SR 07-18-2023 5H
City Council
Report
City Council Meeting: July 18, 2023
Agenda Item: 5.H
1 of 4
To: Mayor and City Council
From: Gigi Decavalles-Hughes, Director, Finance Department, Procurement
Subject: Approval of Fifth Contract Modification with Gafcon for Citywide State and
Federal labor compliance and certified payroll monitoring
Recommended Action
Staff recommends that the City Council:
1. Authorize the City Manager to negotiate and execute a fifth modification to
agreement #10435 in the amount of $210,000 with Gafcon, Inc. to provide
citywide State and Federal labor compliance and certified payroll monitoring on
an as-needed basis, for an additional seven-month period. This will result in a
seven years and seven months amended agreement with a new total amount not
to exceed $1,710,000, with future year funding contingent on Council budget
approval; and
2. Adopt a finding of no possibility of significant effect pursuant to Section
15061(b)(3) (Common Sense Exemption) of the California Environmental Quality
Act (CEQA) Guidelines
Summary
The City has a contract with Gafcon, Inc. (Gafcon) to provide certified payroll monitoring
services for work that is subject to the State and Federal prevailing wage requirements
mandated for all Public Works projects by State law. Gafcon is currently monitoring
145 active citywide projects. Project size and scope vary, from large projects with over
80+ contractors to smaller scale projects with one or two contractors. Gafcon services
consist of job classification review at solicitation, certified payroll and apprenticeship
compliance monitoring, on-site interviews of workers and if needed, enforcement of
labor compliance laws. Gafcon has extensive experience and knowledge of labor laws,
apprentice program requirements, and other requirements to ensure compliance with
State and Federal regulations. Staff anticipates that the current approved contract
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authority with Gafcon would not be sufficient to cover services while staff completes a
Request for Proposal (RFP) process that is currently in progress. Therefore, staff seeks
approval to increase the contract amount by an additional $210,000 to ensure continuity
of these critical services through January 2024.
Discussion
Two 2014 California laws (SB 7 and SB 854) define prevailing wage requirements and
establish responsibilities for prevailing wage payment on Public Works projects. City
prevailing wage projects include construction and maintenance of public buildings,
public works infrastructure and similar facilities, and projects funded in part or in whole
by Federal or State grants. The City must: 1) award public works bids in compliance
with the law and report these bid awards to the California Department of Industrial
Relations (DIR); and 2) ensure contractors/ subcontractors register with the DIR and
provide accurate and compliant certified payroll and other records to the Labor
Commissioner.
State labor laws require prevailing wage payment for certain labor categories identified
in the State of California Labor Code (commencing in Section 1770 et seq.) when
employed for any work on or in the execution of a Publi c Works project. Gafcon
ensures that the Prime Contractor and Subcontractors comply with all California Labor
Codes as outlined by the DIR. During the span of a project, Gafcon assists with the
following:
• Review and audit of certified payroll records to assure compliance with
laws/regulations;
• Compliance review in accordance with apprenticeship laws/regulations
and training fund contributions;
• Identification of labor compliance violations and resolution of issues and
estimated calculation of potential penalties/fines;
• On-site inspections and worker interviews; and
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• Provide monthly withhold recommendations based on the contractor's
compliance with labor laws/regulations through project close -out.
While the monthly payment amount fluctuates, the modification amount is based on a
monthly spending average of $35,000 and an expected increase in projects, including
larger projects that are being monitored, such as Arcadia Water Treatment Facility, and
City Yards Modernization. Staff is currently conducting an RFP process and anticipates
completing the process later this year, at which point staff would come back to Council
to seek approval of a new contract prior to expiration of the proposed extended term.
Past Council Actions
Meeting Date Description
12/15/20
(Attachment A)
Third Modification to Gafcon Contract for Citywide Prevailing
Wage and Labor Compliance
03/27/18
(Attachment B)
Second Modification to Gafcon Contract for Citywide Prevailing
Wage and Labor Compliance
02/28/17
(Attachment C)
First Modification to Gafcon Contract for Citywide Prevailing
Wage and Labor Compliance
Environmental Review
The modification to the contract with Gafcon is exempt from the California
Environmental Quality Act (CEQA) pursuant to Section 15061(b)(3) (Common Sense
Exemption) of the CEQA Guidelines, which states that CEQA does not apply, “where it
can be seen with certainty that there is no possibility that the activity in question may
have a significant effect on the environment. The modification to the contract would
provide administrative services for the City and therefore it can be seen with certainty
that the activity would not result in a significant effect on the environment.
Financial Impacts and Budget Actions
Staff seeks authority to approve funding from various funds to increase the amount
of agreement #10435 with Gafcon Inc. by $210,000 to provide citywide State and
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Federal labor compliance and certified payroll monitoring on an as-needed basis.
Funds are available within existing budgets and would be charged to the appropriate
Division or project account based on necessary and required oversight and labor
compliance services.
