AGENDA INFORMATION SHEET
DEPARTMENT: Denton Municipal Electric
CM: Todd Hileman
AGENDA DATE: March 27, 2017
SUBJECT
Title
Consider recommending the adoption of an ordinance of the City Council of the City of Denton authorizing the City Manager to execute an Engagement Letter with the law firm of David A. Portz, P.C., Houston, Texas, for professional legal services to be provided to the Energy Management Organization of the City’s Electric Department, Denton Municipal Electric; authorizing the expenditure of funds therefor; and providing an effective date (File No. 5554 - in the additional amount of not-to-exceed $75,000; aggregating not-to-exceed $250,000).
Body
BACKGROUND
On April 28, 2014 the City entered into an agreement wherein David A. Portz, P.C., an Attorney (“Portz”), Houston, Texas, was engaged for an amount not-to-exceed $75,000, within the City Manager’s delegated signature authority, for legal services to be rendered to the Denton Municipal Electric - Energy Management Organization (“EMO”) relating to the review and negotiation of EEI Master Agreements with various counterparties in physical power transactions.
Later, on November 18, 2014 the City entered into a first supplemental engagement letter with Portz for an additional amount not-to-exceed $50,000 and increased the scope of Portz’ professional services. The Council approved the engagement by Ordinance No. 2014-393. Portz is an experienced attorney whose practice is in the area of power trading and power-related transactions.
Last year, on March 1, 2016 the City entered into the second supplemental engagement letter with Portz for an additional amount not-to-exceed $50,000 and increased the scope of Portz’ professional services. The Council approved the engagement by Ordinance No. 2016-065. Portz is an experienced attorney whose practice is in the area of power trading and power-related transactions.
The activities of the EMO have since expanded and the further legal services of Portz are necessary to support continued EEI negotiations, ramping up of ISDA negotiations, and a memo on Dodd Frank compliance issues related to ISDA agreements. This field of law is highly specialized and Portz complements the City staff regarding such activities.
Staff is seeking an additional expenditure authority of not-to-exceed $75,000, aggregating an amount not-to-exceed $250,000.
RECOMMENDATION
City staff recommends that the Board approve the third supplemental and amended engagement letter with Portz.
ESTIMATED SCHEDULE OF PROJECT
The services to be performed will begin immediately upon Council approval. The agreement will remain in effect for the period which may be reasonably required for completion of the project.
PRIOR ACTION/REVIEW (Council, Boards, Commissions)
Scheduled for Council consideration on April 4, 2017
FISCAL INFORMATION
The legal services will be funded from Denton Municipal Electric Power Supply Administration Operating Account# 600002.7856.9210A.
BID INFORMATION
In accordance with Texas Local Government Code 252.022, the procurement of professional services is exempt from the requirement of competition based selection. The City of Denton has previous successful experience with the recommended firm, and has elected to not seek qualification based competition for these identified services.
STRATEGIC PLAN RELATIONSHIP
The City of Denton’s Strategic Plan is an action-oriented road map that will help the City achieve its vision. The foundation for the plan is the five long-term Key Focus Areas (KFA): Organizational Excellence; Public Infrastructure; Economic Development; Safe, Livable, and Family-Friendly Community; and Sustainability and Environmental Stewardship. While individual items may support multiple KFAs, this specific City Council agenda item contributes most directly to the following KFA and goal:
Related Key Focus Area: Organizational Excellence
Related Goal: 2.3 Promote superior utility services and facilities
EXHIBITS
1. Third Supplemental and Amended Engagement Letter
2. Proposed Ordinance
Respectfully submitted:
Lawrence Collister, 349-8333
Deputy City Attorney
Prepared by:
Lisa Collaud
Business Analyst - Energy Services