COUNTY CONTRACT WEBINAR TRAINING

1. COUNTY CONTRACT WEBINAR TRAINING Welcome

2. AGENDA 1. Welcome & Introductions 9:00 – 9:10 2. Scope of Work/Budget Display 9:10 – 9:30 3. Contract Process/Timelines 9:30 – 9:50 4. Terms & Conditions and Additional Provisions 9:50 – 10:10 • GTC–610 NEW! • Right to Terminate – NEW! • Federally Funded – NEW! • Subcontracting – NEW! • Insurance for Hazardous Activities – NEW! • County Resolution/Board Minutes 5. Invoice Process/Timelines 10:10 – 10:30 6. Questions 10:30 – 11:00

3. OVERALL PURPOSE • To educate you on CDFA contract process. • To provide you with better understanding of CDFA’s reasons for delays. • CDFA to better understand county contract process and reasons for county delays. • Determine what changes can be made to timely execute contracts prior to contract start date. • Streamline CDFA/County contract process.

4. TRAINING GOALS AND OBJECTIVES • Identify roles and responsibilities of CDFA Staff in the contracting process • Understand contract processing timelines and reasons for delay • Define contract elements • Knowledge of recent changes to state contracting language and requirements • Understand invoicing process

5. CDFA ROLES AND RESPONSIBILITIES Program Staff • Determine need for services • With assistance from you, prepare Scope of Work (SOW) and Budget • Prepares and submits contract request • Contract Management

6. CDFA ROLES AND RESPONSIBILITIES CONT. Contracts Office (CO) Staff • Review contract request, SOW and budget for completeness and accuracy • Develop contractual document • Prepare contract to send to county for approval and signature • Analyze returned contract and required documentation • Prepare and submit contract for final signature/execution • Distribute executed contract

7. SOW & BUDGET

8. CONTRACT ELEMENTS Main Elements of Contract: • SOW and Budget Display. • CDFA Program staff and/or county will develop SOW and Budget to send to counties to complete. • Contents of SOW and Budget are linked to reflect and/or match the same information.

9. SOW PROCESS • CO pre-reviews the SOW for completion and accuracy. (This process is usually done before counties are asked to submit a budget). • Does it specify CDFA’s role versus the county’s role? • Does it detail the work to be done? • Does it list a program point of contact? • Does it specify how the county will get reimbursed? • Does it meet DGS requirements?

10. REMEMBER…. • The SOW only details the work to be done. • It does not provide step-by-step directions on “how to” do the work. • Ensure all appendices and attachments are attached if stated in SOW. • When county contracts with CDFA each year for the same project, do not assume there are no changes to the SOW. • Your feedback and your communication are important.

11. BUDGET DISPLAY • Budget solicitation from counties is a multi-step process. • The budget displays and SOW are linked to reflect the same information. • Incomplete and/or inaccurate budget displays submitted to CDFA are top reasons for delays to timely submit to CO for processing. • Most budget displays are produced in Excel using formulas. • Budgets are reviewed by program staff to ensure mathematical accuracy and may be audited by program staff for other material. • Budget calculations (vertically and horizontally) must balance to the penny (or round to the nearest dollar) by hand calculator, otherwise returned to the counties for correction.

12. TYPES OF BUDGETS(See Handout #1 – Budget Examples) • Budgets are designed to be program specific. • Budgets are estimates only. Counties are only limited to the total funding amount of the contract. • Some budgets may require that personnel costs be broken down by classification that: • Indicate individual hourly rate and benefit rate and… • Combine total hourly rate.

13. ALLOCATIONS The list below are allocations that must be separate line items on Budget, if applicable. • Personnel Services (salary and benefits may be combined) • Overhead • Travel • Transportation • Vehicle Purchases • Facilities • Subcontracting • Supplies

14. BUDGET APPROVAL PROCESS(See Handout #2 – Precision As Displayed) • Budget request is sent to counties with a deadline date to return to CDFA. • CDFA Program reviews for mathematical accuracy and/or program accuracy. • If errors found - return to the counties for revision and resubmission, or…. • If minor errors are found, CDFA Program Staff may modify. • Dependent on funding, budgets are either used to prepare the contract package, or put on hold dependent upon the final available funding. • Dependent of funding situation, counties may be asked to resubmit budgets based on revised, and reduced SOW. • When funding has been secured with a complete and accurate SOW and Budgets, the contract request packages are routed for signature to the CO to process.

