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2010-27514 ResoRESOLUTION NO.; 2010-27514 ~ ~ '. i A RESOLUTIOI BEACH, FLOF OCTOBER 1, ; TOWARDS HE. HOUR WITHO DESIGNEE, T CONTRACTS, , NEW LIVING V' N0.2010-3682. J OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI ;IDA, REAFFIRMING NEW LIVING WAGE RATES, EFFECTIVE '010 AS FOLLOWS: ,$10.16 PER HOUR WITH CONTRIBUTIONS ~LTH BENEFITS OF AT LEAST $1.25 PER HOUR, AND $11.41 PER UT BENEFITS; AND AUTHORIZING THE CITY MANAGER OR ~ EXECUTE AMENDMENTS TO ALL COVERED SERVICES ~-S LISTED IN EXHIBIT 1 ATTACHED HERETO, TO REFLECT THE IAGE RATES AND REQUIREMENTS, PURSUANT TO ORDINANCE WHEREAS, at its June 9, 2010 meeting, the Mayor and City Commission adopted Ordinance No. 2010-3682, which amended the City's Living Wage Ordinance (as codified ~; in sections 2-407 thru 2-410 of the Miami Beach City Code); and WHEREAS, effective October 1, 2010, those service contractors as defined in the Ordinance, shall be required to pay all employees who provide services for covered service contracts, the new living wage rates of $10.16/hr. with health benefits of at least $1.25/hr, a ~ d $11.41/hr without benefits; and ~ WHEREAS, all service contractors were notified, in writing, that the City would allow for a proportionate increase (increase to employee's wages to the new living wage rates), plus Federal Insurance Contributions Act (FICA) tax at 6.20%, and Medicare Insurance Contribution Act (MICA) 1.45%; and ~. WHEREAS, the new living wage rates apply to 17 contracts, awarded to 30 contractors which provide the City with general services and employ over 640 employees; and WHEREAS, as a result of the recently adopted rates, which become effective October 1, 2010, the aforementioned contracts must be amended to increase the total contract value proportionately to the proposed rates over the next three (3) years. '~ NOW, THEREFC OF THE CITY OF MIAI authorize the City Mangy follows: $10.16 per hou and $11.41 per hour witl amendments to all coves the new living wage rate: PASSED AND ATTEST:' ~~~F CITY CLERK T:1AG E N DA120101se ptem be r i RE, BE IT RESOLVED BY THE MAYOR AND CITY COMMISSION AI BEACH, FLORIDA, that the Mayor and City Commission hereby ger to reaffirm new living wage rates, effective October 1, 2010 as with contributions towards health benefits of at least $1:25 per hour, gout benefits; and authorize the City Manager or designee, to execute ~d services contracts, as listed in Exhibit 1 attached hereto, to reflect and requirements, pursuant to Ordinance No. 2010-3682. ~IOPTED this aof ~ day of September, 2010. '~ ,, , MAYOR APRR'OVED AS TO FORM & LANGUAGE & FAN EXECUTION ment to Living Wage Contracts -- Reso. L d ~ (l ~ ~Q ty a ate COMMISSION ITEM SUMMARY Condensed Title: A Resolution Reaffirming The New Living Wage Rates Effective October 1, 2010, Pursuant To Living Wage Ordinance No. 2010-3682, And Authorizing The City Manager Or Designee, To Execute Amendments'To All Covered Services Contracts, As Listed In Exhibit 1 Attached Hereto. Kev Intended Outcome Sunnerted: International Center foi -Innovation in Culture, Recreation and Business. Supporting Data (Sur veys, Environmental Scan, etc.): 17% of business responding,feltthst Miami Beach was the best place to run a business, 25% felt that it was an above average place to run a business and 41 %felt that it was an average to run a business. Also, 62% of business respondents would recommend Miami Beach to others as a lace to run a business. Issue: Shall the Ci Commission Ado t the Resolution? Item Summa /Recommendation: At its June 9, 2010 meeting, the Mayor and City Commission passed and adopted Ordinance No. 2010'-3682, which amended the City s Living Wage Ordinance, Sections 2-407 thru 2-410 of the Miami Beach City;Code, herein referred to as the "Ordinance". The current Ordinance applies to 17 contracts, awarded to 31 contractors which provide the City with general services and employ over 640 employees. As a result of the recently adopted Living Wage rates effective October 1, 2010, the aforementioned contracts must be amended to increase the total contract value through adjustments to billing rates equal to the~direct cost to increase employees'-wages to the adjusted Living Wage rate plus FICA and MICA on that increase to the proposed rates over the next three years, and incorporate the requirements set forth in the Ordinance, as it applies to the term of each contract. Attached as Exhibit 1 type of contract. the current Living Wage contracts with the corresponding contractors, separated by The Administration recommends