Agenda Information Sheet
DEPARTMENT: Finance
ACM: Bryan Langley
Date: September 27, 2016
SUBJECT
Title
Receive a report, hold a discussion, and give staff direction regarding the City's contract for bond counsel services.
Body
BACKGROUND
On February 21, 2012, the City Council adopted Ordinance No. 2012-028 awarding a five year contract to McCall, Parkhurst and Horton, LLP ("MPH") for bond counsel services. This contract became effective March 27, 2012 and is due to expire on March 26, 2017. In an effort to reduce costs at that time, staff requested that MPH review it fee schedule for the City which resulted in a slight reduction in fees. At that time, staff estimated that the reduced fee schedule represented a savings of $2,500 on a $50 million bond sale. The current fee schedule is a graduated fee schedule with declining rates as the amount of bonds increases. Additionally, MPH agreed to include a provision that if an issue exceeded $100 million they would extend a negotiated discount for that issue. For the upcoming Utility System Revenue Bonds, Series 2016, the firm agreed to a discount of approximately $38,000 to coincide with their proposed fees for a potential new contract. This discount is not contingent upon approval of a contract.
In anticipation of this approaching expiration date, staff requested a proposed fee schedule from MPH for this service assuming a five year continuous term contract. Below are the current and proposed fees:
Current Fee
Proposed Fee
Bond Counsel Services:
Base Fee for first $1 million of Bonds
$5,000
$5,000
Plus 1,000 of Bonds for next $9 million of Bonds
$1.00
$1.00
Plus 1,000 of Bonds for next $30 million of Bonds
$0.95
$0.95
Plus 1,000 of Bonds thereafter1
$0.90
N/A
Plus 1,000 of Bonds for next $60 million of Bonds
N/A
$0.90
Plus 1,000 of Bonds thereafter
N/A
$0.50
Optional Legal Disclosure Services2:
Partner
$250 per hour
$375 per hour
Associate
$150 ...
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