Contract Modification Request
Agreement #
Current
Authorized
Amount
FY 2023-24 Modified
Request Amount
Dept/CIP
Account #
Total Revised
Contract
Amount
10435 $1,500,000 $210,000 Various $1,710,000
Future year funding is contingent on Council budget approval.
Prepared By: Oscar Santiago, Budget Manager
Approved
Forwarded to Council
Attachments:
A. Gafcon, Inc. FY22-23 Oaks
B. Attachment C - Gafcon First Contract Modification - 2.28.17
C. Attachment B - Gafcon 2nd Contract Modification - 3.27.18
D. Attachment A - Gafcon 3rd Contract Modification - 12.15.20
E. Gafcon Contract#10435 agreement and modifications
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CITY OF SANTA MONICA
OAKS INITIATIVE NOTICE
NOTICE TO APPLICANTS, BIDDERS, PROPOSERS
AND OTHERS SEEKING DISCRETIONARY PERMITS, CONTRACTS,
OR OTHER BENEFITS FROM THE CITY OF SANTA MONICA
Santa Monica s voters adopted a City Charter amendment commonly known as
the Oaks Initiative. The Oaks Initiative requires the City to provide this notice and
information about the Initiative s requirements. You mayobtain a full copy of the Initiative s
text from the City Clerk.
This information is required by City Charter Article XXII Taxpayer Protection. It
prohibits a public official from receiving, and a person or entity from conferring, specified
personal benefits or campaign advantages from a person or entity after the official votes,
or otherwise takes official action, to award a public benefit to that person or entity. The
prohibition applies within and outside of the geographical boundaries of Santa Monica.
All persons or entities applying or receiving public benefits from the City of Santa
Monica shall provide the names of trustees, directors, partners, and officers, and names
of persons with more than a 10% equity, participation or revenue interest. An exception
exists for persons serving in those capacities as volunteers, without compensation, for
organizations exempt from income taxes under Section 501(c)(3), (4), or (6), of the
Internal Revenue Code. However, this exception does not apply if the organization is a
political committee or controls political committees. Examples of a public benefit include
public contracts to provide goods or services worth more than $25,000 or a land use
approval worth more than $25,000 over a 12-month period.
In order to facilitate compliance with the requirements of the OaksInitiative, the City
compiles and maintains certain information. That information includes the name of any
person or persons who is seeking a public benefit.If the public benefit is sought by an
entity, rather than an individual person, the information includes the name of every person
who is: (a) trustee, (b) director, (c) partner, (d) officer, or has (e) more than a ten percent
interest in the entity. Therefore, if you are seeking a public benefit covered by the Oaks
Initiative, you must supply that information on the Oaks Initiative Disclosure Form. This
information must be updated and supplied every 12 months.
DocuSign Envelope ID: 7645E9DF-EBEA-442E-AB47-9008B811977F
5.H.a
Packet Pg. 374 Attachment: Gafcon, Inc. FY22-23 Oaks (5833 : Fifth Contract Modification with Gafcon)
CITY OF SANTA MONICA
OAKS INITIATIVE DISCLOSURE FORM
In order to facilitate compliance with the requirements of the Oaks Initiative, the City
compiles and maintains certain information. That information includes the name of any
person or persons who is seeking a public benefit.If the public benefit is sought by
an entity, rather than an individual person, the information includes the name of every
person who is: (a) trustee, (b) director, (c) partner, (d) officer, or has (e) more than a ten
percent interest in the entity.
Public benefits include:
1. Personal services contracts in excess of $25,000 over any 12-month period;
2. Sale of material, equipment or supplies to the City in excess of $25,000 over a 12-
month period;
3. Purchase, sale or lease of real property to or from the City in excess of $25,000
over a 12- month period;
4. Non-competitive franchise awards with gross revenue of $50,000 or more in any
12-month period;
5. Land use variance, special use permit, or other exception to an established land
use plan, where the decision has a value in excess of $25,000;
6. Tax abatement, exception, or benefit of a value in excess of $5,000 in any 12-
month period; or
7. Payment of cash or speci of a net value to the recipient of $10,000 in any 12-
month period.
Name(s) of persons or entities receiving public benefit:
Name(s) of trustees, directors, partners, and officers:
Name(s) of persons with more than a 10% equity, participation, or revenue interest:
Prepared by: ____________________________Title: __________________________
Signature: ______________________________________ Date: ________________
Email: ____________________________________ Phone: ____________________
FOR CITY USE ONLY:
Bid/PO/Contract # ____________________________ Permit # ___________________________
Gafcon, Inc.
