If you are interested and qualified, please submit five (5) copies of your proposal by 4:00 p.m. December 22, 2017 to:

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1 The Yolo-Solano Air Quality Management District is currently soliciting proposals for contract services for independent auditing services. If you are interested and qualified, please submit five (5) copies of your proposal by 4:00 p.m. December 22, 2017 to: Yolo-Solano Air Quality Management District Attn: Lisa Carpenter 1947 Galileo Court, Suite 103 Davis, CA For questions regarding the proposal process contact Lisa Carpenter at: (530) or

2 The Yolo-Solano Air Quality Management District s Board of Directors requests proposals from certified public accounting firms for the annual examination of its General Purpose Financial Statements for fiscal years ending June 30, 2018 through June 30, The work is to be performed in accordance with applicable standards established by the District. I. General Information The Yolo-Solano Air Quality Management District (District) is a special district which was formed June 28, 1971, by ratification of the Board of Supervisors of Yolo and Solano Counties, under the provisions of Article 7, Chapter 2 of the Health and Safety Code of California. The District is empowered to maintain a program of air quality management under the provisions of Article XI, Section 7, of the Constitution of the State of California, and under the Joint Powers Agreement between the two counties, effective February 10, The District has jurisdiction over all of Yolo County and the northeast portion of Solano County, from Vacaville on the west to Rio Vista on the south. The District is governed by a fourteen (14) member Board of Directors (Board) composed of representatives from both the Yolo and Solano County Board of Supervisors and Mayors/City Council Members from the cities within the District. The Treasurer of Yolo County serves as the District's Treasurer. The Air Pollution Control Officer is the Chief Executive Officer and is appointed by and reports to the Board. The District adheres to the accounting principles, standards, and procedures prescribed by the Government Accounting Standards Board and applied by the State Controller's Office as set forth in the manual on Accounting Standards and Procedures for Special Districts. Currently, the District's accounting information is maintained on Yolo County's mainframe on-line system. Expenditure and revenue detail is broken down by budget units within funds. The system is capable of generating various, detailed accounting reports for both the current year and prior years. It is the District s goal to bring the majority of accounting operations in-house using the QuickBooks program by fiscal year 2019/2020. General Instructions and Conditions A. INQUIRIES/CONTACT All inquiries for this proposal must be in writing and must be delivered to: Lisa Carpenter, Administrative Services Manager Yolo-Solano AQMD 1947 Galileo Court, Suite 103 Davis, CA P: (530) E: lcarpenter@ysaqmd.org Yolo-Solano AQMD Page 1 of 9

3 Requests for interpretation shall be made no later than December 4, 2017, 4:00 p.m. B. AMBIGUITY-CONFLICT OR OTHER ERRORS IN REQUESTS FOR PROPOSAL If a bidder discovers any ambiguity, conflict, discrepancy, omission, or other error in the RFP, the bidder shall immediately notify the District of such an error and request such modification or clarification of the document. Modifications will be made by issuing a revision and will be given by written notice to all parties who have been furnished the RFP. If a bidder fails to notify the District prior to December 4, 2017, of an error that reasonably should have been known, the proposal shall be submitted at the bidder's own risk and if awarded, the contractor shall not be entitled to additional compensation or timely reason of the error or its latter correction. The District may also modify the RFP prior to the date and time fixed for submission of proposals by issuance of a revision to all parties who have received the RFP. C. SUBMISSION OF PROPOSAL 1. Number of Copies: Five (5) copies of the proposal must be submitted. 2. Signature of Proposal: Each bid shall be considered an integral part of the proposal and shall be signed by an individual who is authorized to bind the bidder contractually. 3. Representations: All representations made by a bidder in its proposal shall be considered material and binding on the bidder, and shall be incorporated into any contract between the District and that bidder, if that bidder is offered a contract by the District. 4. Conditions: a. No proposals will be accepted after the time and date indicated. b. Incomplete responses will not be accepted. c. All components of the proposal are mandatory. d. Failure to include all requested information may result in rejection. D. DELIVERY OF PROPOSALS All proposals become the property of the District and will not be returned to the bidders. E. WITHDRAWAL OF PROPOSAL At any time prior to the proposal submittal deadline, the bidder may withdraw a proposal by submitting a written request for its withdrawal to Lisa Carpenter, Administrative Services Manager, and signed by the bidder or an authorized agent at any time prior to the proposal submission deadline. The bidder may thereafter submit a new proposal prior to the deadline. Modifications offered in any manner, oral or written, will not be considered after the deadline. Yolo-Solano AQMD Page 2 of 9

