TO:
Honorable Mayor and Members of the City Council
THROUGH:
Bruce Moe, City Manager
FROM:
George Gabriel, Assistant to the City Manager
SUBJECT:Title
Consideration of a Resolution Approving Amendment No. 6 to the Existing Agreement with Richards, Watson & Gershon to Increase the Monthly Retainer to $37,500 (City Manager Moe).
ADOPT RESOLUTION NO. 24-0031
Body
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RECOMMENDATION:
Staff recommends that the City Council adopt Resolution No. 24-0031 approving Amendment No. 6 to the existing agreement with Richards, Watson & Gershon to increase the monthly retainer amount to $37,500.
FISCAL IMPLICATIONS:
If the amendment with Richards, Watson & Gershon (RWG) is approved, legal retainer fees are projected to increase by $63,689.93 next fiscal year and be incorporated into the Fiscal Year 2024-2025 Operating Budget.
Additionally, future years will be budgeted accordingly as the rates may be adjusted depending on whether there is an increase in the Consumer Price Index (“CPI”), consistent with Amendment No. 4 of the Agreement with RWG.
BACKGROUND:
On September 6, 2011, the City entered into an agreement for City Attorney services with RWG. Since that time, the City and RWG have executed several amendments increasing the scope of legal services, with corresponding fee increases. From 2011 to 2014, the monthly retainer was $19,500. In 2014, the City Council approved Amendment No. 1, which: required RWG personnel to devote 40 hours to office hours and attend Planning Commissions; and increased the monthly retainer to $24,000. In 2021, the Council increased the monthly retainer to $30,000, with annual CPI adjustments, commencing in July 2023, not to exceed 4% without City Council approval. Effective July 1, 2023, the CPI-adjusted monthly retainer is $31,146. For the month of February (latest data available), the Los Angeles-Long Beach-Anaheim CPI is 3.36 % from one year ago. Thus, without this amendment, the monthly retainer would likely increase to $32,192.51, effective July 1, 2024. If approved, there would be no CPI increase in the monthly retainer on July 1, 2024.
DISCUSSION:
The monthly retainer is a “true” retainer, which means that the City currently pays $31,146 each month, regardless of how many hours RWG devotes to general services. Due to increased demand, both RWG’s on-site presence and off-site general services have increased. Three RWG partners-City Attorney Quinn Barrow, David Snow and Lolly Enriquez-are in the office on a regular basis. In January 2024, the City Attorney had 66.50 office hours alone. In addition, partner Jennifer Petrusis, and several other RWG attorneys, have been on-site on an as-needed basis. Including the other off-site services, the retainer represents the highest discount received by the City. In January 2024, the time value at RWG standard rates for services included in the retainer account was $78,848.50.
As noted in the background, consistent with Amendment No. 4 to the agreement with RWG, the monthly retainer shall automatically increase by the percentage change in the Consumer Price Index, with a cap of 4%, which can only be exceeded by a contract amendment approved by the City Council. Should the City Council approve Amendment No. 6, the monthly retainer would not be adjusted due to CPI until July 2025, additional to every year thereafter.
CONCLUSION:
Staff recommends that the City Council adopt Resolution No. 24-0031 approving amendment no. 6 to the existing agreement with Richards, Watson & Gershon to require 50 office hours a month and increase the monthly retainer.
ATTACHMENTS:
1. Resolution No. 24-0031
2. Amendment No. 6 - Richards, Watson & Gershon
3. Agreement and Amendment Nos. 1-5 - Richards, Watson & Gershon