2003-25398 Reso
RESOLUTION NO. 2003-25398
A RESOLUTION OF THE MAYOR AND THE CITY COMMISSION OF THE
CITY OF MIAMI BEACH, FLORIDA ACCEPTING THE RECOMMENDATION
OF THE CITY MANAGER PERTAINING TO THE RANKING OF PROPOSALS
RECEIVED PURSUANT TO REQUEST FOR PROPOSALS (RFP) NO 58-
02/03, FOR PROVIDING AUDITS OF RESORT TAXES AND INTERNAL
AUDITS OF NON-PROFIT ORGANIZATIONS; AUTHORIZING THE
ADMINISTRATION TO ENTER INTO NEGOTIATIONS AND CONTRACTS
FOR A ONE-YEAR CONTRACT, WITH TWO ONE-YEAR OPTIONS TO
RENEW, WITH THE TOP RANKED THREE FIRMS (URBACH KAHN &
WERLlN; BEVERL YYOUNG; AND RODRIQUEZ TRUEBA& COMPANY) FOR
AUDITS OF RESORT TAXES; AND THE TOP RANKED TWO FIRMS
(SANSON KLINE JACOMINO & COMPANY AND URBACH KAHN & WERLlN)
FOR AUDITS OF NON-PROFIT ORGANIZATIONS; SHOULD THE
ADMINISTRATION NOT BE ABLE TO NEGOTIATE WITH THE TOP FIRMS,
AUTHORIZING THE ADMINISTRATION TO NEGOTIATE WITH THE NEXT
FIRMS RANKED IN ORDER OF SELECTION, AND AS SET FORTH IN THIS
RESOLUTION.
WHEREAS, on February 5,2003, the Mayor and City Commission
authorized the Administration to issue a request for proposals for the provision of
Auditing Resort Taxes for a one-year period, and to extend the current existing
agreements with Beverly Young and The Bookkeepers, on a month-to-month
basis, until conclusion of the competitive process and the negotiation and
execution of new agreements were completed; and
WHEREAS, to satisfy the City Commission's desire to audit non-
profit organizations receiving funding through the City, the Administration
subsequently expanded the scope of the RFP to include a provision for audits of
non-profit organizations; and
WHEREAS, on July 30, 2003, RFP No. 58 02/03 (the RFP) was
issued, and six responsive proposals were received; and
WHEREAS, on October 21, 2003, an evaluation committee
appointed by the City Manager convened and evaluated the proposals and
ranked the firms according to the criteria listed in the RFP; and
WHEREAS, the evaluation committee ranked the following firms
for audits of resort taxes: (1) Urbach Kahn & Werlin; (2) Beverly Young; (3)
Rodriquez Trueba & Company; (4) The Bookkeepers; and (5) Sanson Kline
Jacomine and Company; and
WHEREAS, the evaluation committee ranked the following firms
for audits of non-profit organizations: (1) Sanson Kline Jacomine and Company;
(2) Urbach Kahn & Werlin; (3) Rodriquez Trueba & Company; and (4) Forshee &
Lockwood.
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR
AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the
Mayor and City Commission hereby accept the City Manager's recommendation
pertaining to the ranking of proposals received pursuant to RFP No. 58-02/03,
and authorize the Administration to enter into negotiations and contracts for a
one-year period, with two one-year options to renew, with the top ranked three
firms (Urbach Kahn & Werlin; Beverly Young; and Rodriquez Trueba &
Company) for audits of resort taxes; and the top ranked two firms (Sanson,
Kline, Jacomino & Company and Urbach Kahn & Werlin) for audits of non-profit
organizations; in both cases, if one firm cannot come to an agreement, then the
other firm or firms, in order of ranking, may be approached for negotiation and
contract.
PASSED and ADOPTED this 25th
e ber, 2003.
MAYOR
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CITY CLERK
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APPROVED NJ TO
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Date
CITY OF MIAMI BEACH
COMMISSION ITEM SUMMARY
m
Condensed Title:
A resolution accepting the recommendation of the City Manager pertaining to the ranking of proposals
received pursuant RFP 58-02/03 for the provision of auditing services for resort taxes and audits of non-
profit organizations; and authorizing the Administration to enter into negotiations and contracts with the top
rank firms for a one year contract with two one-year options to renew.