4 F. LIMITATION This RFP does not commit the District to award a contract, to pay any costs incurred in the preparation of proposals, or to procure or contract for services or supplies. Costs for developing proposals are entirely the responsibility of the respondent and shall not be chargeable to the District. The District may utilize evaluation criteria and selection processes set forth below at its discretion but shall not be bound by such provisions. G. ERRORS AND OMISSIONS COVERAGE The District reserves the right to require the selected parties to provide evidence of liability insurance, including errors and omissions coverage, in an amount to be determined by the District. H. TENTATIVE SCHEDULE OF EVENTS The following time line will guide this RFP process. The due date for all proposals is firm. The other dates are tentative and subject to change. Release of RFP to Interested Parties November 20, 2017 Deadline for Requests for Interpretation December 4, 2017, by 4:00 p.m. Proposals Due December 22, 2017, by 4:00 p.m. Completion of Evaluation January 31, 2018 Notification of Tentative Selection February 1, 2018 Interviews February 19-23, 2017 (week of) Execution of Contract March 1, 2018 I. TIMETABLE OF AUDIT The District reserves the right to waive these dates in the event of extenuating circumstances. 1. Auditing firm shall have prepared by client letter to the District by July 1st of each contract year. 2. Audit field work shall be conducted no later than the first week of October (approximately) of each contract year. 3. The report of examination of financial statements shall be issued by November 30th of each contract year (Example: The statements shall be issued by November 30, 2018 for fiscal year 2017/2018). The compliance report and management letter shall be issued within sixty (60) days of completion of the audit. II. What to Include in Your RFP Response The District's goal in this RFP process is to identify the respondent with the best experience and capabilities to provide the services as described under Scope of Examination, Section IV. The format of the proposal submitted by your firm shall specifically address and coincide with the following requirements. Yolo-Solano AQMD Page 3 of 9

5 A. TITLE PAGE Show the RFP subject, the name of the proposer's firm, address and telephone number of the firm's office in or nearest Davis, California, name of the contact person, and the date submitted. B. TABLE OF CONTENTS Include a clear identification of the material by section and by page number. C. LETTER OF TRANSMITTAL Limit to one (1) or two (2) pages. 1. Briefly state the proposer's understanding of the work to be done and make a positive commitment to perform the work within the time prescribed. 2. State the names of the persons who will be authorized to make representations for the proposer, their titles, addresses and telephone numbers. 3. State that the person signing the letter will be authorized to bind the proposer. D. PROFILE OF FIRM 1. State whether the firm is local, regional, national or international. 2. State the location of the office from which the work is to be done and the number of partners, managers, supervisors, seniors and other professional staff employed at that office. 3. Describe the local office's capability to audit computerized systems, including the number and classifications of personnel skilled in computer sciences who will work on the audit. E. SUMMARY OF PROPOSER S QUALIFICATIONS 1. Identify the partners, managers, and supervisors who will work on the audit, including staff from other than the local office. Resumes including relevant experience and continuing education for each person assigned to the audit should be included. (The resumes may be included as an appendix.) 2. A statement of your firm's background and experience in providing auditing and management consulting services to governmental agencies. F. REFERENCES 1. Describe the most recent local and regional office auditing experience similar to the type of audit requested, and give the names and telephone numbers of client officials responsible for three (3) of the audits listed. (See Attachment A for reference format). The services must demonstrate your firm's ability to meet the District's needs as described in this RFP. 2. The District may contact references at any time, either before or after a Yolo-Solano AQMD Page 4 of 9

6 respondent is selected. The Air Pollution Control Officer (APCO) may reverse the selection decision and award the contract to another respondent based upon post-award reference check. G. A declaration of your firm's ability and willingness to commit and maintain staffing, both number and level, to successfully conclude the engagement. H. Policy regarding change in personnel. In addition, the firm's ability to rotate field personnel during each contract year. I. A statement of the education and training program provided to or required of the staff identified for participation in the engagement, particularly with reference to governmental accounting and auditing, governmental practices and procedures, and governmental affairs. J. A statement of arrangements your firm has with regard to liaison with or access to offices of the state and federal governments for the purpose of obtaining a prompt response to inquiries arising from technical or procedural questions developed in the course of the examination. K. A statement as to whether the firm is independent as defined by applicable auditing standards. L. A statement as to whether the local office that would be in charge of the audit has been given a positive peer review and whether they have been the object of any disciplinary actions during the past three (3) years. M. Based on the Scope of the Examination, indicate the rate of pay and the amount not to exceed for which you can successfully complete the services as described in section "Scope of Examination," Section IV. Include the total estimated hours, hourly rate for each staff classification, and the maximum fee to be charged for the engagement. Specify whether this is a reduced rate for public entity clients. N. A statement acknowledging that if your firm is awarded a contract you will retain the audit work papers and related audit reports for a minimum of five (5) years and understand that staff of the agency is authorized to review any and all work papers. O. An expression of your estimated space and equipment requirements. State the maximum number of desks/locations that you would need on site at the District, including length of time. P. An expression of your estimated requirements on the use of the District staff to provide you with schedules. Q. An expression of your ability to accomplish this engagement during the District s normal office hours. Yolo-Solano AQMD Page 5 of 9

7 R. Any other information considered relevant to the proposal including a statement that the proposal will remain valid for ninety (90) days. S. If your firm intends to subcontract for segments of the engagement, your proposal shall be specific as to detail. III. Evaluation Criteria & Selection Process A. All proposals will be reviewed by an evaluation committee consisting of one or more representatives from the District and may include persons from the District's Budget and Audit Committee, and representatives from other governmental agencies. B. Upon completion of review, the evaluation committee will make a tentative selection and set up an interview with representatives of the firm selected to formalize the contract. It is the District's intention to incorporate the RFP as part of the contract. Upon completion of the interview the Committee will make a formal recommendation to the Board of Directors. The Board will make the final selection and award the bid. C. CRITERIA FOR EVALUATIONG RESPONSES WILL INCLUDE: 1. Relevant experience and qualifications. 2. Cost, although a significant factor, may not be the determining factor. Cost is particularly important when all the other evaluation criteria are relatively equal. 3. Reputation of customer satisfaction (references). D. RIGHT OF REJECTION The District reserves the right to reject any and all proposals submitted and/or to request additional information from proposers. The District may also reverse the selection decision and award the contract to another respondent based upon a post-award reference check. IV. Scope of Examination A. GENERAL PURPOSE FINANCIAL STATEMENTS 1. The intent of the District is for the auditor to render an opinion on its General Purpose Financial Statements and accept responsibility for the statements in relation to the General Purpose Financial Statements. 2. The funds and account groups included in the examination are all funds governed by the District Board of Directors and/or under the fiduciary responsibility of the Yolo County Treasury (i.e. included in the District's investment pool). 3. The audit shall be conducted in accordance with Generally Accepted Government Auditing Standards. As such, the auditor shall issue a report on internal control over financial reporting and on compliance and other matters. Yolo-Solano AQMD Page 6 of 9