Robin Duveen, President and COO; Yehudi Gaffen, CEO; Paul Najar, SVP &
General Counsel; Pam Gaffen, Director; Bryan Benso, CDO
Yehudi A. Gaffen & Pamela S. Gaffen, Trustees of the Gaffen Family Trust;
Pamela S. Gaffen, Trustee of Pam Gaffen 2012 Exempt Trust
Mitzi Barnes Legal Practice Specialist
mbarnes@gafcon.com (858) 875-0010
DocuSign Envelope ID: 7645E9DF-EBEA-442E-AB47-9008B811977F
8/17/2022
5.H.a
Packet Pg. 375 Attachment: Gafcon, Inc. FY22-23 Oaks (5833 : Fifth Contract Modification with Gafcon)
City Council
Report
City Council Meeting: February 28, 2017
Agenda Item: 3.F
1 of 3
To: Mayor and City Council
From: Gigi Decavalles-Hughes, Director, Finance Department, Procurement
Subject: Modification to Gafcon Contract for Citywide Prevailing Wage and Labor
Compliance
Recommended Action
Staff recommends that the City Council authorize the City Manager to negotiate and
execute a first modification to Agreement #3142 in the amount of $220,000 with Gafcon,
Inc., a California-based company, to provide citywide labor compliance and certified
payroll monitoring on an as-needed basis. This will result in a three-year amended
agreement with a new total amount not to exceed $300,000, with future year funding
contingent on Council budget approval.
Executive Summary
In May 2016, staff executed an agreement in the amount not to exceed $80,000 with
Gafcon, Inc. to provide certified payroll monitoring services for projects subject to State
and Federal prevailing wage requirements. Services consist of job classification
selection, certified payroll compliance monitoring, on-site interviews of workers, and
enforcement if needed. The contract was executed under the City Manager’s authority
based on estimated need and initially monitored 40 projects. Currently the City has 81
projects being monitored, and staff has spent approximately $53,000 of the initial
$80,000 contract through February 2017. Based on a better understanding of actual
use, and to ensure service provision continues, staff recommends additional contract
authority, which puts the agreement at the threshold for Council approval. Staff
recommends that the City Council authorize the City Manager to amend the agreement
with Gafcon, Inc., by $220,000 for a new total amount not to exceed $300,000 over a
three-year period.
Background
Two 2014 California laws (SB 7 and SB 854) define prevailing wage requirements, and
establish responsibilities for prevailing wage payment. SB 7 establishes that Charter
cities must pay prevailing wages to receive or use State funding or financial assistance
for construction projects, and SB 854 introduces a public works contractor registration
program, and sets additional compliance requirements. Prevailing wage law applies to
any Public Works project that exceeds $15,000 for repair/maintenance and $25,000 for
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new construction. The law requires prevailing wage payment to certain labor categories
identified in the State of California Labor Code (commencing in Section 1770 et seq.)
when employed for any work on or in the execution of a Public Works project . The City
must 1) award public works bids in compliance with the law and report these bid awards
to the California Department of Industrial Relations (DIR); and 2) ensure
contractors/subcontractors register with the DIR and provide certified payroll records to
the Labor Commissioner.
Staff determined that an external group with specific expertise would be best suited to
monitor prevailing wage compliance, given the City’s large number of affected projects,
and the detail and complexity required for effective oversight. Following a competitive
process, staff contracted with Gafcon, Inc. in May 2016 to assist with prevailing wage
labor compliance and payroll monitoring. The contract was executed under the City
Manager’s authority based on estimated need. Staff has spent approximately $53,000
of the initial $80,000 contract through February 2017.
Discussion
City prevailing wage projects include construction and maintenance of public buildings,
housing, public work infrastructure and similar facilities, and could include projects
funded in part or in whole by Federal or State grants. Monthly, on average, the City has
30 projects requiring Department of Industrial Relations review and labor compliance.
The consultant verifies that job classifications called for in bids are appropriate for the
scope of work, and ensures that the contractors and all of their subcontractors meet
certified payroll requirements.
Staff recommends that Council approve a first modification to purchase agreement
#3142 in the amount of $220,000 with Gafcon, Inc. to provide citywide l abor compliance
and certified payroll monitoring services for a total amount not to exceed $300,000 over
three years. The modification amount is based on average annual spending by
Departments and Divisions for City prevailing wage projects over the past 10 months.
Vendor/Consultant Selection
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Packet Pg. 377 Attachment: Attachment C - Gafcon First Contract Modification - 2.28.17 (5833 : Fifth Contract Modification with Gafcon)
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In February 2016, the City published a Request for Proposals (RFP) for Prevailing
Wage and Certified Payroll monitoring. The RFP was posted on the City's on -line
bidding site. The system notified 1,125 vendors; 33 vendors downloaded the proposal,
and nine proposals were received on March 1, 2016. The proposal was evaluated
based on the criteria listed in the RFP, including successful prior experience working on
State and Federal projects, references, project team, sample reports and cost. Gafcon,
Inc. has extensive experience monitoring and reporting on prevailing wages, conducting
on-site labor interviews, and reviewing certified payrolls. Gafcon also has extensive
knowledge of labor laws, apprentice program requirements, and other requirements to
ensure compliance with State regulations. Based on the RFP criteria and in accordance
with SMMC 2.24.073, staff selected Gafcon, Inc. as the best qualified firm. The
recommended modification is to increase the contract amount and extend contract
length.