that the Mayor and City Commission adopt the attached Resolution, ,which reaffirms the new living wage rates pursuant to Living Wage Ordinance No:2010-3682, and authorizes the City Manager or designee, to execute amendment to all covered service contracts listed in the attached Exhibit 1. ~ ADOPT THE RESOLUTION. I Advisory Board Recommendation: Financial Information: Source of ! Amount Account Approved Funds: ~ , '2 ;~ 3 OBPI Total Financial Impact Summary: Ci Clerk's Office Le islative Trackin Gus Lopez ext. 6641 Sian-Offs: ~ _. De artmen hec tor Assistant Ci Mana er Ci M na er GL PDW JMG i T:\AGENDA\201 September 20\Consent\Procurement-Amendment to Living Wage Contract m e o Living Wage-Summary.doc m MIAMIBEACH "°E~ opM R'1G EE 9-a01~ m MIAMIBEACH City of Miami Beach, 1700 Convention Center Drive, Miami Beach, Florida 33139, www.miamibeachH.gov COMMISSION MEMORANDUM TO: Mayor Matti Herrera Bower and Members of the City Commission FROM: Jorge M. Gonzalez, City Manager DATE: September 20, 2010 SUBJECT: A RESOLUTION OF THE MAYOR D CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, REAFFIRMING NEW LIVING WAGE RATES, EFFECTIVE OCTOBER 1, 2010 AS FOLLOWS: $10.16 PER HOUR WITH CONTRIBUTIONS TOWARDS HEALTH BENEFITS OF AT LEAST $1, 25 PER HOUR, AND $11.41 PER HOUR WITHOUT BENEFITS; AND AUTHORIZING THE CITY MANAGER OR DESIGNEE, AND THE CITY CLERK TO EXECUTE AMENDMENTS TO ALL COVERED SERVICES CONTRACTS, AS LISTED IN EXHIBIT 1 ATTACHED HERETO, TO REFLECT THE NEW LIVING WAGE RATES, AND REQUIREMENTS, PURSUANT TO ORDINANCE NO. 2010-3682. TIONI RECOMMENDATION Approve the Amendments. BACKGROUND At its June 9, 2010 meeting, the Mayor and City Commission passed and adopted Ordinance No. 2010-3682, which amended the City's Living Wage Ordinance, Sections 2-407 thru 2-410 of the Miami Beach City Code, herein referred to as the "Ordinance". Adopted as part ofd the amendment, effective October 1, 2010, service. contractors as defined in the Ordinance, shall be required to pay all employees, pursuant to Living Wage Ordinance No. 2010-3682, the new Living Wage -rates of $10.16/hr. with health benefits of at least $1.25/hr, and $11.41/hr without benefits. ORDINANCE IMPLEMENTATION As part of implementing the requirements set forth in the Ordinance, the Administration conducted the following: 1. On June 14,E 2010, a letter was issued to all service contractors advising them of the Amendment to the Living Wage Ordinance with a summary of the significant changes and- Living Wage increases. 2. Two (2) training sessions were provided to City of Miami Beach staff, service contractors affected by the Living Wage Ordinance, and prospective bidders which would be subject to the Ordinance. Training sessions were scheduled on two separate dates, June 21 and June 22, 2010. Training was offered to discuss the new requirements of the Ordinance. A Living Wage Guide, a revised Living Wage Certification, and a Notice to be posted at each job site with the new wages were provided to the contractors that attended- the training sessions. Commission Memo Re Living Wage Amendments September 20, 2010 Page 2 of 3 3. On July 26, 2010, service contractors were reminded that all contracts subject to the Living Wage Ordinance would have to be amended to include the new requiremenfis. Contractors were requested to provide a list of employee(s) with their corresponding wage rates and hours for the most recent year of work performed at the City of Miami Beach service contract. Information provided will be used to execute all necessary amendments. ANALYSIS Meetings were conducted with service contractors to discuss the amendment to their contracts. All service contractors were notified via email, of the City's position relative to any increase in cost. All service contractors were informed that the City would allow for a an increase to thei I billing rate equal to the direct cost to increase employees' wages to the adjusted Living Wage rate plus Federal Insurance Contributions Act (FICA) tax at 6.20%, and Medicare Insurance Contribution Act (MICA) 1.45% on that increase. During negotiations;, some contractors wanted to include the following: ^ tax increases (i.e. -Federal Unemployment Tax Act (FUTA), State Une ~ ployment Tax Act (SUTA), Worker's Compensation, and Liability Insurance); ^ increase in overhead and profit; ^ payroll compression (i.e. a similar percentage or dollar per hour increase for. employees who currently earn in excess of the proposed Living Wage rates); and ^ increase to employee benefits, recruiting, drug and screening costs. All of the above