8 4. Traditional end-of-year verifications (cash counts) for the fiscal years ending June 30, 2018, 2019, and The District s intention regarding the funds and account groups referenced in Section IV.A.2 above is to comply with the National Council of Governmental Accounting Statement No. 3. B. ERRORS AND IRREGULARITIES If conditions are discovered which lead to the belief that material errors, defalcations, or other irregularities may exist, or if any other circumstances are encountered that require extended services, the auditors will promptly advise the District. No extended services will be performed unless they are authorized in a contractual agreement or in an amendment to the agreement. C. REPORT ON EXAMINATION OF FINANCIAL STATEMENT 1. These reports (General Purpose Financial Statements) shall set forth the scope of the examination together with an opinion in compliance with Rule 58.1 of the State Board of Accountancy. 2. The report shall include the financial statement customarily associated with reports on funds of governmental units. 3. The report shall be addressed to: Yolo-Solano Air Quality Management District 1947 Galileo Court, Suite 103 Davis, CA Five (5) hard copies of the auditor s report shall be delivered to the District. Distribution will be made by the District, and one (1) electronic copy shall be sent to the Administrative Services Manager. 5. A meeting between the District's Budget and Audit Committee (representatives from the Board of Directors) and the auditing firm will be scheduled to review the financial report. A representative from the auditing firm will also be available for the January Board of Directors' meeting to answer questions of the audit for the full Board. D. MANAGEMENT LETTER In addition to submitting a report on the examination of the financial statements, a management letter shall be prepared setting forth the following format. 1. Findings and recommendations for improvement resulting from the survey of internal control conducted as part of the examination. 2. Findings and recommendations for improvement in accounting systems where Yolo-Solano AQMD Page 7 of 9

9 noted during the conduct of the examination. 3. Findings of noncompliance with laws, rules, and regulations coming to the attention of the firm during the course of the examination. 4. Any material items coming to the attention of the firm during the conduct of the examination. 5. If there were no findings or recommendations, this shall also be reported to the Budget and Audit Committee by submittal of a Management Letter. 6. The Management Letter shall be addressed to: Budget and Audit Committee Yolo-Solano Air Quality Management District 1947 Galileo Court, Suite 103 Davis, CA Five (5) hard copies of the Management Letter shall be delivered to the District. Distribution will be made by the District, and one (1) electronic copy shall be sent to the Administrative Services Manager. V. District Support & Assistance Preliminary to and throughout the engagement, the District proposes to make available personnel to provide assistance for tasks such as identifying locations of required records and documentation, gathering needed records and supporting information, and, limited to available staff time, such other tasks that will expedite the conduct of the engagement. VI. Payment of Fees A. Compensation for work performed shall be paid on the basis of monthly invoices submitted and approved by the Administrative Services Manager, less 10% retention per invoice. Each invoice shall set forth the staff level and hours of persons rendering services during the invoice period. The 10% retention shall be paid upon acceptance by the Administrative Services Manager as to form and compliance with applicable standards and acceptance by the Board of Directors of all required reports and letters for the fiscal year in question. The contractor will be liable for damages for delinquent reports and non-compliance with applicable auditing standards. B. Federal Income Tax Law requires the District to file information returns for "services rendered" by certain individuals and others. The code provides that the Tax Payer Identification Number of the "payment recipient" (you) must be furnished upon request to the "service recipient" (us). In order to help the District comply with reporting requirements, and to protect your firm from withholding or penalty, the selected vendor will be required to complete and submit to the District a W-9 form prior to any work commencing. Yolo-Solano AQMD Page 8 of 9

10 VII. Additional Information & Requirements A. Other records and financial data necessary for the preparation of your proposal and subsequent audit, including prior years audit reports and management letters, will be made available by the District upon your request. B. LITIGATION INVOLVEMENT All respondents must complete Attachment B. C. ASSURANCE AND CERTIFICATION All respondents must complete Attachment C. D. CONTRACT It is understood that the successful respondent will enter into a service contract with the District. A sample contract is included in this RFP as Attachment D. All proposed changes to the contract must be submitted with the proposal. Yolo-Solano AQMD Page 9 of 9

11 Attachment A REFERENCES Respondents must provide references from three (3) organizations that are or have received similar services. A brief description of services rendered, in addition to name, address, telephone number and contact person must be provided. Proponents may include letters of reference with this attachment. The following format shall be used: Date of Service(s): Name of Organization: Address: Phone: Contact Person: Description of Service: Yolo-Solano AQMD Page 1 of 1

