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13-181 Resolution No. 13-181 RESOLUTION AUTHORIZING EXECUTION OF AN AGREEMENT WITH AZAVAR AUDIT SOLUTIONS, INC. FOR UTILITY BILL AUDIT SERVICES BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN, ILLINOIS, that Sean R. Stegall, City Manager, and Kimberly A. Dewis, City Clerk, be and are hereby authorized and directed to execute an Agreement with Azavar Audit Solutions, Inc. on behalf of the City of Elgin for utility bill audit services; a copy of which is attached hereto and made a part hereof by reference. s/ David J. Kaptain David J. Kaptain, Mayor Presented: November 6, 2013 Adopted: November 6, 2013 Omnibus Vote: Yeas: 9 Nays: 0 Attest: s/Kimberly Dewis Kimberly Dewis, City Clerk AGREEMENT November THIS AGREEMENT is made and entered into this 6th day of/ 2013, by and between the CITY OF ELGIN, an Illinois municipal corporation (hereinafter referred to as "CITY") and Azavar Audit Solutions, Inc., an Illinois corporation (hereinafter referred to as "CONSULTANT"). WHEREAS, the CITY desires to engage the CONSULTANT to furnish certain professional services in connection with Request for Proposal Number 12-048B Utility Bill Audit Services (hereinafter referred to as the "PROJECT"); and WHEREAS, the CONSULTANT represents that it has the necessary expertise and experience to furnish such services upon the terms and conditions set forth herein below. NOW, THEREFORE, it is hereby agreed by and between the CITY and the CONSULTANT that the CITY does hereby retain the CONSULTANT for and in consideration of the mutual promises and covenants contained herein, the sufficiency of which is hereby acknowledged to perform the services relating to the PROJECT as described herein, subject to the following terms, conditions and limitations, to wit: 1. SCOPE OF SERVICES A. All work hereunder shall be performed under the direction of the Management Analyst of the CITY, hereinafter referred to as the "DIRECTOR". B. The CONSULTANT shall perform a complete post-payment audit of the CITY's utility payments. As part of the audit, CONSULTANT shall separately audit each utility tax, taxpayer, franchise fee, and utility service fee and expense imposed by or upon the CITY within the CITY's corporate boundaries. A detailed Scope of Services entitled "Implementation Plan/Scope of Services & Technical Proposal" is attached hereto as Attachment A. C. The purpose of each audit is to determine past, present and future taxes, franchise fees, services fees, or any other refunds, monies or revenue owed to the CITY that were not properly attributed to the CITY or were not properly paid or collected, and to determine future taxes, franchise fees, and other monies owed to the CITY not previously counted so that the CITY can collect these past, present, and future monies. Federal and Illinois state law, the CITY's local ordinances and databases, and the franchise agreements and contracts or bills between the CITY and any utility providers are used by CONSULTANT to conduct the audits, and CONSULTANT will present to the CITY in writing during the course of the audits any findings or monies due or potentially due to the CITY for the CITY's review(hereinafter referred to as "Findings"). 2. PROGRESS REPORTS A. A detailed project schedule for the PROJECT is included in Attachment A. Progress will be recorded on the project schedule and submitted monthly as a component of the Status Report described in B below. B. The CONSULTANT will submit to the DIRECTOR monthly a status report keyed to the project schedule. A brief narrative will be provided identifying progress, findings and outstanding issues. 3. WORK PRODUCT All work product prepared by the CONSULTANT pursuant hereto including, but not limited to, reports, plans, designs, calculations, work drawings, studies, photographs, models and recommendations shall be the property of the CITY and shall be delivered to the CITY upon request of the DIRECTOR; provided, however, that the CONSULTANT may retain copies of such work product for its records. CONSULTANT's execution of this Agreement shall constitute CONSULTANT's conveyance and assignment of all right, title and interest, including but not limited to any copyright interest, by the CONSULT ANT to the CITY of all such work product prepared by the CONSULTANT pursuant to this Agreement. The CITY shall have the right either on its own or through such other consultants as determined by the CITY to utilize and/or amend such work product. Any such amendment to such work product shall be at the sole risk of the CITY. Such work product is not intended or represented to be suitable for reuse by the CITY on any extension to the PROJECT or on any other project, and such reuse shall be at the sole risk of the CITY without liability or legal exposure to the CONSULTANT. Nothing in this Agreement grants CITY any access or rights to CONSULTANT's proprietary software and modeling techniques used in connection with CONSULTANT's audits conducted in connection with this Agreement. 