Issue:
Shall the Commission authorize the Administration to enter into negotiations and contracts with the top
three firms of Urbach Kahn & Werlin, Beverly Young, and Rodriquez Truba & Company for audits of resort
taxes and with the top two firms of Sanson Kline Jacomino and Urbach Kahn & Werlin for internal audits of
non-profit organizations?
Item Summary/Recommendation:
Audits of business collecting City resort taxes have been performed by the City's field agents and
supplemented by contracting out audits to outside firms. It is recommended that the City continues to
contract with outside firms to assist in audits of resort taxes. In addition, it is recommended to contract with
outside firms to assist the internal audit department with audits of non-profit agencies receiving monies
through the city.
ADOPT THE RESOLUTION
Advisory Board Recommendation:
On January 15, 2003, the City Finance and Citywide Projects Committee approved the continued usage of
outside contractors to supplement audit coverage for resort taxes.
Financiallnfonnation:
Source of
Funds:
$10,000
160.0330.000312 (Professional Services
Resort Tax Fund
011.0330.000312 (Professional Services-
General Fund
D
Finance Dep!.
City Clerk's Office Legislative Tracking:
I
AGENDA ITEM e 7 E.
DATE /1~J--03
CITY OF MIAMI BEACH
CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139
www.ci.miami-beach.fl.us
To:
From:
Subject:
COMMISSION MEMORANDUM
Mayor David Dermer and
Members of the City Commission
Jorge M. Gonzalez \~
City Manager U
Date: November 25, 2003
A RESOLUTION OF THE MAYOR AND THE CITY COMMISSION OF THE
CITY OF MIAMI BEACH, FLORIDA ACCEPTING THE
RECOMMENDATION OF THE CITY MANAGER PERTAINING TO THE
RANKING OF PROPOSALS RECEIVED PURSUANT TO REQUEST FOR
PROPOSALS (RFP) N058-02/03, FOR PROVIDING AUDITS OF RESORT
TAXES AND INTERNAL AUDITS OF NON-PROFIT ORGANIZATIONS;
AUTHORIZING THE ADMINISTRATION TO ENTER INTO NEGOTIATIONS
AND CONTRACTS FOR A ONE-YEAR CONTRACT, WITH TWO ONE.
YEAR OPTIONS TO RENEW, WITH THE TOP THREE FIRMS (URBACH
KAHN & WERLlN; BEVERLY YOUNG; AND RODRIQUEZ TRUEBA &
COMPANY) FOR AUDITS OF RESORT TAXES, AND THE TOP TWO
FIRMS (SANSON KLINE JACOMINO & COMPANY AND URBACH KAHN
& WERLlN) FOR AUDITS OF NON-PROFIT ORGANIZATIONS; SHOULD
THE ADMINISTRATION NOT BE ABLE TO NEGOTIATE WITH THE TOP
FIRMS, AUTHORIZING THE ADMINISTRATION TO NEGOTIATE WITH
THE NEXT FIRMS RANKED IN ORDER OF SELECTION, AS SET FORTH
IN THIS ITEM.
ADMINISTRATION RECOMMENDATION
Adopt the Resolution.
ANALYSIS
The City of Miami Beach charges a resort tax of three percent on revenues generated by
the sale of rooms and two percent of revenues from food and beverage earned within the
City. Businesses are required to register with the City to collect and remit taxes. It is
projected that $25.6 million in resort taxes will be collected in fiscal year 2004. As of
October 1, 2003, there were 1,959 businesses registered to collect resort taxes. Of the
total registered businesses, 665 are reporting taxes to the City on a monthly basis and 6
are reporting taxes on a quarterly basis. These businesses consist of hotels, restaurants,
nightclubs, and bars. The balance of registered businesses (1,288) represents apartments
required to report on an annual basis to the City.