Financial Impacts and Budget Actions
The agreement modification to be awarded to Gafcon, Inc. is $220,000, for an amended
agreement total not to exceed $300,000. Funds are available within existing budgets,
and would be charged to the appropriate Division or project account based on request
for oversight and labor compliance services. Future year funding is contingent on
Council budget approval and budget adoption.
Prepared By: Araceli Esparza, Purchasing Services Manager
Approved
Forwarded to Council
5.H.b
Packet Pg. 378 Attachment: Attachment C - Gafcon First Contract Modification - 2.28.17 (5833 : Fifth Contract Modification with Gafcon)
City Council
Report
City Council Meeting: March 27, 2018
Agenda Item: 3.I
1 of 4
To: Mayor and City Council
From: Gigi Decavalles-Hughes, Director, Finance Department, Procurement
Subject: Second Modification to Gafcon Contract for Citywide Prevailing Wage and
Labor Compliance
Recommended Action
Staff recommends that the City Council authorize the City Manager to negotiate and
execute a second modification to Contract No. 10435, in the amount of $600,000 for
three years with two additional one-year renewal options with Gafcon, Inc., a California-
based company, to provide citywide State and Federal labor compliance and certified
payroll monitoring on an as-needed basis. This will result in a five-year amended
agreement with a new total amount not to exceed $900,000, with future year funding
contingent on Council budget approval.
Executive Summary
Since 2016, Gafcon, Inc. (Gafcon) has provided certified payroll monitoring services for
city projects subject to State and Federal prevailing wage requirements. Services
consist of job classification selection, certified payroll compliance monitoring, on-site
interviews of workers, and enforcement if needed. Although a formal solicitation was
conducted, the original three-year contract was executed under City Manager authority
as a pilot to ensure compliance with state-mandated requirements in a timely fashion. At
the time, staff did not have a full understanding about the quantity of projects that would
require monitoring. The first modification on February 28, 2017, addressed this issue as
staff developed a better understanding of actual use. As of the first modification, Gafcon
was monitoring 81 projects. Gafcon is currently monitoring 105 active projects citywide.
Due to an increase in the number of projects currently monitored, in anticipation of
future large-scale projects, and to support the addition of Davis-Bacon Act Federal
Prevailing Wage compliance monitoring, staff recommends amending the agreement
with Gafcon in the amount of $600,000 for three years, with two additional one-year
renewal options, for a new total amount not to exceed $900,000 over a five-year period.
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Packet Pg. 379 Attachment: Attachment B - Gafcon 2nd Contract Modification - 3.27.18 (5833 : Fifth Contract Modification with Gafcon)
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Background
Two 2014 California laws (SB 7 and SB 854) define prevailing wage requirements, and
establish responsibilities for prevailing wage payment. Prevailing wage law applies to
any Public Works project that exceeds $15,000 for repair/maintenance and $25,000 for
new construction. The law requires prevailing wage payment to certain labor
categories identified in the State of California Labor Code (commencing in Section
1770et seq.) when employed for any work on or in the execution of a Public Works
project. The City must 1) award public works bids in compliance with the law and report
these bid awards to the California Department of Industrial Relations (DIR); and 2)
ensure contractors/subcontractors register with the DIR and provide certified payroll
records to the Labor Commissioner.
On May 31, 2016, following a formal Request for Proposals (RFP), under City Manager
authority, staff executed agreement #3142 in the amount not to exceed $80,000 over a
three-year period with Gafcon to provide certified payroll monitoring services for projects
subject to State and Federal prevailing wage requirements.
On February 28, 2017 (Attachment A), a first modification to Contract No. 10435 (CCS),
formerly known as agreement #3142, was approved by Council in the amount of
$220,000 over a three-year period with a new total amount not to exceed $300,000.
Discussion
City prevailing wage projects include construction and maintenance of public buildings,
housing, public work infrastructure and similar facilities, and could include projects
funded in part or in whole by Federal or State grants. Gafcon is currently monitoring 105
active projects Citywide.
Gafcon ensures that the Prime Contractor and Subcontractors comply with all California
Labor Codes as outlined by California State Department of Industrial Relations (DIR).
During the span of a project, Gafcon assists with the following:
Audit of certified payroll records to assure compliance with laws/regulations;
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Compliance with apprenticeship laws/regulations and training fund contributions;
Identifies labor compliance violations and resolves issues and calculates
applicable penalties/fines;
Conducts on-site inspections and worker interviews;
Provides the City progress payment and withhold recommendations based on
the contractor’s compliance with labor laws/regulations through project close-out.
Gafcon will now also monitor Federal Davis-Bacon Act prevailing wage compliance
requirements. This work has been done on a case-by-case basis individually by various
contractors. Adding this scope to the existing contract with Gafcon will afford continuity
by providing one point of contact. The City has three to five federally-funded projects
which require adherence to federal and state prevailing wage laws. The added scope
for this work would be minimal as three to five projects represent only approximately
three to five percent of the total number of projects monitored.
The larger projects currently being monitored by Gafcon include: City Services Building,
Clean Beaches Initiative, Water Main Replacement, and Parking Structure Repairs.