4. PAYMENTS TO THE CONSULTANT A. The CITY shall compensate CONSULTANT on a contingency basis. The contingency payment terms are set forth in subparagraphs 4.B and 4.C, below. The CITY shall make periodic payments to CONSULTANT based upon actual progress within thirty(30) days after receipt and approval of an invoice from CONSULTANT. If the CITY negotiates, abates, cancels, amends, or waives, without CONSULTANT's written consent, any tax determination or Findings that were identified by CONSULTANT or by its Audits where such findings were allowed under the law at the time the tax determination or Findings were made, the CITY shall pay to CONSULTANT applicable contingency fees only for those savings and/or recoveries actually received by the CITY based upon said tax determination or Findings at the rates set forth below and for the following twenty-four (24)months. If the CITY later implements during the subsequent twenty-four(24) months any Findings the CITY initially declined based on CONSULTANT's programs or recommendations, including overall utility audits included herein, CONSULTANT will be entitled to its portion of the savings and/or recoveries over the following twenty-four(24) months at the contingency fee rates set forth below. In no event shall CONSULTANT be entitled to any contingency fee under this Agreement based upon any tax determination or Findings unless the CITY actually receives the savings and/or recoveries as set forth below. B. City shall pay CONSULTANT an amount equal to forty-five (45) percent of any new revenues or prospective funds recovered per account or per Provider for twenty-four (24) months following when funds begin to be properly remitted to the CITY. In the event CONSULTANT is able to recover any retroactive funds, any additional savings or revenue increases for any time period, or any credits at any time, the CITY will pay CONSULTANT in an amount equal to forty-five (45) percent of any retroactive funds, savings, and fair market value for any other special consideration or compensation recovered for and/or by the CITY from any audited Provider. All contingency fees paid to CONSULTANT are based upon determinations ofrecovely by CONSULTANT based on Provider data and regulatory findings agreed to by the CITY. All revenue after the subsequent twenty-our (24) month period for each individual account or Provider will accrue to the sole benefit of the CITY. C. As it pertains to CITY utility service bill and cost audits, CITY shall pay CONSULTANT an amount equal to forty-five (45) percent of the prospective savings approved by the CITY for twenty-four (24) months following the date savings per Provider is implemented by CONSULTANT or CITY. In the event CONSULTANT is able to recover any refunds or any credits at any time, CITY will pay CONSULTANT an amount equal to forty-five (45) percent of said refunds or credits. All contingency fees paid to CONSULTANT are based upon determinations of savings by CONSULTANT and agreed to by the CITY. All revenue after the subsequent twenty-four (24) month period for each individual account or Provider will accrue to the sole benefit of the CITY. 5. INVOICES A. The CONSULTANT shall submit invoices in a format approved by the CITY. Progress reports (213 above)will be included with all payment requests. 6. TERMINATION OF AGREEMENT Notwithstanding any other provision hereof, the CITY may terminate this Agreement at any time upon thirty (30) days prior written notice to the CONSULTANT. In the event that this agreement is so terminated, the CONSULTANT shall be paid for all Findings presented to CITY prior to termination, except that reimbursement shall not exceed the amounts set forth under Paragraph 4 above. 7. TERM This Agreement shall become effective as of the date CITY executes this Agreement and is given a notice to proceed and, unless terminated for cause or pursuant to Paragraph 6, shall be deemed concluded on the date the CITY determines that all of the CONSULTANT's work under this Agreement is completed. A determination of completion shall not constitute a waiver of any rights or claims which the CITY or the CONSULTANT may have or thereafter acquire with respect to any term or provision of this Agreement. 