Title
Emergency Medical Services, a Division of the Chief Administrative Office, recommending the Board:
1) Make findings pursuant to Section 3.13.030 (f) of the El Dorado County Ordinance Chapter 13, Contracting Out, that the provision of financial auditing services provided by Lance, Soll & Lunghard, LLP are in the public's best interest and a contract is necessary to protect against a conflict of interest or to ensure independent and unbiased findings where there is a need for an outside perspective;
2) Approve and authorize the Purchasing Agent to sign Agreement 9092 with Lance Soll & Lunghard, LLP, for financial auditing services for the County’s ambulance services providers, in the amount of $200,450, for a term of three years, commencing upon the execution of the agreement; and
3) Authorize the Purchasing Agent to execute any necessary amendments relating to said agreement, excluding term extensions and increases to the not-to-exceed amount, contingent upon approval by County Counsel and Risk Management.
FUNDING: County Service Areas 3 and 7.
Body
DISCUSSION / BACKGROUND
Public Agencies are required to comply with Generally Accepted Accounting Principles (GAAP), including causing to be completed an annual financial audit.
The County currently contracts with two Joint Powers Authorities (JPAs) for the provision of ambulance services within the County. The El Dorado County Emergency Services Authority (EDC ESA) provides services in the West Slope, and the California Tahoe Emergency Services Operations Authority (Cal Tahoe) provides services in the Tahoe Basin, excluding the West Shore area. The County has historically contracted with auditing firms to perform annual financial audits of the JPAs.
The JPAs are required to have their financial statements audited on an annual basis, both due to GAAP requirements and pursuant to their agreements with the County. The County historically selects and contracts with auditing firms for the auditing of the JPAs. The JPAs are fully funded by the County.
Richardson and Company, LLP has been performing the JPA audits since 2017. The most recent agreement with Richardson & Company, LLP, Agreement 4583, expired June 30, 2024. On February 20, 2024, Emergency Medical Services initiated a competitive Request for Proposal (RFP) 24-0030 for the CSA 3 and CSA 7 Auditing Services. Richardson & Company was the only qualified respondent to the RFP. In order to follow the best practice of periodically rotating audit firms, the contract was not awarded to Richardson & Company. Instead, the Division decided to explore utilizing the RFP that had been issued for the countywide audit.
On September 17, 2024, the Board approved Legistar Item 24-0976, awarding Lance, Soll & Lunghard, LLP the agreement for the countywide audit. The item also authorized the Purchasing Agent to negotiate a contract with Lance, Soll & Lunghard, LLP for audit services related to the County’s ambulance service providers. On the 17th, the Board also made findings that that a competitive bidding process for financial audit services related to the County’s ambulance service providers would produce no economic benefit to the County, and therefore is exempt from competitive bidding in accordance with Section 3.4.3 of Procurement Policy C-17. If approved, Agreement 9092 with Lance, Soll & Lunghard will provide annual financial audits of the JPAs for FY 2022-23 through FY 2025-26.
ALTERNATIVES
The Board could choose to not utilize Lance, Soll & Lunghard for the annual audits of the ambulance JPAs and procure other services or require that the JPAs procure financial audits separate from the County.
PRIOR BOARD ACTION
On April 18, 2017, the Board of Supervisors awarded the RFP to Richardson & Company, LLP and authorized the Purchasing Agent to execute an agreement for services. (17-0363)
On April 7, 2020, the Board of Supervisors authorized the Purchasing Agent to execute an agreement with Richardson & Company, LLP for services. (20-0383)
On July 23, 2024, Agreement 8734 with Richardson & Company, LLP was not approved by the Board. The item was continued off calendar (24-1025).
On September 17, 2024, the Board of Supervisors authorized an exemption from the competitive bidding process and authorizing the Purchasing Agent to negotiate a contract with Lance, Soll & Lunghard, LLP. (24-0976)
OTHER DEPARTMENT / AGENCY INVOLVEMENT
Auditor Controller
Chief Administrative Office
County Counsel
CAO RECOMMENDATION / COMMENTS
Approve as recommended.
FINANCIAL IMPACT
The annual financial audits of the JPAs are funded by County Service Areas 3 and 7. These County Service Areas were established to provide and fund ambulance services, and are funded primarily by ambulance fees, special taxes and assessments, and property taxes. The current budget includes allocations for these services.
The total compensation provided for under the agreement is $200,450, for services as indicated below:
FISCAL YEAR ENDING
JUNE 30, 2023 $49,000
JUNE 30, 2024 $49,000
JUNE 30, 2025 $50,470
JUNE 30, 2026 $51,980
TOTAL ANNUAL AUDITS $200,450
This contract has no General Fund impact.
CLERK OF THE BOARD FOLLOW UP ACTIONS
N/A
STRATEGIC PLAN COMPONENT
N/A
CONTACT
Sue Hennike, Assistant Chief Administrative Officer