12 Attachment B LITIGATION INVOLVEMENT Organization Name and Address: Involvement in Litigation: Check YES or NO to the following questions. If a YES answer is checked, please explain fully the circumstances and include discussion of the type of program involved as well as the potential impact on this program, if awarded contract (use extra pages as needed). 1. Is the firm or any of its principles involved in litigation now or within the last two years? Yes No 2. Has the firm or Project Director ever been cited for improper management? Yes No 3. Has the firm or Project Director ever had public agency funds withheld? Yes No Completed by: Name and Title Yolo-Solano AQMD Page 1 of 1

13 Attachment C ASSURANCE AND CERTIFICATION I, (We), the undersigned, as duly authorized representative(s) of the respondent agency, affirm that the information and statements contained within this proposal to the best of my (our) knowledge, are truthful and accurate, and further, that I (we) am (are) duly authorized to submit this proposal from the respondent agency to deliver services. Signature Date Signature Date Yolo-Solano AQMD Page 1 of 1

14 Attachment D AGREEMENT NO. 18-XX Agreement between the Yolo-Solano Air Quality Management District and (Qualified Firm) THIS AGREEMENT ("Agreement") is made effective (date) between the Yolo-Solano Air Quality Management District, a public agency of the State of California, hereinafter referred to as "DISTRICT," and, (describe legal status, e.g. a California corporation; a Delaware corporation authorized to do business in this State and County; Alma Doe, and individual doing business as AD Enterprises and authorized to do business in this County; a California limited liability company; a California partnership consisting of general partners Maria Doe and John Smith and various limited partners, etc.), hereinafter referred to as "CONTRACTOR." RECITALS WHEREAS, annual financial statements are required of special districts under California Government Code Section 26909; and WHEREAS, on November 20, 2017, the DISTRICT released a formal seeking proposals from certified public accounting firms for the annual audit of its General Purpose Financial Statements for fiscal years ending June 30, 2018, 2019, and 2020; and WHEREAS, was selected as the most qualified respondent; and WHEREAS, DISTRICT desires to engage in professional assistance in order to provide auditing services to the DISTRICT; and WHEREAS, services; and is a professional firm who is well qualified by education and experience to provide such WHEREAS, is ready, willing and able to provide the DISTRICT with the required auditing services, subject to the terms and conditions of this Agreement; NOW THEREFORE, the parties agree as follows: A. SCOPE OF SUPPORT AND SERVICES CONTRACTOR shall provide support and services of the description and scope specified in Exhibit A attached hereto and incorporated herein by reference. B. TERM OF AGREEMENT 1. This Agreement shall be for the term beginning March 1, 2018, and ending December 31, and Yolo-Solano AQMD Page 1 of 8

15 Attachment D 2. The DISTRICT, in its sole discretion, may elect to extend this Agreement for an additional two (2) one (1) year periods, beginning January 1, 2021 and ending December 31, 2022, on the same terms and conditions and for the same rate of compensation as specified herein, and CONTRACTOR hereby agrees to perform this Agreement during the extended term, should the DISTRICT so elect. Written notice of extension shall be given to the CONTRACTOR no later than thirty (30) days prior to the termination date. C. COMPENSATION The payments outlined in Exhibit B, attached hereto and incorporated herein by reference, shall be made to CONTRACTOR by DISTRICT so long as the CONTRACTOR is providing the services as set forth in Exhibit A in a satisfactory manner, as determined solely by the DISTRICT. D. APCO As used in this Agreement, "APCO" shall mean the Air Pollution Control Officer of the DISTRICT, or his or her designee. E. INDEMNIFICATION CONTRACTOR shall indemnify, defend and hold harmless the DISTRICT, its officers, employees, agents, trustees and volunteers from and against all claims, losses, damages, liability, and expenses (including attorney fees) caused in whole or in part by any act or omission of the CONTRACTOR, regardless of whether or not it is caused in part by a party indemnified hereunder, or arising out of or alleged to arise out of the obligations and responsibility imposed on the CONTRACTOR by this Agreement. In providing any defense, CONTRACTOR shall use legal counsel acceptable to the APCO and DISTRICT COUNSEL. This indemnification requirement shall survive the termination or expiration of this Agreement. F. INSURANCE Without limiting CONTRACTOR's indemnification in Section 5 above, CONTRACTOR shall maintain in force at all times during the term of this Agreement and any extensions or modifications thereto, insurance or self-insurance covering its operations. The types of insurance to be secured, its specifications and the amount of coverage shall be as stated in Exhibit C attached hereto and incorporated herein by this reference. G. STATUS OF CONTRACTOR 1. It is understood and agreed by all the parties hereto that CONTRACTOR is an independent contractor and that no relationship of employer-employee exists between the DISTRICT and CONTRACTOR. Neither CONTRACTOR nor CONTRACTOR's assigned personnel shall be entitled to any benefits payable to employees of the DISTRICT. CONTRACTOR hereby indemnifies and holds the DISTRICT harmless from any and all claims that may be made against the DISTRICT based upon any contention by any third party that an employer-employee relationship exists by reason of this Agreement. and Yolo-Solano AQMD Page 2 of 8