8.NOTICE OF CLAIM If the CONSULTANT wishes to make a claim for additional compensation as a result of action taken by the CITY, the CONSULTANT shall give written notice of his claim within thirty (30) days after occurrence of such action. No claim for additional compensation shall be valid unless so made. Any changes in the CONSULTANT's fee shall be valid only to the extent that such changes are included in writing signed by the CITY in the CITY'S sole discretion, and the CONSULTANT. Regardless of the decision of the DIRECTOR relative to a claim submitted by the CONSULTANT, all work required under this Agreement as determined by the DIRECTOR shall proceed without interruption. 9. BREACH OF CONTRACT If either party violates or breaches any term of this Agreement, such violation or breach shall be deemed to constitute a default and the other party has the right to seek such administrative, contractual or legal remedies as may be suitable to the violation or breach; and, in addition, if either party, by reason of any default, fails within fifteen (15) days after notice thereof by the other party to comply with the conditions of the Agreement, the other party may terminate this Agreement. Notwithstanding the foregoing, or anything else to the contrary in this Agreement, with the sole exception of an action to recover the monies the CITY has agreed to pay to the CONSULTANT pursuant to Paragraph 4 hereof, no action shall be commenced by the CONSULTANT against the CITY for monetary damages. CONSULTANT hereby further waives any and all claims or rights to interest on money claimed to be due pursuant to this Agreement, and waives any and all such rights to interest which it claims it may otherwise be entitled pursuant to law, including, but not limited to, the Local Government Prompt Payment Act (50 ILCS 50111, et seq), as amended, or the Illinois Interest Act (815 ILCS 205/1, et seq.), as amended. The parties hereto further agree that any action by the CONSULTANT arising out of this Agreement must be filed within one year of the date the alleged cause of action arose or the same will be time-barred. The provisions of this paragraph shall survive any expiration, completion and/or termination of this Agreement. 10. INDEMNIFICATION To the fullest extent permitted by law, CONSULTANT agrees to and shall indemnify, defend and hold harmless the CITY, its officers, employees, agents, boards and commissions from and against any and all claims, suits,judgments, costs, attorneys fees, damages or other relief, including, but not limited to, workers' compensation claims, in any way resulting from or arising out of negligent actions or omissions of the CONSULTANT in connection herewith, including negligence or omissions of employees or agents of the CONSULTANT arising out of the performance of this Agreement. In the event of any action against the CITY, its officers, employees, agents, boards or commissions, covered by the foregoing duty to indemnify, defend and hold harmless such action shall be defended by legal counsel of the CITY's choosing. The provisions of this paragraph shall survive any expiration, completion and/or termination of this Agreement. 11. NO PERSONAL LIABILITY No official, director, officer, agent or employee of the CITY shall be charged personally or held contractually liable under any term or provision of this Agreement or because of their execution, approval or attempted execution of this Agreement. 12. INSURANCE A. Comprehensive Liability. The CONSULTANT shall provide, pay for and maintain in effect, during the term of this Agreement, a policy of comprehensive general liability insurance with limits of at least $1,000,000 aggregate for bodily injury and $1,000,000 aggregate for property damage. The CONSULTANT shall deliver to the DIRECTOR a Certificate of Insurance naming the CITY as additional insured. The policy shall not be modified or terminated without thirty (30) days prior written notice to the DIRECTOR. The Certificate of Insurance shall include the contractual obligation assumed by the CONSULTANT under Paragraph 10 entitled "Indemnification". This insurance shall be primary and non-contributory to any other insurance or self insurance programs afforded to the CITY. There shall be no endorsement or modification of this insurance to make it excess over other available insurance. B. Comprehensive Automobile Liability. Comprehensive Automobile Liability Insurance covering all owned, non-owned and hired motor vehicles with limits of not less than $500,000 per occurrence for bodily injury and/or property damage. C. Combined Single Limit Policy. The requirements for insurance coverage for the general liability and auto exposures may be met with a combined single limit of$1,000,000 per occurrence subject to a $1,000,000 aggregate. D. Professional Liability. The CONSULTANT shall carry CONSULTANT's Professional Liability Insurance covering claims resulting from error, omissions or negligent acts with a combined single limit of not less than $1,000,000 per claim. A Certificate of Insurance shall be submitted to the DIRECTOR as evidence of insurance protection. The policy shall not be modified or terminated without thirty (30) days prior written notice to the DIRECTOR. 