These are larger projects that require significant labor compliance and monitoring.
Gafcon also oversees and manages the City’s Labor Compliance Program for Prop 84-
funded projects, which includes annual reporting to DIR. The two additional one-year
renewal options would ensure the projects mentioned above continue to be monitored
efficiently and would ensure a smooth project close-out.
Anticipated future large-scale projects include the City Yards Modernization Project,
with a requested project budget of $114,000,000, and Fire Station #1, with a requested
project budget of $41,000,000. Of the $600,000 requested for this second modification,
approximately half will fund compliance monitoring for the current and future large-scale
projects mentioned above. For example, the City Services Building alone will budget
approximately $125,000 for Prevailing Wage and Labor Compliance charges.
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Gafcon has agreed to honor their pricing for the two additional one-year renewal option
terms and the additional scope. The modification amount is based on a monthly
spending average of $14,700 by Departments and Divisions for a steadily increasing
number of City prevailing wage projects since May 2016. Staff recommends the
approval of a second modification to Contract No. 10435 (CCS) in the amount of
$600,000 with two additional one-year renewal options with Gafcon to provide citywide
State and Federal labor compliance and certified payroll monitoring services for a total
amount not to exceed $900,000 over five years.
Financial Impacts and Budget Actions
The contract modification to be awarded to Gafcon is $600,000 with two additional one-
year renewal options, for an amended agreement total not to exceed $900,000 over a
five-year period. Funds are available within existing budgets, and would be charged to
the appropriate Division or project account based on request for oversight and labor
compliance services. Future year funding is contingent on Council budget approval and
budget adoption.
Prepared By: Araceli Esparza, Purchasing Services Manager
Approved
Forwarded to Council
Attachments:
A. February 28, 2017 Staff Report (Weblink)
B. Gafcon Oaks Form
5.H.c
Packet Pg. 382 Attachment: Attachment B - Gafcon 2nd Contract Modification - 3.27.18 (5833 : Fifth Contract Modification with Gafcon)
City Council
Report
City Council Meeting: December 15, 2020
Agenda Item: 3.E
1 of 3
To: Mayor and City Council
From: Gigi Decavalles-Hughes, Director, Finance Department, Procurement
Subject: Approval of Third Modification to Gafcon Contract to Provide Citywide State
and Federal Labor Compliance and Payroll Monitoring
Recommended Action
Staff recommends that the City Council authorize the Interim City Manager to negotiate
and execute a third modification to agreement #10435 with Gafcon, Inc. that would
extend the contract by two years and add $600,000 to provide citywide State and
Federal labor compliance and certified payroll monitoring on an as-needed basis. This
will result in a seven-year agreement with a new total amount not to exceed $1,500,000,
with future year funding contingent on Council budget approval.
Summary
In May of 2016, staff executed an agreement #10435 with Gafcon Inc. to provide
certified payroll monitoring services that were subject to the State and Federal
prevailing wage requirements mandated for all Public Works projects by State law.
Gafcon is currently monitoring 142 active projects citywide. Their services consist of job
classification selection at time of solicitation, on-site interviews of workers, certified
payroll compliance monitoring and, if needed, enforcement. Gafcon has extensive
experience and knowledge of labor laws, apprentice program requirements, and other
requirements to ensure compliance with State and Federal regulations. Staff
recommends a third modification to extend agreement #10435 for two additional years
with up to $600,000 in additional funding to provide citywide State and Federal labor
compliance and certified payroll monitoring on an as-needed basis for a new not to
exceed $1,500,000 seven-year agreement. The two-year term extension would ensure
that staff has ample time to go through the RFP process and continue its labor
compliance and reporting, activities disrupted this year by the COVID pandemic.
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Packet Pg. 383 Attachment: Attachment A - Gafcon 3rd Contract Modification - 12.15.20 (5833 : Fifth Contract Modification with Gafcon)
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Discussion
Two 2014 California laws (SB 7 and SB 854) define prevailing wage requirements and
establish responsibilities for prevailing wage payment. City prevailing wage projects
include construction and maintenance of public buildings, housing, public work
infrastructure and similar facilities, and could include projects funded in part or in
whole by Federal or State grants. The City must: 1) award public works bids in
compliance with the law and report these bid awards to the California Department of
Industrial Relations (DIR); and 2) ensure contractors/ subcontractors register with the
DIR and provide certified payroll records to the Labor Commissioner.
The laws require prevailing wage payment to certain labor categories identified in the
State of California Labor Code (commencing in Section 1770 et seq.) when employed
for any work on or in the execution of a Public Works project. Gafcon ensures that the
Prime Contractor and Subcontractors comply with all California Labor Codes as
outlined by the DIR. During the span of a project, Gafcon assists with the following:
• Audit of certified payroll records to assure compliance with laws/regulations;
• Compliance with apprenticeship laws/regulations and training fund contributions;
• Identifies labor compliance violations and resolves issues and calculates
applicable penalties/fines;
• Conducts on-site inspections and worker interviews;
• Provides the City progress payment and withhold recommendations based on
the contractor's compliance with labor laws/regulations through project close -out.