15. AMENDMENTS • When an amendment is necessary, program staff submit a revised SOW that will have underline and strike out text (showing changes) and/or a revised Budget to CO before the contract expires.  • The same process that will be discussed later in this power point will apply to amendments. Note: An amendment occurs when a change to the SOW or Budget of an executed contract. If the contract is not yet executed, the changes are called a revision.

16. SCOPE OF WORK (SOW) & BUDGET Questions

17. CDFA CONTRACTING PROCESS

18. Can the work be done by CDFA staff? CDFA program staff determine need for services Can the work be performed by local government No Yes No contractual need exists Seek Contract with other resources Yes CDFA CONTRACTING PROCESSLocal Government (County) No

19. Can the work be performed by local government Program submits contract request, with Government Code (GC) 19130, SOW and Budget to Budget Office for approval CDFA and County Staff prepare SOW and Budget CDFA CONTRACTING PROCESSLocal Government (County)

20. CDFA CONTRACTING PROCESS CO Support Staff logs in contract request and assigns to Contract Analyst Contract Analyst reviews contract request for completeness; develops contractual document Budget Analyst review and approve funding data on contract request. If approved, forward to CO; if not approved, return to program. County returns signed copies of contract with Board resolution, CCC-307 Contract Analyst prepares contract to send to County for approval & signature

21. CDFA CONTRACTING PROCESS CDFA Contracts Manager signs originals of contract Yes Contracts Analyst sends contract to DGS Legal and/or ORIM for approval No Distribute copies of fully executed contract. Contractor can begin work. DGS Legal reviews/ approves and returns contract to contract analyst Distribution: Orig – Contractor Orig – Contract file Copy–Program Contract Mgr Copy – Accounting Copy – State Controller Total amount $75,000 or greater and/or if changes made to Terms & Conditions or hazardous

22. CDFA CONTRACTING PROCESS Questions

23. TIMELINES

24. TIMELY SUBMISSION • Contract timing is of the essence. • Many steps and stops involved in processing a contract. • Important to work together as a Team both CDFA and counties to prepare and process our contracts timely.

25. TIMELINES FOR CO SUBMITTAL MAY VARY AS A RESULT OF THE FOLLOWING: • During the heavy contract period from April through September. • Submittal of incomplete and/or inaccurate contract requests, SOW, Budget and other related documents. • Contract request package submitted in groups of 20 or more at the same time to the CO.

26. CDFA/COUNTY TIMELINES • CDFA Program/County should plan ahead well in advance to begin preparing SOW and Budget. • SOW and Budget preparation should begin 90 days (3 months) or sooner in advance of April 1st each year. (If start date of contract is July 1)

27. CDFA PROGRAM & CO TIMELINES • CDFA Program submission to the CO at least (90) days prior to start date. (3 months) • CDFA Program submission to the CO of Amendments at least (90) days prior to expiration date of the existing contract. (3 months) * Please keep in mind that contracts cannot be amended once they have expired.

28. POTENTIAL REASONS FOR DELAY (PRIOR TO SENDING TO COUNTY) Program and County: • SOW is incomplete and/or incorrect • Budget sheet is incomplete/incorrect Program and CO: • Program does not submit required documentation • Improper routing within the Department

29. COUNTY CONTRACT APPROVAL PROCESS The following county entities may be required to review and approve each contract: • County Agricultural Commissioner • Chief Financial Officer • County Counsel • County Clerk • Board of Supervisors

30. DEPARTMENT OF GENERAL SERVICES (DGS)- OFFICE OF LEGAL SERVICES (OLS)/OFFICE OF RISK AND INSURANCE MANAGEMENT (ORIM) APPROVAL REQUIRED • When county changes the General Terms and Conditions, add (10) additional working days for DGS/OLS review. • When contract involves Hazardous Activities, add (15) additional working days for DGS/ORIM and DGS/OLS review and approval.