13. INTENTIONALLY OMITTED 14.NONDISCRIMINATION In all hiring or employment made possible or resulting from this Agreement, there shall be no discrimination against any employee or applicant for employment because of sex, age, race, color, creed, national origin, marital status, of the presence of any sensory, mental or physical handicap, unless based upon a bona fide occupational qualification, and this requirement shall apply to, but not be limited to, the following: employment advertising, layoff or termination, rates of pay or other forms of compensation and selection for training, including apprenticeship. No person shall be denied or subjected to discrimination in receipt of the benefit of any services or activities made possible by or resulting from this Agreement on the grounds of sex, race, color, creed, national origin, age except minimum age and retirement provisions, marital status or the presence of any sensory, mental or physical handicap. Any violation of this provision shall be considered a violation of a material provision of this Agreement and shall be grounds for cancellation, termination or suspension, in whole or in part, of the Agreement by the CITY. 15.ASSIGNMENT AND SUCCESSORS This Agreement and each and every portion thereof shall be binding upon the successors and the assigns of the parties hereto; provided, however, that no assignment shall be made without the prior written consent of the CITY. 16. DELEGATIONS AND SUBCONTRACTORS Any assignment, delegation or subcontracting shall be subject to all the terms, conditions and other provisions of this Agreement and the CONSULT ANT shall remain liable to the CITY with respect to each and every item, condition and other provision hereof to the same extent that the CONSULTANT would have been obligated if it had done the work itself and no assignment, delegation or subcontract had been made. 17. NO CO-PARTNERSHIP OR AGENCY CITY agrees to execute authorizations requested in writing by CONSULTANT necessary for CONSULTANT to provide the services described in the Scope of Services and elsewhere in this Agreement. This Agreement shall not be construed so as to create a partnership, joint venture, employment or other agency relationship between the parties hereto. 18. SEVERABILITY The parties intend and agreed that, if any paragraph, sub-paragraph, phrase, clause or other provision of this Agreement, or any portion thereof, shall be held to be void or otherwise unenforceable, all other portions of this Agreement shall remain in full force and effect. 19. HEADINGS The headings of the several paragraphs of this Agreement are inserted only as a matter of convenience and for reference and in no way are they intended to define, limit or describe the scope of intent of any provision of this Agreement, nor shall they be construed to affect in any manner the terms and provisions hereof or the interpretation or construction thereof. 20. MODIFICATION OR AMENDMENT This Agreement and its attachments constitutes the entire Agreement of the parties on the subject matter hereof and may not be changed, modified, discharged or extended except by written amendment duly executed by the parties. Each party agrees that no representations or warranties shall be binding upon the other party unless expressed in writing herein or in a duly executed amendment hereof, or change order as herein provided. 21. APPLICABLE LAW This Agreement shall be deemed to have been made in, and shall be construed in accordance with the laws of the State of Illinois. Venue for the resolution of any disputes or the enforcement of any rights pursuant to this Agreement shall be in the Circuit Court of Kane County, Illinois. 22. NEWS RELEASES The CONSULTANT may not issue any news releases without prior approval from the DIRECTOR, nor will the CONSULTANT make public proposals developed under this Agreement without prior written approval from the DIRECTOR prior to said documentation becoming matters of public record. 23. COOPERATION WITH OTHER CONSULTANTS The CONSULTANT shall cooperate with any other consultants in the CITY'S employ or any work associated with the PROJECT. 24. INTERFERENCE WITH PUBLIC CONTRACTING The CONSULTANT certifies hereby that it is not barred from bidding on this contract as a result of a violation of 720 ILCS 5/33E et seq. or any similar state or federal statute regarding bid rigging. 