The City employs field agents to audit these businesses. In an effort to expand audit
November 25, 2003
Commission Memorandum
RFP - Audit of Resort Taxes and Non-Profit Organizations
Page 2 of 5
coverage, the City entered into agreements with three independent contractors in October
of 1994 to audit the records of these businesses. On January 12, 2000, the Commission
adopted a resolution accepting the ranking of responses received and authorized the
administration to negotiate and enter into contracts for these services. Two contractors
were awarded contracts for one year with two one-year renewals and are now on a month
to month basis.
Previously, the City collected a telecommunication tax from hotel operators who provided
telecommunications services to their customers. Auditing for compliance of this tax was
performed by the City's field agents and its auditing contractors. Effective October 1 , 2001 ,
the State of Florida collects this tax and remits a portion of the tax to the City. The State
now has the auditing responsibility for this telecommunication tax.
The Internal Audit objective for the current fiscal year is to audit 25 percent of the monthly
and 10 percent of the annual active resort tax accounts for a total of 300 accounts. The
Internal Audit Department will assign these audits to the City's field agents and
independent contractors. For the current year, the City has reduced its field agents from
four positions to three positions.
The contract term would be for a period of one year with the option of two one-year
renewals. Funds for resort tax audits are available from the resort tax fund. The budget
for the fiscal year 03/04 has been reduced from $150,000 to $120,000 for these
professional services. Expenditures for these external audit services amounted to
$113,794 for fiscal year 02/03.
At the meeting of the City Finance and Citywide Projects Committee held on January 15,
2003, the continued usage of contractors to supplement audit coverage of resort taxes was
discussed, and the issuance of a Request for Proposals (RFP) was recommended.
On February 5, 2003, the City Commission adopted a resolution authorizing the issuance
of a RFP for the provision of auditing service for resort taxes for a one-year period with two
one-year options to renew, and the extension of the existing agreements with Beverly
Young and The Bookkeepers on a month to month basis until new agreements are
executed.
The Administration later decided to add to this RFP a provision for audits of non-profit
organizations. The City Commission had previously expressed a desire to audit these non-
profit agencies which receive monies through the City. Funding sources consist of monies
from the general fund, resort tax fund, Community Development Block Grants, Home
Investment Partnerships and Emergency Shelter Grants. The City Commission has
requested that these agencies be included in the Internal Audit Department audit schedule.
The Internal Audit Department has identified 32 agencies that received funding totaling
$6,700,000 for fiscal years 01/02 and 02/03. Ranges in funding distributed to these
agencies were from $5,000 to $1,485,000.
November 25, 2003
Commission Memorandum
RFP - Audit of Resort Taxes and Non-Profit Organizations
Page 3 of 5
Outside firms could be contracted to provide assistance to the City's Internal Audit
department for audits of non-profit organizations. These firms would provide staff on a
part-time basis as needed to perform audit work under the direction of the City's Internal
Auditor. Contract pricing would be on an hourly rate with length of contract terms similarto
those for the resort tax contractors. The current average hourly rate for the City's staff and
senior auditors is $31. Funds for the audits of non-profit organizations would be from the
general fund. For fiscal year 03/04, $10,000 has been budgeted for these audits.
The following six proposals were received in response to RFP No. 58-02/03:
Firm
1 Beverly Young
2 The Bookkeepers
3 Forshee & Lockwood
4 Rodriquez, Trueba & Company
5 Sanson Kline Jacomino & Co
6 Urbach Kahn & Werlin
Submitted Pro osal for Audit T e
Non-Profit
Or anizations
NO
NO
YES
YES
YES
YES
Resort Tax
YES
YES
NO
YES
YES
YES
On September 10,2003 the City Manager via Letter to Commission (LTC) No. 214-2003
appointed an Evaluation Committee ("the Committee") consisting of the following
individuals:
1. Javier Nunez, CPA and Property Owner
2. Polly Burton, Local Business Owner Windjammer Cruise and Resident
3. Fred Berens, Budget Advisory Committee, and Resident
4. Georgina Echert, Assistant Finance Director, City of Miami Beach
5. James Sutter, Internal Auditor, City of Miami Beach
On October 21,2003, the Committee convened and decided to separate this RFP process
and evaluate and rank the firms based upon the two distinct components. The Committee
would evaluate the firms first for the audits on Resort Taxes and then for the non-profit
organizations.