requests were denied. Most vendors were agreeable to limit any increase in cost to employees' wages by the new Living Wage rates, plus FICA and MICA. However, the following vendors would not agree to limit their increase to the employees' increased wages, plus FICA and MICA. Therefore, the City will not renew their existing agreements, but will elect to re-bid on an "as needed" basis. Westaff: Westaff is a temporary personnel agency -who has not agreed to limit its cost increase to' employee's wages plus FICA and MICA, but since there are nine (9) other temporary service agencies under contract, there is no need to procure additional temporary service vendors at this time. Everglades Envir~ the additional cost current contract of cost. The propose SUTA, fuel, dump Road. Everglades' reque October 2010, and mental: Everglades Environmental stated that they can not absorb nd would like to propose a $50,000 annual contract to replace their .29,999.75, for services with the Living Wage rates included in the $50,000 annual contract also includes overhead, profit, FUTA, yes, and equipment use for Grounds Maintenance services on Alton was denied, therefore, their contract will terminate at the end of is project will be re-bid. Commission Memo Re Living Wage Amendments September 20, 2010 Page 3 of 3 Security Alliance: Security Alliance stated that they can not accept the proposed price increase because it does not consider the real costs of FUTA, SUTA and Workers' Compensation Insurance that are all directly tied to payroll. For Security Alliance, these 3 factors (FUTA, SUTA and Work Comp) cost them about 6%. However, Security Alliance will pay the security guards the new Living Wage rates. effective October 1, 2010. Security Alliance's contract is on a month-to-month basis until such time that a new contract is awarded. All other contractors have accepted the City's position even though not all costs (i.e.- FUTA, SUTA, Worker's Compensation, etc.) were going to be a "pass through" to the City. CONTRACTS TO BE AMENDED The current- Ordinance applies to 17 contracts, awarded to 30 contractors which provide the City with general services and employ over 640 employees. As a result of the recently adopted Living Wage rates effective October 1, 2010, the aforementioned co ~ tracts must be amended to increase the total contract value through adjustments to billing rates equal to the direct cost to increase employees' wages to the adjusted Living Wage rate plus FICA and MICA on that increase to the proposed rates over the next three years, and incorporate the requirements set forth in the Ordinance, as it applies to the term of each contract. Attached as Exhibit 1 are the current Living Wage contracts with the corresponding contractors, separated by type of contract. . CONCLUSION The Administration recommends that .the Mayor and City Commission adopt the attached Resolution that reaffirms the new living wage rates effective October 1, 2010, and authorizes the City Manager or designee, to execute amendments to all covered service contracts listed in the attached Exhibit 1. JMG/PDW/GL T:\AGENDA\2010\September 20\ConsentlProcurement-Amendment to Living Wage ContractslAmendment to Living Wage Contracts -Memo (1).doc EXHIBIT 1 CITY OF MIAMI BEACH S tFP 22-09110 TEMPORARYPERSONNE~ SERA __ _ _ 1 Al A Em to ment of Miami 2 Union Tem ora Services 3 Creative Staffin ,inc. 4 GDKN 5 Adecco 6 Juristaff, Inc. 7 ADTS 8 Snellin Staffin Services 9 Able Bod Labor tFP 34-05106UNARMED SECl1RITY GUARD S1 10 Security Alliance of Florida __ tFP'17-05f06 IPARKIN~G METER:COLLECTION 11 Standard Parking tFP11-07/08PARKINGCA~HiERS, ATTENDAI~' 12 Impark (Imperial Parking) ~FP 04-x7108; CITYWIDE JANITORIAL SERVICE __ _ _ _ ___ 13 Vista Buildin Maintenance Services 14 Diamond Contract Service 15 Omarcio Cleanin Services tFP 34=08/9 GRQUNDS MAINTENANCE EAU. __ 16 SFM Services 17 Su erior Landsca in 18 Count Bill's 19 Vila & Son Landsca in Cor oration 20 Ever lades Environmental Care, Inc. 21 Elan Lawn TB'°19-98f09 GROUNDS MAINTENANCE >SOU' __ Superior Landscaping TB 2©-09f10 GRaUNDS:MAINTEN~NCE FOR:11 Vila & Son Landscaping Corporation TB:57=08/09:PARKIIUG LOT:GROU:NDS MAINT:I SFM Services T'B08-04l05LANQSCAPE:AAAtNTENANCf: BE1 22 Florida Lawn Services,lnc. 23 Nei hborhood Maintenance, Inc. FE3 33~fl7f0$ HOLIDAY :DECORATIONS 24 Christmas Designers, tnc tFP 20~7I08 MANAGEMENT OF; CON1/ENTIO:i1 25 Global Spectrum tFP 60-08fQ9 COLLECTI4N:AN~>DISPOS~L 4F 26 Choice Environmental Services of Miami, Inc. I'B 10-06f07 ELECTRIC MOTOR :REWIND AND 27 Condo Electric .E CONTRACTS