25. SEXUAL HARASSMENT As a condition of this contract, the CONSULTANT shall have written sexual harassment policies that include, at a minimum, the following information: A. the illegality of sexual harassment; B. the definition of sexual harassment under state law; C. a description of sexual harassment,utilizing examples; D. the vendor's internal complaint process including penalties; E. the legal recourse, investigative and complaint process available through the Illinois Department of Human Rights, and the Illinois Human Rights Commission; F. directions on how to contact the department and commission; G. protection against retaliation as provided by Section 6-101 of the Human Rights Act. A copy of the policies shall be provided by CONSULTANT to the Department of Human Rights upon request 775 ILCS 5/2-105. 26. SUBSTANCE ABUSE PROGRAM. As a condition of this agreement, CONSULTANT shall have in place a written substance abuse prevention program which meets or exceeds the program requirements in the Substance Abuse Prevention Public Works Project Act at 8201LCS 265/1 et seq. A copy of such policy shall be provided to the City's Assistant City Manager prior to the entry into and execution of this agreement. 27. WRITTEN COMMUNICATIONS All recommendations and other communications by the CONSULTANT to the DIRECTOR and to other participants which may affect cost or time of completion shall be made or confirmed in writing. The DIRECTOR may also require other recommendations and communications by the CONSULTANT be made or confirmed in writing. 28. NOTICES All notices, reports and documents required under this Agreement shall be in writing and shall be mailed by First Class Mail,postage prepaid, addressed as follows: A. As to the CITY: William Cogley Corporation Counsel Aaron Cosentino Management Analyst City of Elgin 150 Dexter Court Elgin, Illinois 60120-5555 B. As to the CONSULTANT: Jason Perry President, Azavar Audit Solutions 234 South Wabash Avenue, Sixth Floor Chicago, Illinois 60604 29. COMPLIANCE WITH LAWS Notwithstanding any other provision of this AGREEMENT it is expressly agreed and understood that in connection with the performance of this AGREEMENT that the CONSULTANT shall comply with all applicable federal, state, city and other requirements of law, including, but not limited to, any applicable requirements regarding prevailing wages, minimum wage, workplace safety and legal status of employees. Without limiting the foregoing, CONSULTANT hereby certifies, represents and warrants to the CITY that all CONSULTANT's employees and/or agents who will be providing products and/or services with respect to this AGREEMENT shall be legal residents of the United States. CONSULTANT shall also at its expense secure all permits and licenses, pay all charges and fees and give all notices necessary and incident to the due and lawful prosecution of the work, and/or the products and/or services to be provided for in this AGREEMENT. The CITY shall have the right to audit any records in the possession or control of the CONSULTANT to determine CONSULTANT's compliance with the provisions of this paragraph. In the event the CITY proceeds with such an audit the CONSULTANT shall make available to the CITY the CONSULTANT's relevant records at no cost to the CITY. CONSULTANT shall pay any and all costs associated.with any such audit. IN WITNESS WHEREOF, the parties hereto have entered into and executed this agreement effective as of the date and year first written above. CITY OF ELGIN: C U T NT By: K - By: I Sean StegWf, City Manager I Name/P t: J Attest: Aa /)U, Title: r z� City Clerk r ATTACHMENT A SCOPE OF SERVICES s ' City of Elgin, Illinois Azavar Audit Solutions, Inc. RFP No. 12-048B Utility Bill Audit Services 2013 5—Implementation Plan Scope of Services &Technical Proposal Azavar Audit Solutions will provide the City of Elgin a complete post payment utility audit program on a fully contingent fee basis including reviewing of utility bills for refund and future savings opportunities. This RFP response contains Azavar Audit Solutions'complete proposal for all services requested by the City of Elgin Utility Bill Audit Services RFP Number 12-048B. The Azavar Audit Solutions proposed City of Elgin utility audit program covers all departments and facilities served by the City of Elgin. The goal of the City of Elgin utility audit program is to reduce energy and telecommunication costs through review of the City's utility bills and to maximize refunds and future savings through recommendations to the City to reduce utility billings for inactive facilities. Azavar Audit Solutions will identify and negotiate refunds with suppliers on behalf of the City and will indentify ongoing savings and opportunities which will be implemented by Azavar Audit Solutions on behalf of the City upon authorization by the City. inclusive of Azavar Audit Solutions complete and comprehensive utility audit program for Elgin,we will: 1. Audit billings for errors on utility usage, application of rates and/or riders; meter, transformer, relay or other miscellaneous utility charges. Azavar Audit Solutions will audit all contracts with existing Providers,utility invoices paid by the City,or free service received by the City for utility services including, but not limited to,the following Providers ("Providers"): L Direct Energy ii. ComEd iii. Nicor iv. Nextel 2. Where it appears that the City is due a refund, credit and/or change in the current bundled rate or rider schedule, Azavar Audit Solutions will prepare all necessary documentation to remove prior overcharges and obtain refunds and or credits for such overcharges. 