SR-01-24-1978-6FTO: Mayor and City Council
FROM: City Staff
Santa Monica, Cal', ,rnia, January 11, 1978
JAN 2 4 1978
SUBJECT: Installation of a Uniform Reporting System of Financial and
Operating Data for the Transportation Department: Phase Il
Introduction
Regulations issued by the Federal Urban Mass Transportation Administration
(UMTA) describe precise requirements for uniform reporting of transit system
financial, accounting and operational information nationwide. To be eligible
for future Federal and State transit funds, the Transportation Department must
convert its existing accounting and information reporting system to the required
UMTA system by July 1, 1978.
City Staff has received and evaluated proposals from three qualified consulting
firms to develop and install the information systems necessary as a part of this
conversion. This report requests that the City Manager be authorized to retain
the firm of Arthur Andersen $ Co. to perform the work required.
Background
After years of development and refinement, UMTA issued final regulations approxi-
mately one year ago, which require transit properties to convert to a uniform
system of reporting financial accounting and operating information. To ease the
financial burden on transit operators, UMTA also announced that funds to help pay
for the conversion are available on an 80% Federal, 200 local matching basis for
qualified transit operators. The City is considered a qualified transit operator
and has applied for Federal funding. UMTA's approval of this request is expected
within the next two weeks.
JAN 2 4 1978
To: Mayor and Council; -2- nuary 11, 1978
Because of its complexity and the need to meet UMTA deadlines related to
project funding, this project was divided into district phases. The
phases are:
I Project Design (Including preparation of Notice of Intent
and Project Application)
II Project Implementation (Including installation and testing
of the system)
Phase I was completed on schedule with the assistance of the consulting firm
of Arthur Andersen $ Co. On December 21, staff mailed Request for Proposals
for Phase II work items to twelve consulting firms. The following three firms
responded with proposals:
Arthur Andersen $ Co.
Alexander Grant & Co.
Ernst $ Ernst
These proposals have now been evaluated by members of the City's Transportation
and Finance Departments, including Finance Department staff working in the Payroll
and Data Processing divisions. This evaluation considered both the technical
aspects of each proposal and the overall qualifications of each firm. The result
of this evaluation was a finding that the firm of Arthur Andersen $ Co. should be
retained by the City to perform the consultant tasks required in Phase II and for
a fee not to exceed $193,040 as presented in the firm's proposal.
Alternatives:
1. The City could choose not to install the uniform system of recordkeeping
and reporting. The result of this decision would be to make the City ineligible
to receive substantial Federal and State subsidies, which in turn is expected to
lead to dramatically higher bus fares and substantially reduced service.
2. City Staff could attempt to perform all tasks required in Phase II without
using consultant services. In order to accomplish this work, the City would have
to hire or train employees in several technical specialties or place a lower
priority on accomplishing other City work in several areas. Further, it is
extremely doubtful that all the work necessary to convert to the required system
could be completed in the time available.
To; Mayor and Council, -3- i nuary 11, 1978
Alternatives (cont'd)
3. The City could choose one of the two consulting firms not recommended
by Staff, or reject all three proposals and attempt to find other consultants
to perform the tasks required in Phase II. However, if all three proposals
are rejected, City Staff believes that requesting additional proposals would
not necessarily result in additional proposals of either higher quality or
lower cost. Just as important, the severe time restrictions imposed by UMTA
and the additional cost to the City argue against this alternative.
4. The City can retain the firm of Arthur Andersen 4 Co. to perform the required
Phase II project implementation.
Recommendation:
Staff recommends that City Council authorize the City Manager to retain the
firm of Arthur Andersen & Co., for a fee not to exceed $193,040, to perform
Phase II of the two phase project that will convert the existing Transportation
Department accounting and reporting system to the uniform system required by UMTA.
Prepared by
JFH /TRN /RHN /pls
J. F. Hutchison
T. R. Narrigan
R. H. Nash
agenda Item 6 -F:. Presented at thisitime was a recommendation to authorize
retention of the firm of Arthur Andersen $ Co. for a fee not to exceed
$193,040 to perform Phase II of the project to convert the existing
Transportation Department Accounting and Reporting System to the uniform
system required by Federal Urban Mass Transportation Administration. (U,7A).
Transportation Director Hutchison said the new accounting system is
mandated by UMTA to gather statistics necessary for government reporting.
Councilmember Reed moved to award Contract No. 2446(CCS) authorizing
retention of the firm of Arthur Andersen $ Co. for a fee not to exceed
$193,040 to perform Phase II of the project to convert the existing
Transportation Department Accounting and Reporting System to the uniform
system required by the Federal Urban Mass Transportation Administration.
Second by Councilmember Cohen.
Council Vote: Unanimously approved 5 -0
Absent: Councilmembers Trives, van den Steenhoven
CITY COUNCIL MINUTES - January 24„ 1978