16 Attachment D 2. It is further understood and agreed by the parties hereto that CONTRACTOR in the performance of its obligation hereunder is subject to meeting the standards of the accounting profession as set out by the American Institute of Certified Public Accounts (AICPA) and the California State Board of Accountancy (SBA). 3. It is further understood and agreed by all the parties hereto that neither CONTRACTOR nor CONTRACTOR's assigned personnel shall have any right to act on behalf of the DISTRICT in any capacity whatsoever as an agent or to bind the DISTRICT to any obligation whatsoever. 4. It is further understood and agreed by all the parties hereto that CONTRACTOR must issue any and all forms required by federal and state laws for income and employment tax purposes, including W-2 and 941 forms, for all of CONTRACTOR's assigned personnel. H. APPLICABLE LAWS CONTRACTOR shall comply with all applicable federal, state, and DISTRICT statutes, ordinances, regulations, directives and laws. This Agreement shall be deemed to be executed within the State of California and construed in accordance with and governed by the laws of the State of California. Any action or proceeding arising out of this Agreement shall be filed in a California State court located in Woodland, California. I. AUDIT OF RECORDS 1. CONTRACTOR shall keep all necessary books and records in connection with the work performed under this Agreement in order that DISTRICT staff may properly audit all expenditures made pursuant hereto. CONTRACTOR further agrees that DISTRICT staff shall have access, at all reasonable times, to the books, records, and accounts kept by CONTRACTOR in connection with all monies expended under this Agreement, for purpose of making an audit of all expenditures made by CONTRACTOR in the performance of this Agreement. 2. During the period of this Agreement and continuing for five (5) years after expiration or termination of this Agreement, CONTRACTOR shall retain such records as may be necessary for an audit of the work performed, expenditures made pursuant to this Agreement and an accounting of funds for this Agreement. Upon written request, CONTRACTOR shall retain or surrender said records for such additional time as may be necessary to satisfy auditing reviews or litigation schedules which may be in progress at the time that the records retention requirements would have expired. At least thirty (30) calendar days prior to any destruction of these records at any time, CONTRACTOR shall notify the APCO. Upon such notification, the APCO shall either agree to the destruction or authorize the records to be forwarded to the DISTRICT office for further retention. and Yolo-Solano AQMD Page 3 of 8

17 Attachment D J. NON-DISCRIMINATION IN SERVICES AND BENEFITS CONTRACTOR certifies that any service provided pursuant to this Agreement shall be without discrimination based on color, race, creed, national origin, religion, sex, age, sexual preference or physical or mental handicap in accordance with Title VI of the Civil Right Act of 1964, 42 U.S.C. Section 2000d, rules and regulations promulgated pursuant thereto, or as otherwise provided by state and federal law; nor on the basis of sexual preferences as determined by federal, state, or DISTRICT regulations; except as may be required by federal, state or DISTRICT regulations or other administrative directives established by the DISTRICT Board of Directors or the APCO. For the purpose of this Agreement, distinctions on the grounds of color, race, creed, national origin, religion, sex, age, sexual preference, or physical or mental handicap include but are not limited to the following: denying a participant any service or benefit to a participant which is different, or is provided in a different manner or at a different time from that provided to other participants under this Agreement; subjecting a participant to segregation or separate treatment in any way in the enjoyment or any advantage or privilege enjoyed by others receiving any service or benefit; treating a participant differently from others in determining whether the participant has satisfied any admission, enrollment quota, eligibility, membership, or other requirement or condition which individuals must meet in order to be provided any service or benefit; and the assignment of times or places for the provision of services on the basis of race, color, creed, or national origin of the participants to be served. K. WAIVER The waiver by the DISTRICT or any of its officers, agents or employees, or the failure of the DISTRICT or its officers, agents or employees to take action with respect to any right conferred by, or any breach of any obligation or responsibility of this Agreement shall not be deemed to be a waiver of such obligation or responsibility, or subsequent breach of same, or of any terms, covenants or conditions of this Agreement. L. CONFLICT OF INTEREST 1. CONTRACTOR shall comply with the laws and regulations of the State of California and DISTRICT regarding conflicts of interest, including, but not limited to, Article 4 of Chapter 1, Division 4, Title 1 of the California Government Code, commencing with Section I 090, and Chapter 7 of Title 9 of said Code, commencing with Section including regulations promulgated by the California Fair Political Practices Commission. 2. CONTRACTOR covenants that it presently has no interest and shall not acquire any interest, direct or indirect, which would conflict in any manner or degree with the performance of CONTRACTOR's obligations and responsibilities hereunder. CONTRACTOR further covenants that in the performance of this Agreement, no person having any such interest shall be employed. This covenant shall remain in force until CONTRACTOR completes performance of the obligations and responsibilities required of it under this Agreement. and Yolo-Solano AQMD Page 4 of 8

18 Attachment D 3. CONTRACTOR agrees that if any fact comes to its attention which raises any question as to the applicability of any conflict of interest law or regulation, CONTRACTOR will immediately inform the DISTRICT and provide all information needed for resolution of the question. M. NO ASSIGNMENT OR SUB-CONTRACTING None of the services to be rendered pursuant to this Agreement may be assigned or subcontracted. N. AMENDMENT This Agreement may be amended only by written instrument signed by the DISTRICT and CONTRACTOR. O. TERMINATION 1. Either party shall have the right to terminate this Agreement upon the giving of thirty (30) days written notice to the other party; provided, however, that this shall not relieve either party of any liabilities incurred prior to the date of the notice. 2. DISTRICT, through its APCO, may terminate this Agreement upon a five (5) day written notice served upon the CONTRACTOR if CONTRACTOR fails to perform any of the covenants contained in the Agreement in the time and manner specified. In the event of such termination, DISTRICT may proceed with the work in any manner deemed proper by DISTRICT without recourse by CONTRACTOR, its officers, agents, employees or volunteers. 3. DISTRICT, through its APCO, may terminate or amend this Agreement immediately upon written notice served upon the CONTRACTOR if advised that funds are not available from external sources for this Agreement or for any portion hereof, or if funds are not specifically appropriated for this Agreement in the District's final budget for the years this Agreement or any extensions thereto are in effect. P. NOTICES 1. All notices shall be deemed to have been given when made in writing and delivered or mailed to DISTRICT and CONTRACTOR at their respective addresses as follows: To DISTRICT: Yolo-Solano Air Quality Management District Attn: APCO 1947 Galileo Court, Suite I 03 Davis, CA To CONTRACTOR: Contractor s Name Attn: and Yolo-Solano AQMD Page 5 of 8