3. Conduct negotiations with the City's utility suppliers as the City's authorized agent. All Contractor negotiations with the City's utility suppliers will be subject to the City's written authorization and approval. March 7, 2013 Page 14 Q Azavar Audit Solutions Inc. City of Elgin, Illinois Azavar Audit Solutions, Inc. RFP No. 12-048B -Utility Bill Audit Services 2013 4. Propose and describe strategic opportunities which may recover future monies for the City and/or reduce utility/energy costs. Azavar Audit Solutions' Plan of Action to successfully achieve the above scope is set forth below. The Azavar Audit Solutions project manager will work with the City to schedule each audit and necessary audit activities so as to be both convenient for City staff and undisruptive of the City's day-to-day business. Regarding timing and scheduling,the Azavar project manager will prioritize audit activities based on the availability of resources,the responsiveness of utility Providers,the availability of City staff and access to data, and based on the size of specific recoveries at that time. The project manager will administer the Azavar audit management platform for the City and the team of audit professionals during the course of the project. The project manager will also provide regular reports to the City. To achieve the City's goals and fulfill the scope of services above,Azavar Audit Solutions and the Azavar Expert Consultants Grou pTIA subcontractor members will follow the below project plan with input from the City. March 7, 2013 Page 15 C Azavar Audit Solutions Inc, 1 City of Elgin, Illinois Azavar Audit Solutions, Inc. RFP No. 12-0488 Utility Bill Audit Services 2013 i City of Elgin Post Payment Utility Audit Comprehensive Work Plan Stage 1—Audit Kickoff& Initial Review Estimated Timeframe: 30 to 60 days from kickoff meeting. a) Gather all necessary data, documentation, and information from E the City by audit and Provider(for invoices paid after the latest 2 + months). I b) Conduct on-site document collection of City billing records as necessary. c) Conduct on-site kickoff meetings and interviews with appropriate City staff. d) Send audit notices to Providers. e) Conduct initial review of billings and contracts for preliminary errors that can be submitted to Providers. MOTE: At any point during the course of the audit when an overcharge can be proven, a claim will be filed. Claims may be filed at any stage. For many audits, claims are filed early in the audit process for errors verified during the Initial Review with additional claims submitted as they are identified. In some cases,the entire refund is secured at the end of the process, The date that a claim for refund is filed is dependent upon what is discovered in the City's bills. In each case, the City will receive copies of all claims. Azavar Audit Solutions will persist until the City has received the proper recovery. Stage 2—Data Entry Review and Analysis i Estimated Timeframe: 60 days following Stage 1. a) Assemble and aggregate information. b) Compile databases of natural gas and electric billings and services and model rate analysis. c) Organize documents for easy access and future compilation to quickly produce when errors are identified. Stage 3—Provider Documentation Due Diligence I Estimated Timeframe: Varies by provider. Ii i March 7, 2013 Page 16 © Azavar Audit Solutions Inc. City of Elgin, Illinois Azavar Audit Solutions, Inc. RFP No. 12-048B Utility Bill Audit Services 2013 f a) Obtain all Provider rates and tariff information (if not already on file) and request customer files including historical billing and usage data from Providers. b) Enter data as appropriate into each utility analysis system. Stage 4—Analysis Estimated Timeframe: 90 to 180 days following Stage 3 data is received. a) Compare to contracts,tariffs, adjustments b) Analyze paid invoices for refunds and cost savings opportunities against specialized and proprietary metrics determined by Azavar Audit Solutions and members of the Azavar Expert Consultants Group" c) identify and investigate potential errors and trouble accounts or facilities,which may include, but are