the currently scheduled hearing days go forward and the matter is completed in those scheduled five days, I would anticipate subsequent invoices would total a similar amount. I would also anticipate two days of decision drafting and review, totaling approximately $4,000. Thus, the City Attorney is requesting authority for payment of the hearing officer charges up to $30,000 to ensure coverage of estimated costs and modest contingencies. Court Reporter and Transcript Services Because the hearing officer's decision is advisory to the Council, who will need to review the complete record in this matter before reaching its final decision, and because significant public safety disciplinary matters decided by councils are so regularly appealed by employees to the courts, it is necessary to have an official record and transcripts of proceedings. Costs of the court reporter and transcripts vary somewhat based on the length of a day's proceedings and the number of transcript volumes resulting. Based on costs to date, the court reporter and transcript fees are averaging between $2,500 and $2,800 per day. The first two days' bills from this vendor were sent to Mr. Palmer's office and paid by Jones & Mayer, with the costs being passed through to the City via the firm's invoicing. We have subsequently requested that the City be billed directly so that we can better distinguish, track and account for the different vendors from whom the City needed to retain services related to this matter. Based on the currently pending billing (three hearing days and transcript costs) and anticipating similar costs for the remaining five hearing days, the City Attorney is requesting that the City Manager authorize payment to this vendor for court reporting services and transcripts and contingencies in an amount not to exceed $28,000. Fiscal Impact In total, costs are anticipated to be approximately $108,000 to cover the three different service vendors /contracts related to this case. The City Attorney previously encumbered $25,000 for attorney's fees and expenses and now requires an additional $83,000 to cover anticipated costs. The City Attorney has reviewed the office's budget and does not have funding sufficient to fund all of these costs. By reallocating funding currently encumbered for personnel investigations, code enforcement and unused litigation funds from a completed matter (Sipple), this office has identified $13,656 that could be used for this purpose, leaving a gap of $69,344 in needed funding. At the request of the City Attorney, the Police and Human Resources Departments have identified within their own budgets $8,000 and $3,344, respectively. Combined, these contributions will cover the $25,000 needed for Jones and Mayer's attorney's fees. Funding sources for the hearing officer ($30,000) and court reporter ($28,000) costs remain undetermined. The City Attorney's office has $8,900 currently budgeted for legal services in the current fiscal year, which could be used toward this matter, but it would exhaust that line item. Staff is proposing to reallocate $58,000 in salary savings from the vacant Police Chief s position to cover the balance of the costs that exceed the amounts that are being reallocated from the departments as described above. Further funding for Personnel Disciplinary Appeal Page 4 Attachments: 1. 2014 10 01 - LSA - Jones and Mayer.pdf 2. 2015 08 - Jones & Mayer - Amendment to Agreement docx 3. 2015 08 13 - Contract w Hearing Officer - Cameron.docx 4. 2015 06 01 - Contract w McDaniel Re orting.docx 5. BAR