Gafcon has agreed to honor their pricing for the two additional years. The modification
amount is based on a monthly spending average of $25,000 by Departments and
Divisions for a number of City prevailing wage projects. The recommended contract
modifications would enable the City to continue prevailing wage and labor compliance
for current Public Works projects and COVID-19 related projects throughout the City.
Past Council Actions
5.H.d
Packet Pg. 384 Attachment: Attachment A - Gafcon 3rd Contract Modification - 12.15.20 (5833 : Fifth Contract Modification with Gafcon)
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Meeting Date Description
03/27/18
(attachment A)
Second Modification to Gafcon Contract for Citywide Prevailing
Wage and Labor Compliance in the amount of $600,000
02/28/17
(attachment B)
First Modification to Gafcon Contract for Citywide Prevailing
Wage and Labor Compliance in the amount of $220,000
Financial Impacts and Budget Actions
Staff seeks authority to approve funding from various funds to increase the amount of
agreement #10435 with Gafcon Inc. by $600,000 to provide citywide State and Federal
labor compliance and certified payroll monitoring on an as-needed basis. Funds are
available within existing budgets and would be charged to the appropriate Division or
project account based on request for oversight and labor compliance services. Future
year funding is contingent on Council budget approval.
Contract/Agreement/Purchase Order Modification Request
Agreement #
Current Authorized
Amount
FY 2020-21 Budget Modified
Request Amount
Dept/CIP
Account #
Total Revised
Contract Amount
10435 $900,000 $600,000 Various $1,500,000
Prepared By: Araceli Esparza, Purchasing Services Manager
Approved
Forwarded to Council
Attachments:
A. 2nd Modification to Gafcon Contract (Weblink)
B. 1st Modification to Gafcon Contract (Weblink)
C. Gafcon Oaks Initiative
5.H.d
Packet Pg. 385 Attachment: Attachment A - Gafcon 3rd Contract Modification - 12.15.20 (5833 : Fifth Contract Modification with Gafcon)
5.H.e
Packet Pg. 386 Attachment: Gafcon Contract#10435 agreement and modifications (5833 : Fifth Contract Modification with Gafcon)
5.H.e
Packet Pg. 387 Attachment: Gafcon Contract#10435 agreement and modifications (5833 : Fifth Contract Modification with Gafcon)
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Packet Pg. 388 Attachment: Gafcon Contract#10435 agreement and modifications (5833 : Fifth Contract Modification with Gafcon)
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Packet Pg. 389 Attachment: Gafcon Contract#10435 agreement and modifications (5833 : Fifth Contract Modification with Gafcon)
5.H.e
Packet Pg. 390 Attachment: Gafcon Contract#10435 agreement and modifications (5833 : Fifth Contract Modification with Gafcon)
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Packet Pg. 391 Attachment: Gafcon Contract#10435 agreement and modifications (5833 : Fifth Contract Modification with Gafcon)
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Packet Pg. 392 Attachment: Gafcon Contract#10435 agreement and modifications (5833 : Fifth Contract Modification with Gafcon)
5.H.e
Packet Pg. 393 Attachment: Gafcon Contract#10435 agreement and modifications (5833 : Fifth Contract Modification with Gafcon)
5.H.e
Packet Pg. 394 Attachment: Gafcon Contract#10435 agreement and modifications (5833 : Fifth Contract Modification with Gafcon)
5.H.e
Packet Pg. 395 Attachment: Gafcon Contract#10435 agreement and modifications (5833 : Fifth Contract Modification with Gafcon)
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Packet Pg. 404 Attachment: Gafcon Contract#10435 agreement and modifications (5833 : Fifth Contract Modification with Gafcon)
Agreement Number 10435 (CCS)
1
THIRD MODIFICATION OF AGREEMENT NO. 10435 (CCS)
This Third Modification of Agreement Number 10435 (CCS) (“Third Modification”),
entered into as of _________________(“Execution Date”), by and between the City
of Santa Monica, a municipal corporation (“City”), and Gafcon (GAFCON) is made
with reference to the following:
RECITALS
A. On or about May 31, 2016, the City and GAFCON entered into Agreement
Number 3142 to provide certified payroll monitoring services for projects subject
to State prevailing wage regulations under City Manager authority (“Original
Agreement”).
B. On or about April 5, 2017, the City and GAFCON entered into a First Modifica-
tion of Agreement Number 10435 (CCS) aka Agreement Number 3142 (“First
Modification”) which increased the total compensation to allow GAFCON to con-
tinue to provide certified payroll monitoring services for an increased number of
projects subject to State prevailing wage regulations.