Audits of Resort Taxes:
The Committee discussed the following RFP Evaluation Criteria factors used to evaluate
and rank the proposals for Resort Tax Audits:
. Experience and Qualification of the Proposer (25%)
. Experience and Qualification of the individuals assigned to audits (25%)
. Proposed fees per audit (50%)
The committee agreed that each firm had experience in auditing businesses in the
hospitality industry. The main deciding factor came down to the cost per audits. The cost
November 25, 2003
Commission Memorandum
RFP - Audit of Resort Taxes and Non-Profit Organizations
Page 4 of 5
for audits of monthly accounts ranged from $750 to $1,400 per audit and the cost for
annual accounts ranged from $600 to $1 ,400 per audit. Two of the five proposals listed an
additional fee of 15% of any collection resulting from the audit assessment. The results of
the evaluation ranked the top three firms as Urbach Kahn & Werlin, Beverly Young, and
Rodriquez, Trueba & Company. Scoring results per committee member were as follows:
Committee Beverly The Rodriquez, Sanson, Kline Urbach, Kahn
Member Youna Bookkee ers Trueba& Co. Jacomino & Co & Werlin
Nunez 100 1 85 4 90 2 70 5 90 2
Burton 90 3 72 4 95 1 70 5 94 2
Berens 95 2 83 4 95 2 80 5 100 1
Echert 90 2 70 4 80 3 60 5 100 1
Sutter 100 1 88 4 96 3 75 5 98 2
Rankina 2 4 3 5 1
It was recommended that the Administration negotiate and contract with the top three firms
as indicated above at a set price and assign audits to all three firms on a rotating basis. If
one firm cannot come to an agreement, then the other firm orfirms may be approached for
negotiation and contract.
Audits of Non-Profit OrQanizations:
The Committee discussed the following RFP Evaluation Criteria factors used to evaluate
and rank the proposals for Non-Profit Organization Audits:
. Experience and Qualification of the Proposer (25%)
. Experience and Qualification of the individuals assigned to audits (25%)
. Proposed Hourly Fees (50%)
The committee agreed that each firm had experience in auditing non-profit businesses.
The main deciding factor came down to the proposed hourly fees. Most firms proposed a
tier rate schedule for each professional position. The hourly rate for a staff position, the
one most likely to do the work, ranged from $50 to $100 per hour. The results of the
evaluation ranked the top two firms as Sanson Kline Jacomino & Co., and Urbach Kahn &
Werlin. Scoring results per committee member were as follows:
Committee Forshee & Rodriquez, Sanson, Kline Urbach, Kahn
Member Lockwood Trueba& Co. Jacomino & Co & Werlin
Nunez 65 4 95 1 90 3 95 1
Burton 65 4 93 3 100 1 94 2
Berens 65 4 90 3 95 2 100 1
Echert 60 4 80 3 100 1 90 2
Sutter 70 4 98 1 98 1 97 3
Rankina 4 3 1 2
The results of the evaluation ranked the top two firms as Sanson Kline Jacomino & Co, and
November 25, 2003
Commission Memorandum
RFP - Audit of Resort Taxes and Non-Profit Organizations
Page 5 of 5
Urbach Kahn & Werlin. It was recommended that the Administration negotiate and
contract with these two firms at a set hourly price and assign audits to both firms on a
rotating basis. If one firm cannot come to an agreement, then the other firm or firms may
be approached for negotiation and contract.
CONCLUSION
The Administration recommends that the Mayor and Commission adopt the resolution,
which accepts the City Manager's recommendation and authorizes the Administration to
enter into negotiations and contract with the top-ranked firms of Urbach Kahn & Werlin,
Beverly Young, and Rodriquez, Trueba & Company for Resort tax audits and Sanson Kline
Jacomino & Co, and Urbach Kahn & Werlin for audits of non-profit organizations. In the
event that one firm cannot come to an agreement, then the other firm or firms may be
approached for negotiation and contract.
JMG:MDB:JJS
T:lagenda\2003\CMemo_RFPResortTax.doc