19 Attachment D 2. In lieu of written notice to the above addresses, any party may provide notices through the use of facsimile machines provided confirmation of delivery is obtained at the time of transmission of the notices and provided the following facsimile telephone numbers are used: To DISTRICT: (530) To CONTRACTOR: ( _) _ - 3. Any party may change the address or facsimile number to which such communications are to be given by providing the other parties with written notice of such change at least fifteen (15) calendar days prior to the effective date of the change. 4. All notices shall be effective upon receipt and shall be deemed received through delivery if personally served or served using facsimile machines, or on the fifth (5th) day following deposit in the mail if sent by first class mail. Q. FACILITIES AND SUPPORT DISTRICT shall provide such work space, office facilities, and support services to CONTRACTOR during this Agreement as are deemed necessary by the APCO for the purpose of accomplishing the work provided herein. Direct costs incurred by CONTRACTOR shall be paid by CONTRACTOR, and CONTRACTOR shall not demand nor shall the DISTRICT pay any expenses, fees, or monies not expressly provided for in the Agreement or approved in writing, in advance, by the APCO. R. RIGHTS TO CONTRACTED PRODUCTS 1. All products prepared by CONTRACTOR pursuant to this Agreement, but not including CONTRACTOR's administrative communications and records, shall be delivered to and become the exclusive property of the DISTRICT and may be used in its entirety by the DISTRICT in any way it may deem appropriate. 2. The ideas, concepts, know-how, or techniques developed during the course of this Agreement by CONTRACTOR or jointly by CONTRACTOR and the DISTRICT can be used by either party in any way deemed appropriate by either of them. S. DISPUTES Any dispute arising under this Agreement shall be decided by the APCO who shall put his or her decision in writing and mail a copy thereof to the address for the notice to CONTRACTOR. The decision of the APCO shall be final unless within thirty (30) days from the date such copy is mailed to CONTRACTOR and CONTRACTOR appeals the decision in writing to the DISTRICT Board of Directors. Any such written appeal shall detail the reasons for the appeal and contain copies of all documentation supporting CONTRACTOR's position. and Yolo-Solano AQMD Page 6 of 8

20 Attachment D In connection with any appeal proceeding under this paragraph, CONTRACTOR shall be afforded the opportunity to be heard and offer evidence in support of its appeal to the DISTRICT Board at a regular Board meeting. Pending a final decision of the dispute, CONTRACTOR shall proceed diligently with the performance of this Agreement and in accordance with the APCO's decision. The decision of the DISTRICT Board of Directors on the appeal shall be final. T. AUTHORIZED REPRESENTATIVE The person executing this Agreement on behalf of CONTRACTOR affirmatively represents that he or she has the requisite legal authority to enter into this Agreement on behalf of CONTRACTOR and to bind CONTRACTOR to the terms and conditions of this Agreement. Both the person executing this Agreement on behalf of CONTRACTOR and CONTRACTOR understand that the DISTRICT is relying on this representation in entering into this Agreement. U. PARAGRAPH TITLES The paragraph titles, numbers and alpha characters in this Agreement are inserted only as a matter of convenience and for reference, and in no way define, limit, or describe the scope or intent of this Agreement or in any way affect this Agreement. V. EXTENT OF CONTRACTUAL DOCUMENTS This Agreement shall consist of this basic document and the following exhibits attached hereto and incorporated into this Agreement: Exhibit "A" - Scope of Support and Services Exhibit "B" - Compensation Exhibit "C" - Insurance Requirements Exhibit Exhibit "D" - Contractor's Proposal W. ENTIRE AGREEMENT This Agreement constitutes the entire agreement between the DISTRICT and CONTRACTOR and supersedes all prior negotiations, representations, or agreements, whether written or oral. In the event of a dispute between the parties as to the language of this Agreement or the construction or meaning of any term hereof, this Agreement shall be deemed to have been drafted by the parties in equal parts so that no presumptions or inferences concerning its terms or interpretation may be construed against any party to this Agreement. X. SEVERABILITY If any provision of this Agreement is held invalid or unenforceable, its invalidity or unenforceability shall not affect any other provisions of this Agreement and this Agreement shall be construed and enforced as if such provision had not been included. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written. and Yolo-Solano AQMD Page 7 of 8

21 Attachment D Yolo-Solano Air Quality Management District "DISTRICT" By Mat Ehrhardt, P.E. Executive Director/ Air Pollution Control Officer "CONTRACTOR" By Title Approved as to Form: By Hope Welton, District Counsel and Yolo-Solano AQMD Page 8 of 8