C. On or about June 12, 2018, the City and GAFCON entered into a Second Modi-
fication of Agreement Number 10435 (CCS) (“Second Modification”) which in-
creased term and the total compensation to allow GAFCON to continue to pro-
vide certified payroll monitoring services for an increased number of projects sub-
ject to State prevailing wage regulations and the additional scope of monitoring
Federal Davis-Bacon Act prevailing wage compliance requirements. The Original
Agreement, First Modification, and Second Modification are referred to collective-
ly herein as “the Agreement.”
D. The City and GAFCON desire to modify the Agreement to extend the contract
term and increase the contract price to pay for the extended term.
TERMS AND CONDITIONS
Now, therefore, the undersigned parties do hereby mutually agree to modify the
Agreement as follows:
1. Section 1 of the Agreement entitled “Term” shall be deleted in its entirety and re-
placed with the following paragraph:
Term. This Agreement begins on the Execution Date and terminates
on June 30, 2023, unless terminated earlier as set forth in the Agree-
ment or extended by the parties in writing.
2. Section 2 of the Agreement entitled “GAFCON Services” shall be modified by
adding the following paragraph:
Additional Services. GAFCON will perform all of the additional ser-
vices (“Additional Services”) described in Exhibit A-3, Scope of Ser-
vices. GAFCON will complete the Additional Services in accordance
DocuSign Envelope ID: EA29B4FB-D0B7-480F-AB11-62C3C614E31E
1/26/2021
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Agreement Number 10435 (CCS)
2
with Exhibit B-3, Budget.
3. Section 4 of the Agreement entitled “Compensation” shall be modified by adding
the following paragraph:
Compensation. The City will compensate GAFCON for the Addition-
al Services in an amount not to exceed $600,000, as set forth in Exhibit
B-3. The total contract price for services pursuant to the Agreement
and this Third Modification shall not exceed $1,500,000.
4. Exhibit A-3 and Exhibit B-3 are attached hereto and incorporated herein by this
reference.
5. Except as expressly modified by this Third Modification, all other terms and con-
ditions of the Agreement shall be and remain in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Third Modification as of
the date and year first written above.
ATTEST:
______________________________
DENISE ANDERSON-WARREN
City Clerk
APPROVED AS TO FORM:
______________________________
LANE DILG
City Attorney
CITY OF SANTA MONICA,
a municipal corporation
By: ______________________________
RICK COLE
City Manager
Gafcon
#VENDOR
By: _______________________________
DocuSign Envelope ID: EA29B4FB-D0B7-480F-AB11-62C3C614E31E
George Cardona
1/14/2021
Interim City Attorney
Chief Financial Officer
Gafcon, Inc.
1/22/2021
James Baum
Interim City Manager
1/26/2021
Lane DilgDenise Anderson-Warren
City Clerk
1/28/2021
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Agreement Number 10435 (CCS)
3
Exhibit A-3
Scope of Services
GAFCON shall provide certified payroll monitoring services for projects subject to
State and Federal prevailing wage regulations. Services will generally consist of per-
forming certified compliance monitoring by electronic review of certified payrolls
submitted by contractors via the State of California’s Department of Industrial Rela-
tions, electronic Certified Payroll Reporting (eCPR) website and the Davis Bacon Act.
The Division coordinator will provide the consultant with a login/password into the
electronic Certified Payroll Reporting (eCPR) website for their Division.
GAFCON shall provide certified payroll compliance monitoring services on various
projects citywide. Consultant’s responsibilities may include but are not limited to the
following:
Task 1 – Assistance in Selection of Classification
Assist in the reviews of scope of work and ensures the proper classification is selected.
Facilitate communication between DIR on behalf of the City when a request for job
classification is needed.
Task 2 – Labor Compliance Technical Assistance During Bidding
Assist in the reviews and responses to requests for information during bidding for
questions related to prevailing wage classifications.
Task 3 – Certified Payroll Review During Construction
Confirm contractors' payment of applicable general prevailing wage rates by review of
hard copy Certified Payroll Reports which are mailed to GAFCON.
Provide a thorough, accurate examination and review of certified payrolls to confirm
the payrolls are complete, accurate, and comply with all statutory and regulatory pre-
vailing wage requirements.
Communicate with contractors when Certified Payroll Reports are missing infor-
mation or are unreadable.
Provide technical assistance to contractors, as needed, to aid in completion of payroll
forms.
Review interview forms provided by the on-site labor interviewer. Follow up if any
employees were found on the job who did not show up in payrolls (ghost workers).
Confirm Contractors' employment of properly registered apprentices. Review and ver-
ifications for apprentices include:
o Department of Apprenticeship Standards (DAS) Form 140
o Department of Apprenticeship Standards (DAS) Form 142
o California Apprentice Council Training Fund Contribution (CAC-2)
o Check Fringe Benefit Statement s and Payroll Authorization for deductions,
discrepancies, omissions or inaccuracies.
DocuSign Envelope ID: EA29B4FB-D0B7-480F-AB11-62C3C614E31E
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Agreement Number 10435 (CCS)
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Exhibit B-3
Budget
The City will compensate GAFCON for the Additional Services described in Exhibit
A-3 in an amount not to exceed $600,000. GAFCON will provide the Additional
Services at the hourly rates below. The total compensation paid to GAFCON for ser-
vices pursuant to the Agreement and this Third Modification shall not exceed
$1,500,000.
