AGENDA TITLE:
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Adopt a Resolution Authorizing the City Manager to Execute Amendment No. 1 to the Professional Services Agreement with Municipal Resource Group, LLC and Determining it is in the City’s Best Interest to Dispense with Competitive Bidding Requirements (Total Contract Not-to-Exceed $190,000) (CM)
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MEETING DATE:
March 5, 2025
PREPARED BY:
Laurie Montes, Assistant City Manager, Part-Time
recommendation
RECOMMENDED ACTION:
Adopt a Resolution Authorizing the City Manager to Execute Amendment No. 1 to the Professional Services Agreement with Municipal Resource Group, LLC and determining it is in the City’s best interest to dispense with competitive bidding requirements (Total contract not-to-exceed $190,000).
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BACKGROUND INFORMATION:
On September 3, 2024, the City Manager entered into a professional services agreement with Municipal Resource Group, LLC (MRG) for Human Resources (HR) On Demand Human Resources Consulting Services. Since then, Council and City employees worked with Teri Silva, MRG Affiliated Consultant, on numerous HR issues including policy development, advising departments on labor issues, and facilitating Council-Appointee performance evaluations. At a special Council meeting on February 11, 2025, Ms. Silva provided an assessment report on HR operations making a number of recommendations for improved performance (“Assessment Report”). Some of the recommendations in the Assessment Report include restructuring the HR division and modifying some of the HR positions to complete required workload, and updating policies and procedures to reflect current legal requirements.
Additional recommendations of the Assessment Report include items such as the development of a recruitment and selection policy that is detailed, consistent, and defensible; the development of policies that clearly outline the leaves program for City employees that include benefits provided through the Family Medical Leave Program and the California Family Rights Act; develop a citywide evaluation system to manage and support employee performance; implement efficiencies where current technology can be used to assist staff in doing their jobs. Improved policies and procedures reduce liability and improve organizational effectiveness.
An example of how the City’s policies create inefficiencies is related to a recent recruitment. The City was recruiting to fill a single vacancy. There were 33 candidates that met the minimum qualifications. All 33 candidates had to be interviewed because the City lacks standard, best practice, civil service ranking procedures. This is inefficient and undermines a merit-based system by passing along all candidates regardless of qualifications. Additional resources will enable the update and modernization of HR policies and procedures.
The Assessment Report recommends changes to the number and types of staff in the HR division. Any decisions requiring Council approval will be brought forward at a future meeting. The HR Department will continue to need MRG’s On-Demand HR services to implement the recommended changes.
The initial agreement with MRG for On-Demand HR services was for $60,000, which has been utilized to facilitate the Council-Appointee evaluation process, and by staff City-wide to assist with policy development, employee discipline procedures, compensation issues, recruitment procedures, and guidance on human resources issues broadly. Additional assistance in the amount of $130,000 through 2025 is needed to continue services in support of HR. This amount was determined based on the approximate number of hours MRG provided on a monthly basis and an estimate of a number of months needed to implement a many of the recommendations in the HR Assessment report. The On-Demand Services are estimated to be $130,000 based on 10 additional months of service at a rate of $260 per hour. Amendment No. 1 will provide approximately 500 hours of additional On-Demand HR support. With the additional funding, the total contract not-to-exceed amount is $190,000.
LMC 3.20.100 provides that “contractual services… greater than the city manager's contract authority [$60,000] … shall follow the formal contract procedure” and proceed with Council approval of specifications before going out to bid. However, the staffing level in HR is insufficient to keep up with the demands of the Human Resources Division and current policies and procedures are out of date. Additional consultant assistance is needed to complete Council-Appointee evaluations and to implement the HR Assessment recommendations to streamline workflows. Given MRG’s expertise in Human Resources, the ongoing work on Council Appointee evaluations, and MRG’s understanding of the HR needs of Lodi, staff recommends that City Council determine it is in the best interest of the City to maintain the continuity of services and dispense with competitive bidding requirements consistent with LMC 3.20.070 for the original Professional Services Agreement and the proposed Amendment No. 1 with MRG to add additional funding for continued On-Demand HR Services through 2025.
STRATEGIC VISION:
All
FISCAL IMPACT:
Additional funding required for Amendment No. 1 is $130,000, bringing the total not-to-exceed agreement cost to $190,000 which is covered by vacancy savings in the HR Division.
FUNDING AVAILABLE:
Funding for the additional services is available in 10020302.72450 Misc. Professional Services.
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Scott R. Carney
City Manager