not limited to, issues listed below in the Findings section. Each area will be reviewed with the City by Azavar Audit Solutions staff and an expert from the Azavar Expert Consultants Group" Stages—Acquisition of Supplemental Information and Client Review Estimated Timeframe: Varies by provider and City staff availability. a) Consult with the City and/or Providers regarding any facilities or accounts where verification of service characteristics is needed in order to determine billing accuracy and cost savings possibilities. b) Prepare and present any preliminary Findings to date as well as questions to the City. c) Decide in accordance with the City whether to move forward with future cost savings opportunities identified by facility to date and review direction of work to be completed. Stage 6—Implementation and Billing Corrections Estimated Timeframe: Normally ranges 30 to 180 days following Stage S but can be substantially longer for larger claims. a) Submit refund claims with documentation and communicate with Providers to accomplish corrections and refunds of verified errors. b) Submit requests to utility Providers for City approved account I changes that will reduce future City expenses. March 7, 2013 Page 17 d Azavar Audit Solutions Inc. City of Elgin, Illinois Azavar Audit Solutions, Inc. RFP No. 12-0486 Utility Bill Audit Services 2013 c) Verify that implemented refunds and recommendations are billed correctly to City by Provider. Stage 7—Field Work(where applicable) Estimated Timeframe: 30 to 90 days after completion of Stage 4. i a) For accounts requiring on-site inspection to determine billing, I metering, or equipment accuracy(based on the Provider), Azavar Audit Solutions and members of the Azavar Expert Consultants Group'" will make arrangements with the City and appropriate departments to perform field work to view meters,transformers, outdoor lighting facilities, and any other equipment or facilities where operational characteristics play a role in the monthly Provider invoice or City expense. b) As it pertains to street light verification,this service is performed by a combination of manual and electronic analysis. A randomly generated statistically significant sampling is obtained and on-site work verifies up to 18 different factors that make up the street light bill. This stage is done concurrently with the in-depth analysis and may take several hundred hours of analysis,depending on number of lights, and errors found. I Stage 8—Additional Refund Claims and Rate Savings Recommendations Estimated Timeframe: See timeframe for Stage 6, Implementation. a) Submit additional refund claims (if needed) with documentation and communicate with Providers to accomplish corrections and refunds of verified errors. E b) Submit requests to utility Providers for additionally identified, City approved account changes that will reduce future City expenses. c) Verify that implemented refunds and recommendations are billed correctly to the City by Provider. Stage 9—Final Report ; E Estimated Timeframe: 30 to 60 days following resolution of all claims. a) Summarize refunds,corrected account errors, and future Provider savings approved by the City and funds returned to the City by i Azavar Audit Solutions. Final reports will be delivered by Provider, I j and when appropriate, by City department. March 7, 2013 Page 18 © Azavar Audit Solutions Inc. —-–------------ ----------------------------- .......--------—------- ---------- City of Elgin, Illinois Azavar Audit Solutions, Inc. RFP No. 12-048B Utility Bill Audit Services 2013 NOTE: the project time table presented is predicated on the assumption that Providers will produce documents, process refunds, and implement account changes approved by the City in a timely fashion. To a large extent, Provider responsiveness is not under the control of Azavar Audit Solutions and thus Audit timelines are set at the discretion of Azavar. Based on Azavar Audit Solutions' extensive utility auditing experience,the project manager will manage the process such that regular reports and opportunities are being presented to the City. Azavar Audit Solutions believes that the City's audit will require at least 24 months. March 7, 2013 Page 19 (D Azavar Audit Solutions Inc. City of Elgin, Illinois Azavar Audit Solutions, Inc. RFP No. 12-048B Utility Bill Audit Services 2013 City of Elgin Audit— Findings in Electric,Thermal Energy and Telecommunication During the course of the audit, a variety of types of refunds and future cost savings Findings ("Findings")may be obtained for the City by Azavar Audit Solutions. The types of potential reasons for errors or savings vary by Provider, which may include, but are not limited to,the issues bulleted below. Each area will be reviewed with the City by Azavar