22 Exhibit A EXHIBIT A SCOPE OF SUPPORT AND SERVICES A. STANDARDS The examination of the DISTRICT's General Purpose Financial Statements shall be conducted in accordance to Generally Accepted Auditing Standards and shall be the financial type described in the American Institute of Certified Public Accountants (AICPA) Industry Guide, Auditor of State and Local Governmental Units, SOP 80-2, Accounting and Financial Reporting by Governmental Units, and the Governmental Accounting and Financial Reporting Standards published by the Government Finance Officers Association, leading to an expression of an opinion as required by Rule 58-1 of the State Board of Accountancy. The parties to this Agreement understand that under general accepted governmental auditing standards the independent auditor has the responsibility, within the inherent limitations of the auditing process, to plan the examination to search for errors or irregularities (as defined in authoritative professional literature) that would have a material effect on the financial statements. A search for material errors or irregularities ordinarily is accomplished by performing those auditing procedures that in the CONTRACTOR's judgement are appropriate in the circumstances to form an opinion on the financial statements taken as a whole. The CONTRACTOR's examination, which is based on the concept of selective testing of the data being examined, is subject to the inherent risk that material errors or irregularities, if they exist, will not be detected. In conducting the examination, CONTRACTOR will be aware of the possibility that illegal acts (as defined in authoritative professional literature) may have occurred that may have a material effect on the financial statements. Examinations conducted in accordance with generally accepted auditing standards are of limited effectiveness in discovering possible illegal acts and cannot be expected to provide assurance that illegal acts will be detected, although procedures that are performed for the purpose of forming an opinion on the financial statements as a whole may also bring possible illegal acts to DISTRICT's attention. CONTRACTOR's responsibility is limited to the periods covered by the CONTRACTOR's examinations and does not extend to matters that might arise during any later periods for which CONTRACTOR is not engaged. The foregoing provisions are not intended to relieve CONTRACTOR from its obligation to use due care and exercise reasonable judgement in the fulfillment of its obligation to DISTRICT. B. WORK TO BE PERFORMED The work to be performed shall consist of audits of and reports regarding the accounts and funds of the DISTRICT. Specifically the audit work to be performed shall include: and Yolo-Solano AQMD Page 1 of 3

23 Exhibit A 1. Annual examination of the DISTRICT's General Purpose Financial Statements for fiscal years ending June 30, 2018, 2019, and The funds and account groups included in the examination are all funds governed by the Board of Directors and/or under the fiduciary responsibility of the Yolo County Treasurers (i.e. included in the County's investment pool). The examination shall enable CONTRACTOR to express an opinion, as required by Rule 58-1 of the State Board of Accountancy, on DISTRICT's financial statements and whether DISTRICT has complied with laws and regulations that may have a material effect on each major funding program. 2. Audit procedures which will include tests of documentary evidence supporting the transactions recorded in the accounts, and may include tests of the physical existence of inventories, if any and direct confirmation of receivables and certain other assets and liabilities by correspondence with selected individuals, creditors, financial institutions and others. CONTRACTOR may request an audit letter from the DISTRICT's attorney(s) as part of this engagement. At the conclusion of each audit, CONTRACTOR will also request certain written representations from the DISTRICT about the financial statements and related matters. C. AUDIT PERSONNEL DISTRICT will require the following on a yearly basis: 1. Names of key individuals to be assigned to the engagement in the respective specialties considered necessary to undertake and complete the examination, together with a statement of the qualifications of the key individuals so identified, including their experience in auditing governmental units, auditing in general, and any specialized expertise such individuals might have which is applicable to this engagement. 2. Schedule of field work and expected deadlines. 3. Notification of change in personnel during the engagement. 4. To the extent possible, field personnel shall rotate each contract year. D. REPORTS 1. Progress Reports. CONTRACTOR shall make preliminary findings and a draft audit report and financial statements available to the APCO and Administrative Services Manager (ASM), at least one week prior to finalizing engagement. The CONTRACTOR shall notify the APCO in writing within two business days of discovery. and Yolo-Solano AQMD Page 2 of 3

24 Exhibit A 2. Audit Reports. General: Said audits shall be completed and reports thereon furnished at the mutually agreed date of December 31st for each contract year. Provided, however, that delay attributable to DISTRICT's failure to provide CONTRACTOR with necessary information shall not be included in calculating the foregoing periods. The reports shall be addressed to the Budget and Audit Committee and District Board Members and furnished, together with five (5) hard copies and one (1) electronic copy, thereof, to the DISTRICT office. 3. Report on Examination of Financial Statements: CONTRACTOR shall issue reports of the General Purpose Financial Statements setting forth the scope of the examinations together with an opinion in compliance with Rule 58-1 of the State Board of Accountancy. The report shall include financial statements customarily associated with reports on funds of governmental units. CONTRACTOR shall present reports to the DISTRICT's Audit Committee (representatives from the Board of Directors). 4. Management Report: CONTRACTOR shall submit a management letter setting forth: (a) Findings and recommendations for improvement resulting from the survey of internal control conducted as part of the examination; (b) Findings and recommendations for improvement in accounting systems where noted during the conduct of the examination; (c) Findings of noncompliance with laws, rules and regulations coming to the attention of the CONTRACTOR during the course of the examination; and (d) Any material items or reportable conditions coming to the attention of the firm during the conduct of the examination. However, it is recognized that an audit conducted in conformity with generally accepted auditing standards is not specifically designed and cannot be relied on to disclose reportable conditions, that is, significant deficiencies in the design or operation of the internal control structure. E. DISTRICT SUPPORT AND ASSISTANCE Preliminary to and throughout the engagement the DISTRICT shall provide the basic information required for the audit and make limited availability of personnel to provide assistance for tasks such as identifying locations of required records and documentation, gathering needed records and supporting documentation not readily accessible to CONTRACTOR, and limited to available staff time, such other tasks that will expedite the conduct of the engagement. The DISTRICT is responsible for the accuracy and completeness of information and records provided to CONTRACTOR during the examination. CONTRACTOR will advise the DISTRICT about appropriate accounting principles and their application, and will assist in the preparation of the financial statements, but the responsibility for the financial statements remains with the DISTRICT. This responsibility includes the maintenance of adequate records and related internal control structure policies and procedures, the selection and application of accounting principles, and the safeguarding of assets. and Yolo-Solano AQMD Page 3 of 3

