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Home My WebLink About5/4/2016 - STAFF REPORTS - 4.C. �?ALM$A c V N t '1 S ahaurtv` a CITY COUNCIL STAFF REPORT DATE: MAY 4, 2016 UNFINISHED BUSINESS SUBJECT: CONTINUED DISCUSSION ON CITY ATTORNEY SERVICES AND OUTSIDE LEGAL SERVICES CONTRACTS FROM: David H. Ready, City Manager BY: Chief of Staff/City Clerk SUMMARY The City Council requested an item be placed on this agenda to continue discussion on in-house versus contracted city attorney services. Additionally, the City Council requested discussion on continuing specific outside specialized legal service contracts. RECOMMENDATION: Direct City Staff as appropriate. STAFF ANALYSIS: At the request of the City Council, City Staff prepared a report for discussion by the City Council relating to the delivery of legal services to the City — specifically to discuss options to continue to contract for city attorney services or to provide an in-house city attorney and staff. A copy of the February 17, 2016, Staff Report is attached for reference. To provide additional clarity on the part-time status of the City Attorney, while the City Attorney contract provides a retainer for the services of Douglas C. Holland, and requires him to be on site three-days per week -- the City Attorney does not qualify as part-time. In 2015, the City Attorney reported 1,455 hours worked on retainer and an additional 530 hours, for total hours of 1,985. Douglas C. Holland serves as City Attorney only for the City of Palm Springs, and does not serve as City Attorney to any other City. In 2015, the City received 4,373 Attorney work hours from Woodruff, Spradlin & Smart for general and transactional services (not including litigation). ITEM N0. 4- Co City Council Staff Report May 4, 2016 -- Page 2 City Attorney Services For cost comparison it is important to note, should the City Council choose an in-house attorney in addition to the estimated costs outlined in the February 17, 2106, Staff Report, an estimated 800 hours may be needed to continue the same level of current general and transactional services. Since the preliminary discussion City Staff was able to do a quick voluntary survey of cities in California with population of 30,000 to 80,000 (Survey Results Attached). To summarize the results of 91 cities responding to our survey request: In-House City Attorney 18 cities 20 percent Contracted City Attorney 71 cities 78 percent Elected City Attorney 2 cities 2 percent Additionally, all the cities in the Coachella Valley (Desert Hot Springs, Cathedral City, Rancho Mirage, Palm Desert, Indian Wells, La Quinta and Indio) have contract city attorney services. The City Council requested cost information to provide office space for the City Attorney and Departmental Staff. Staff anticipates sufficient office space can be located and/or created at City Hall for under $100,000. Additionally, the City Council requested discussion on continuing specific outside specialized legal service contracts as well at this meeting. FISCAL IMPACT: The costs of legal services are discussed in the February 17, 2016, Staff Report. No fiscal impact at this time relating specifically to this discussion item. MES THOMPSON DAVID H. READY Chief of Staff/City Clerk City Manager Attachments: February 17, 2016 Staff Report City Attorney Service Survey ��z O�pALMSp? iy V N x x Cg41FORN,P CITY COUNCIL STAFF REPORT DATE: FEBRUARY 17, 2016 NEW BUSINESS SUBJECT: PRELIMINARY DISCUSSION ON CITY ATTORNEY SERVICES FROM: David H. Ready, City Manager BY: Chief of Staff/City Clerk SUMMARY At the February 3, 2016, City Council meeting, Mayor Moon requested the City Manager place a discussion item on the next regular meeting agenda to discuss in-house vs. contracted city attorney services. RECOMMENDATION: Direct Staff as appropriate. STAFF ANALYSIS: City of Palm Springs Charter Section 407 requires the City Council appoint a city attorney, and Section 408 authorizes the City Council to enter into a contract with the City Attorney. In 2005, the City Council, after an RFP process, appointed Douglas C. Holland as the City Attorney, and entered into a contract with the law firm of Woodruff, Spradlin & Smart for legal services.' The current agreement provides a monthly retainer for the services of Douglas C. Holland in the amount of $25,679, and requires the City Attorney to be on- site, 3-days per week for transactional and general services. The billing rate for a partner or associate attorney and all other work performed by attorneys is $206 per hour, and the rate for legal assistants is $133 per hour, along with reimbursement of The Agreement provides an annual CPI increase not to exceed four (4) percent per year. Section 9 provides the contract remains in effect until terminated by either party, and the City may terminate the contract at any time without cause. The current agreement is posted on the City's website, under City Attorney. 