Legal Opinion
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Parcher, Robert
From: Aguila, Raul
Sent: Tuesday, March 22, 2005 11 :04 AM
To: Parcher, Robert
Cc: Hemstreet, Tim; McKew, Kristin
Subject: RE: Legal Opinion - expending money beyond the "fee not to exceed" amount.
Bob:
This e-mail will confirm the discussion you, Tim Hemstreet, Kristin McKew, and I had with regard to your concern
on resolutions accompanying City AlE and/or construction contracts which reference a specific "not to exceed"
project amount, and subsequent amendment to those contracts (which effectively increase the not to exceed
amount).
There must be a distinction between the not to exceed amount specified in the initial resolution, and the City's
ability to process subsequent amendments to its AlE and/or construction contracts (usually for additional work
than what was originally contemplated in the initial reso/contract) ; the most important for your purposes being
that the amount set forth in the original reso should not be interpreted to preclude such contracts from being
amended.
In particular, it should be noted that when the initial contract is approved by the City Commission, it contains
language specifying the procedure for approving contract amendments. Typically, amendments of $25,000 or
under can be approved and executed administratively; amendments over $25,000 must be approved by the City
Commission.
Because of the fluctuating nature of capital projects, it would be impossible to negotiate a deal with the
expectation of establishing a not to exceed amount from the outset, and expect that to be the final amount
budgeted for the project. Therefore, the initial project amount, as set forth in the initial City Commission
resolution accompanying a particular AlE and/ or construction contract, represents the parties' estimate (albeit a
very educated, thought out, and well calculated one) of the proposed capital project cost-it does not, nor can it,
preclude future amendments of the contract. The procedure for approving these amendments are set forth in the
initial contact accompanying the resolution-thereby anticipating that, notwithstanding a "not to exceed" amount
set forth in the initial reso and contract, amendments may be necessary and contemplated.
I hope this answers your question. Thanks, Raul
-----Original Message-----
From: Parcher, Robert
Sent: Tuesday, March 22, 20057:36 AM
To: Aguila, Raul
Subject: Legal Opinion - expending money beyond the "fee not to exceed" amount.
Hi Raul, as you, Tim and I discussed, please don't forget to send me your opinion on this for the record.
Thanks
Bob
3/22/2005