HomeMy WebLinkAboutRes1995-140
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Sponsored by: Garzini
CITY OF SEWARD, ALASKA
RESOLUTION NO. 95-140
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF SEWARD, ALASKA, AWARDING A CONTRACT TO
KPMG PEAT MARWICK FOR THE PURCHASE OF
SOFTWARE AND DEVELOPMENT OF AN INDIRECT
COST ALLOCATION PLAN
WHEREAS, during the FY 1996 budget process, the City Council directed the Finance
Department to pursue options for the development of an indirect cost allocation plan to be used in
determining the administrative fees charged to enterprise funds and capital projects; and
WHEREAS, in the past, the percentage charged to the enterprise funds and capital projects
for these indirect costs (administrative fees) has been determined by a third-party consultant; and
WHEREAS, the latest indirect cost allocation plan for the enterprise funds was developed
in 1990, and the latest indirect cost allocation plan for capital projects was reviewed and set in 1984;
and
WHEREAS, the State of Alaska has disallowed the 12.2% rate the city has been charging
for capital projects and will allow an overhead rate of not more than 10% unless the City can justify
a higher rate; and
WHEREAS, the State of Alaska has set a combined PIL T and administrative overhead rate
in the new Harbor Management Agreement at 12% (8% PIL T and 4% administrative overhead) and
will not allow a higher rate unless the City can justify an increase; and
WHEREAS, any significant reduction in administrative fees has a direct and substantial
impact on the City's general fund; and
WHEREAS, KPMG Peat Marwick has proposed to provide the City with an in-house
software program with a cost allocation plan that will develop administrative fees for the enterprise
funds, the indirect overhead costs for the Harbor Enterprise Fund divisions, the indirect overhead
rate charged by the Electric Enterprise Fund to customers and an indirect overhead plan for capital
projects; and
WHEREAS, the total cost for development of the software and staff training to use the
software is $39,500; and
WHEREAS, the City Code provides an exemption from the standard bid process for the
procurement of professional services; and
CITY OF SEWARD, ALASKA
RESOLUTION NO. 95-140
WHEREAS, there appears to be only three firms nationwide capable of providing this
service to the City; and
WHEREAS, of those fIrms providing the service, only KPMG Peat Marwick has an Alaska
office;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF SEWARD, ALASKA, that:
Section 1. The City Manager is hereby authorized to enter into a contract in the amount of
$39,500 with KPMG Peat Marwick to provide software for cost determination models, to provide
staff training in the use of the software, and to develop an indirect cost allocation plan for the City's
various operations.
Section 2. This resolution shall take effect immediately upon its adoption.
PASSED AND APPROVED by the City Council of the city of Seward, Alaska, this 27th
day of November, 1995.
THE CITY OF SEWARD, ALASKA
AYES:
NOES:
ABSENT:
ABSTAIN:
Anderson, Bencardino, Crane, Deeter, Keil, King, Sieminski
None
None
None
ATTEST:
(City Seal)
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