03 City Council Staff Report February 17, 2016-- Page 2 City Attorney Services costs. The City, however, is not charged for clerical staff, and as a cost containment measure, the City is not charged for travel time or mileage. While the vast majority of the city attorney work is performed by Woodruff, Spradlin & Smart at the above rates, the City retains the services of other law firms for specialty work. Other firms have included the following and their respective billing rates for partner: Liebert, Cassidy & Whitmore (Labor Negotiations) $325 per hour Best, Best & Krieger (RDA) $325 per hour Kane, Ballmer & Berkman (RDA) $350 per hour Below are total costs for legal services for this fiscal year to date and the previous three fiscal years. FY 2012-13 FY 2013-14 FY 2014-15 YTD 2015-16 Woodruff(General and Transactional) $ 778,528 $ 765,356 $ 931,720 $ 446,601 Woodruff(Litigation) $ 679,784 $ 1,520,801 $ 1,737,697 $ 654,342 All other Legal Firms $ 116,602 $ 366,866 $ 585,120 $ 140,100 TOTAL LEGAL COSTS $ 1,574,914 $ 2,653,023 $ 3,254,537 $ 1,241,043 The annual costs for legal services are not entirely predictable; due to the number and severity of any claim or litigation filed, and the number and complexity of special projects required by the City Council or City Staff, in any given year. If the City Council were to consider transitioning to an in-house, city employee city attorney, an organizational model would likely be as follows: ( Salary2 Benefits Total City Attorney $ 240,000 $ 96,000 $ 336,000 Assistant City Attorney $ 150,000 $ 60,000 $ 210,000 Legal Assistant/Paralegal $ 90,000 $ 36,000 $ 126,000 Administrative Assistant $ 75,000 $ 30,000 $ 105,000 Other Costs (described below) $ 100,000 Contract Svc. — Specialty Labor/Personnel $ 90,000 TOTAL ESTIMATED COSTS $ 967,000 2 City Staff has not performed a comprehensive compensation/benefits study for the position of city attorney or other positions. The estimated city attorney salary is based on the median salary of the benchmark cities: Burbank, Downey, Riverside, and Escondido. City Council Staff Report February 17, 2016 -- Page 3 City Attorney Services Cost analysis for comparison would be the costs for the Woodruff general and transactional services (i.e. $931,720 for FY 2014-15) to the total estimated costs for in- house city attorney department (i.e. $967,000), as all other legal services costs such as litigation and specialized legal services are assumed to continue to be contracted legal services and not performed by in-house city attorney staff. Such an organizational model may include the city attorney office be responsible for: City Council and Staff general and transactional services, contract management of outside legal counsel, planning, planning commission, code enforcement, general personnel, airport, claims, etc. The City would still require outside legal counsel for labor negotiations, litigation services, and specialty attorneys, with costs noted above. Additionally, it is unknown if the City could retain the competitive hourly rate of $206 per hour for litigation, currently paid pursuant to the current comprehensive legal services contract with Woodruff, Spradlin & Smart. Other costs such as supplies, equipment online library and legal research databases, memberships, training and temporary staff for leave, etc., is estimated at $100,000 per year. In addition to salary, benefits, and other costs, the city would need to provide office space for the City Attorney and Departmental Staff and all related overhead costs and office start-up costs. FISCAL IMPACT: The costs of legal services are discussed above. No fiscal impact at this time relating specifically to this discussion item. MES THOMPSON DAVID H. READY, h.D. Chief of Staff/City Clerk City Manager �)5 CITY ATTORNEY Population between 30,00 to 80,000 City In-house Contracted Directly Elected Approximate Population Apple Valley X 70,500 Arcadia X 57,000 Azusa X 48,000 Baldwin Park X 76,000 Banning X 32,000 Beaumont X 40,000 Bell X 36,000 Bell Gardens X 43,000 Bellflower X 78,000 Beverly Hills X 38,000 Brea X 45,000 Brentwood X 54,000 Buena Park X 80,000 Calabasas X 25,000 Calexico X 42,000 Camarillo X 67,000 Campbell X 41,000 Carson X 80,000 Ceres X 47,000 Cerritos X 50,000 Chino Hills X 74,799 Claremont X 36,000 Colton X 53,000 Corona X 48,000 Coronado X 24,000 Culver City X 40,000 Cupertino X 58,302 Cypress X 50,000 Danville X 43,055 Diamond Bar X 56,000 East Palo Alto X 30,000 East Vale X 58,000 El Centro X 45,000 Encinitas X 60,000 Folsom X 73,000 Fountain Valley X 56,000 Gardena X 60,000 Gilroy X 52,000 Glendora X 50,073 Hanford X 56,000 Highland X 54,000 �s Huntington Park X 60,000 La Mesa X 58,000 La Mirada X 48,000 La Puente X 42,000 Laguna Niguel X 64,000 Lake Elsinore X 55,000 Lake Forest X 80,800 Lincoln X 44,000 Lodi X 64,000 Lompoc X 43,000 Lynwood X 70,000 Madera X 63,000 Manhattan Beach X 40,000 Manteca X 67,096 Menifee X 85,000 Milpitas X 72,000 Monrovia X 40,000 Monterey Park X 62,000 Mountain View X 77,014 National City X 59,000 Newark X 44,000 Novato 53,000 Palo Alto X 66,955 Paramount X 55,000 Perris X 71,000 Petaluma X 59,000 Pico Rivera X 64,000 Pittsburg X 67,000 Placentia X 52,000 Pleasanton X 72,000 Porterville X 55,000 Poway X 49,000 Rancho Palos Verdes X 45,000 Rancho Santa Margarita X 50,000 Redondo Beach X 68,000 Rocklin X 60,000 Rosemead X 55,000 San Bruno X 44,000 San Clemente X 65,000 San Jacinto X 46,000 San Luis Obispo X 47,000 San Rafael X 59,000 San Ramon X 76,000 Santa Cruz X 63,000 Santee X 55,800 Tulare X 62,000 Tustin X 78,000 IJ Union City X 69,516 Whittier X 80,000 Yorba Linda X 65,000 Yuba City H 65,773 fl