Audit Solutions staff M and an expert from the Azavar Expert Consultants_ Group'": Findings,such that the documentation necessary to substantiate the Finding, may be made and refunds or credits may be pursued at any time by Azavar Audit Solutions for existing contracts between a Provider and the City due to a number of types of Provider errors or issues that may include, but are not limited to: latvii Gas Etectricity Tele ommunic tons • Errors between • Lighting and • Equipment and transaction confirms signaling inventory maintenance charges and contracts and evaluation • Line inventory and • Stated margins �• Meter read errors verification of all • Transportation / • Rates not in charges Storage Errors compliance with • Data Circuit/Line j • Price slippage contractual terms review • Cash-outs o Charges for services • Voice Traffic studies • Meter read errors not being used or ® Toll call analysis and ! • Rates not in otherwise not unauthorized calls compliance with needed • Analysis of local contractual terms • Meter and service vendor (• Charges for services equipment alternatives not being used or malfunctions/Meter • Analysis of cellular otherwise not consolidation vendors and services needed opportunities • Internet and data line • Meter and • Clerical error review equipment • Incorrect factors • Yellow page billing malfunctions/Meter • Tax,tariffs and analysis consolidation surcharges • Tariffs and surcharges opportunities • Error detection • Contract verification f • Clerical error (errors in initial i • Franchise agreement I • Incorrect factors account setup, meter violationsf fill • Tax,tariffs and multiplier, etc.) # • Ordinance surcharges • Optimization of rate consideration ® Optimization of rate schedules deficiencies t schedules • Verification of +) • Verification of demand charges and I March 7, 2013 Page 20 0 Azavar Audit Solutions Inc. i__..__ ___ ._. _ _ _ _ ____ __. .......... --------------------- City of Elgin, Illinois Azavar Audit Solutions, Inc. REP No. 12-048B Utility Bill Audit Services 2013 ............ I demand charges and contracts contracts * Franchise agreement] Franchise agreement ii violationst violationst I® Ordinance Ordinance consideration consideration deficienciest cleficienciest tAny benefit the County receives from any Provider for any prIvileye including use of fights- of-Way. The following are examples of the types of cost savings Findings that may be recommended by Azavar Audit Solutions and experts from the Azavar Expert Consultants Group" and achieved by the City can include but are not limited to: a) Ensuring the City is receiving the equipment and services for which it is paying b) Ensuring the City is using the equipment and services for which it is paying including various meter consolidation opportunities . c) Ensuring the City is paying the correct price by contract,tariff, regulatory charges d) Ensuring that the City is provided with more cost effective options and alternatives where appropriate e) Verification of demand charges and contracts f) Verification that the City is paying only for energy services at active facilities, Any Finding made by Azavar Audit Solutions that will result in cost savings and/or future benefit to the City will be presented to the City in writing and will only be implemented upon the written approval and authorization of the City. As part of Azavar Audit Solutions' program,the City reserves the right to reject any future savings recommendation made by Azavar Audit Solutions without obligation. March 7, 2013 Page 21 0 Azavar Audit Solutions Inc. City of Elgin, Illinois Azavar Audit Solutions, Inc. I I : RFP No. 12-0486 Utility Bill Audit Services 2013 t 7—Cost Proposal Provided in a separately sealed package labeled "Price Proposal for Utility Billing Audit" as required in the City's RFP. I 8—Attachments (Completed Forms & Executed Documents) Included with this proposal are the following attachments of completed and executed forms j and other documents. The group of attachments follows this page and each set of attachments documents are separated. i ATTACHMENT 1. ATTACHMENT 1 : Company References/Client Profile a) Rockford, IL b) Las Vegas, NV c) New Orleans, LA s 2. ATTACHMENT 2: Illinois Secretary of State Corporate Verification 3. ATTACHMENT 3: Completed City of Elgin, Illinois Certification Requirements 4. ATTACHMENT 4: Completed City of Elgin, Illinois Tax/Collusion/Debarment/Prevailing Wage/Legal Status of Employees Affidavit 5. ATTACHMENT 5: Completed City of Elgin, Illinois Bidder's Employee Utilization Form 6. ATTACHMENT 6: Completed City of Elgin, Illinois Sexual Harassment—Rolicies and Programs Form 7. ATTACHMENT 7: Azavar Audit Solutions Proposed Contingent Fee Agreement F March 7, 2013 Page 22 O Azavar Audit Solutions Inc.