TITLE HOURLY RATE
Vice President, Labor Relations $165.00/HR
Labor Compliance Officer $85.00/HR
Field Inspector/Auditor $80.00/HR
Administrative Assistant $58/HR
The City will reimburse GAFCON for out of pocket expenses associated with the pro-
ject, plus an administrative fee equal to fifteen percent (15%) of the expenses. Example
of various expenses not limited to:
Cost of all postage, express shipping, courier services, etc.
Cost of all blueprinting, photo reproducing, and photography for jobsite surveys.
Mileage costs shall be charged at the prevailing IRS rate to and from the Project(s) and
the respective GAFCON office in Los Angeles.
Based on the hourly rates, a rate of $84.20 will be considered an overall hourly staff
billing rate for all services with the exception of additional non-staff charges.
The City agrees to provide annual exempt permits for GAFCON to conduct citywide
labor compliance and certified payroll monitoring services on behalf of the City.
GAFCON agrees to utilize these permits in accordance with City policies and guide-
lines. GAFCON will assume all risks and responsibilities associated with the use of the
exempt permits including parking citations due to misuse of the permits, which may
result in revocation of parking privileges. Revoked permits will not be replaced for the
remainder of the permit year.
DocuSign Envelope ID: EA29B4FB-D0B7-480F-AB11-62C3C614E31E
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Packet Pg. 408 Attachment: Gafcon Contract#10435 agreement and modifications (5833 : Fifth Contract Modification with Gafcon)
10435 (CCS)
1
FOURTH MODIFICATION OF AGREEMENT NO. 10435
This Fourth Modification of Agreement Number 10435 (CCS) (“Fourth Modifica-
tion”), entered into as of _________________, by and between the City of Santa
Monica, a municipal corporation (“City”), and GAFCON INC ("GAFCON”) is made
with reference to the following:
RECITALS
A. On or about^^May 31, 2016, the City and GAFCON entered into Agreement Num-
ber 3142 for citywide labor compliance and certified payroll monitoring services.
(“Original Agreement”).
B. On or about^^April 5, 2017, the City and GAFCON entered into a First Modifica-
tion of the Original Agreement (“First Modification”) which increased the total
compensation to allow GAFCON to continue to provide certified payroll monitor-
ing services for an increased number of projects subject to State prevailing wage
regulations.
C. On or about^^June 12, 2018, the City and GAFCON entered into a Second Modifi-
cation of the Original Agreement (“Second Modification”) which increased total
compensation.
D. On or about^^January 26, 2021, the City and GAFCON entered into a Third Modi-
fication of the Original Agreement (“Third Modification”) which extended the
contract term and increased the contract price to pay for the extended term. The
Original Agreement, First Modification, Second Modification, and Third Modifi-
cation may be referred to collectively herein as “the Agreement.”
E. The City and GAFCON desire to modify the Agreement to extend the Agreement
term by an additional six months. The budget and not-to-exceed limits stated in
Exhibit B-3 of the Third Modification will remain the same.
TERMS AND CONDITIONS
Now, therefore, the undersigned parties do hereby mutually agree to modify the Agree-
ment as follows:
1. Section 1 of the Agreement entitled “Term” shall be deleted in its entirety and re-
placed with the following paragraph:
Term. This Agreement begins on May 31, 2016 and terminates on De-
cember 31, 2023, unless terminated earlier as set forth in the Agree-
ment or extended by the parties in writing.
2. Execution in Counterparts. This Fourth Modification may be executed in coun-
terparts with the same effect as if both parties hereto had executed the same docu-
ment. All counterparts shall be construed together and shall constitute a single
modification. Any signature to this Fourth Modification transmitted electronically
through DocuSign or PDF shall be deemed an original signature and be binding
DocuSign Envelope ID: 510DE139-6CF5-4C77-A078-E1961E32946B
4/10/2023
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10435 (CCS)
2
upon the parties hereto (it being agreed that such electronic signature shall have
the same force and effect as an original signature).
3. Except as expressly modified by this Fourth Modification, all other terms and con-
ditions of the Agreement shall be and remain in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Fourth Modification as of
the date and year first written above.
ATTEST:
______________________________
DENISE ANDERSON-WARREN
City Clerk
APPROVED AS TO FORM:
______________________________
LANE DILG
City Attorney
CITY OF SANTA MONICA,
a municipal corporation
By: ______________________________
RICK COLE
City Manager
GAFCON Corporation
#VENDOR
By: _______________________________
DocuSign Envelope ID: 510DE139-6CF5-4C77-A078-E1961E32946B
DOUGLAS SLOAN
3/30/2023
City Attorney
4/6/2023
Gafcon, Inc.
Robin Duveen
Co-CEO
4/10/2023
David White
City Manager
Denise Anderson-Warren
City Clerk
4/10/2023
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