ADMINISTRATIVE COMMITTEE
ITEM:		ACTION ITEM
8.	DEVELOP RECOMMENDATION TO BOARD REGARDING CONTRACT FOR LEGAL SERVICES
Meeting Date:			October 8, 2012	Budgeted:	N/A
From:			David J. Stoldt,	Program/	N/A
			General Manager	Line Item No.:
Prepared By:			David J. Stoldt	Cost Estimate:	$63,000 (retainer) $100,000 - $250,000 (special)
General Counsel Review: YES
Committee Recommendation: N/A
CEQA Compliance: N/A

SUMMARY: In FY2011-12 the Administrative Committee began a quarterly review of legal expenses and an increased focus on such expenditures. This resulted in decreased legal expenditures as compared to FY2010-11. The contract for General Counsel services expired June 30, 2012. While the Board has determined that it does not desire to change legal representation, it has indicated a desire to have stronger control over ongoing legal expenses. The proposed contract reflects this desire by bifurcating the scope of work into “retained” and “special” legal services.

RECOMMENDATION: The General Manager recommends that the Committee recommend approval of the proposed contract for legal services, as well as establish a term for expiration.

DISCUSSION: “Retained” general counsel services include day-to-day advice, written opinions, legal document review, appearances at all Board meetings, and appearance at committees or subcommittee meetings at the District upon request. This will be billed at a flat $5,250 per month or $63,000 annually.

“Special” legal services, will occur upon request by the District and subject to direction from the General Manager, and will include such things as appearances at non-District meetings or proceedings, oversight of special counsel, litigation advice or services, services subject to reimbursement by third parties, and bond, audit or financial services. These will be billed at the rate of two hundred fifteen dollars ($215) per hour, with monthly invoice.

Such services would include, for example, existing accounts for the Thum litigation, the Cal-Am application at the CPUC, the Proposition 218 rate-setting process, reimbursable work on water distribution system permits and water use permits, and so forth. When new needs are identified, the Board and the General Manager can request a specific budget and scope for the new needs.

While this will provide greater control over monitoring legal expenses, it will not control the number of special cases that arise, nor the hourly commitment each may require. The Board and the Administrative Committee will need to regularly review the District’s legal demands.

Additionally, under this contract the District agrees to reimburse General Counsel for all expenses and reasonable costs incurred by General Counsel relating to the District, including registration and expenses (in accord with District per diem rates and policies) for one conference sponsored by ACWA or other comparable organization each calendar year. District shall reimburse General Counsel all costs incurred on behalf of District including specialty counsel, appraisers, filing fees, witness fees, transcripts, reporter fees, hearing officer costs, photocopying costs, long distance telephone costs, travel and lodging costs, legal process fees, discovery costs, and jury fees. Out-of-District travel shall be billed at 50% of service rate. Costs shall be billed at actual cost (no over-head additions). No cost charge shall be made for communications or deliveries to or from other firm counsel.

EXHIBIT

8-A Agreement for Legal Services - DRAFT

U:\staff\Board_Committees\Admin\2012\20121008\08\item8.docx