25 Exhibit B EXHIBIT B COMPENSATION The following payments shall be made to the CONTRACTOR by DISTRICT so long as the CONTRACTOR has performed the support and services set forth in Exhibit A. A. TOTAL COMPENSATION Paragraph I, notwithstanding, the total compensation to CONTRACTOR under this Agreement shall not exceed the following sums: Audit for Year Ending: Total Compensation: June 30, 2018 $ June 30, 2019 $ June 30, 2020 $ CONTRACTOR shall receive no reimbursement for any expenses of any kind. B. Any material extension or change in the scope of work requested by DISTRICT or brought about by circumstances that may arise during the course of the engagement shall be discussed with DISTRICT and the resulting fee mutually agreed upon prior to the conduct of the additional work. C. INVOICES Each invoice shall detail the services provided as well as the staff level and hours of persons rendering services during the invoice period. Said compensation shall be paid on the basis of monthly invoice, if applicable, less a 10% retention per invoice, submitted by CONTRACTOR to: Administrative Services Manager Yolo-Solano Air Quality Management District 1947 Galileo Court, Suite 103 Davis, CA The 10% retention shall be paid upon acceptance by the ASM as to form and compliance with applicable standards and acceptance by the Board of Directors of all required reports and letters for the fiscal year in question. Notwithstanding this 10% retention and consistent with the indemnification provisions set forth herein, CONTRACTOR shall be liable for all costs, expenses and damages incurred by the DISTRICT that result from the CONTRACTOR's failure to submit timely reports or from CONTRACTOR's nonobservance of all applicable generally accepted accounting principles and/or generally accepted auditing standards. D. CONTRACTOR shall keep complete detailed records of the time expended by each member of CONTRACTOR's staff engaged in the audit and shall provide DISTRICT with a summary of actual audit hours expended on each grant/program to enable DISTRICT to allocate audit costs to grants/program. and Yolo-Solano AQMD Page 1 of 1

26 Exhibit C EXHIBIT C INSURANCE REQUIREMENTS CONTRACTOR shall furnish the DISTRICT with certificate(s) of insurance or self-insurance and/or original endorsement(s) and/or insurance hinder(s) affecting coverage required below. The certificates, endorsements, and/or hinders for each insurance policy are to be signed by a person authorized by the insurer to effect coverage on its behalf. The certificates, endorsements, and/or binders are to be received and approved by the DISTRICT before work commences. The DISTRICT reserves the right to require complete, certified copies of all required insurance policies, at any time. If CONTRACTOR provides self-insurance, it shall, on intervals specified by the APCO, provide financial statements sufficiently detailed so as to allow the APCO to assess CONTRACTOR'S capability of providing such selfinsurance. The APCO may reject self-insurance coverage where he finds that sufficient coverage will not be afforded to the DISTRICT. During the term of the Agreement, CONTRACTOR shall, at its sole expense, obtain and maintain in full force and affect the type and limits of liability requirements as follows: A. COMMERCIAL/COMPREHENSIVE GENERAL LIABILITY Bodily Injury and Property Damage for premises and operations; Personal Injury and Advertising for premises and operations; Independent Contractors (if any basis); Incidental Contracts; Contractual Liability; and Products and Completed Operations. "Claims made" policies are unacceptable. Minimum Limits: $1,000,000 combined single limit, on an occurrence policy form. B. BUSINESS AUTOMOBILE LIABILITY Protection against loss as a result of liability to others caused by an accident and resulting in bodily injury and/or property damage, arising out of the ownership or use of any automobile. If CONTRACTOR has no owned automobiles, then only hired and non-owned automobile coverage is required. Minimum Limits: $1,000,000 per occurrence for bodily injury or property damage, combined single limit. C. WORKER'S COMPENSATION AND EMPLOYER'S LIABILITY CONTRACTOR shall carry full Worker's Compensation insurance coverage for all persons directly employed, in carrying out the work under this contract, in accordance with the "Worker's Compensation and Insurance Act," Division IV of the Labor Code of the State of California and any acts amendatory thereof. Employer's Liability statutory limits will apply. If CONTRACTOR has no employees, no Worker's Compensation coverage is required. If CONTRACTOR hires subcontractors to perform under this agreement, the CONTRACTOR shall assure that the subcontractor carries workers compensation insurance for all of its employees, who are required to be covered by applicable law. and Yolo-Solano AQMD Page 1 of 2