31. DGS/OLS UNAPPROVED Contract returned to CDFA unapproved, the following steps must be taken : • CO analyst reviews DGS requested information to determine what is needed. • There may be a need to consult with CDFA Legal Office for advisement on DGS issues – add a minimum of 10 business days for DGS/OLS review, in addition to the CO processing time. • Obtain DGS requested information from CDFA Program such as statutory authority and/or various justifications. • Resubmit requested information to DGS/OLS. * Note: Due to State furloughs extra days may be necessary for DGS/OLS to review and approve.

32. TIMELINES Questions

33. STATE’S GENERAL TERMS & CONDITIONS (GTC)

34. STATE’S GTC(See Handout #3- Exhibit C) New Language: • GTC revised effective June 9, 2010 (revised from GTC 307 to current GTC 610). • Small Business and Disabled Veterans Business Enterprise Participation – applicable when using subcontractors to perform portion of service. • Loss Leader – Business and Professions Code 10730, Public Contract Code (PCC) 10344(e) – applicable when using subcontractors to perform portion of service. Business and Professions Code 17030. "Loss leader" means any article or product sold at less than cost: a) Where the purpose is to induce, promote or encourage the purchase of other merchandise; or b) Where the effect is a tendency or capacity to mislead or deceive purchasers or prospective purchasers; or c) Where the effect is to divert trade from or otherwise injure competitors. PCC 10344(e)The state agency used the evaluation and selection procedure in subdivision (c) of Section 10344, but is proposing to award the contract to a bidder other than the bidder given the highest score by the state agency evaluation committee.

35. STATE’S GTC CONTINUED.. Proposing changes to GTC 610 requires: • County to submit statute citation why GTC cannot be agreed to. • State to submit why it is in the best interest of State to agree to altered terms. • Determine if any adverse impact to State and if State is adequately protected. • Request CDFA Legal Office to advise and prepare memo to send with contract to DGS/OLS.

36. RIGHT TO TERMINATE(See Handout #4 – Exhibit D) • OLS questioned the Right to Terminate clause in county agreements. • CO and CDFA Legal have revised the language to reflect the following: The State reserves the right to terminate this agreement subject to 30 days written notice to the Contractor. Contractor may submit a written request to terminate this agreement only if the State should substantially fail to perform its responsibilities as provided herein. However, the agreement can be immediately terminated for cause. The term "for causes” shall mean that the Contractor fails to meet the terms, conditions, and/or responsibilities of the contract. In this instance, the contract termination shall be effective as of the date indicated on the States' notification to the Contractor. This agreement may be suspended or cancelled without notice, at the option of the Contractor, if the Contractor or State's premises or equipment are destroyed by fire or other catastrophe, or so substantial damaged that it is impractical to continue service, or in the event the Contractor is unable to render service as a result of any action by a state agency directly impacting the Contractors ability to perform.

37. ADDITIONAL PROVISIONS(See Handout #5 – Exhibit E) Federally Funded Contracts • Shall contain language that the contract can be amended or canceled if federal funding is reduced or canceled. Subcontractors (See Handout #6 – Subcontracting Example) • Any subcontractors performing portion of work for services to be performed shall: • Perform less than 25% of total contract amount or $50,000, whichever is less, or • Require three (3) competitive bids Insurance Coverage • ORIM and OLS have determined that we must require proof of insurance for all county contracts, to include: • General Liability • Automobile Liability • Worker’s Compensation • Environmental/Pollution Liability (when applicable)

38. ADDITIONAL REQUIREMENTS Resolutions/County Ordinances • All Contracts shall be returned with either, Board of Supervisors minutes, or resolution, to include: • Contract identification • Authorization for signatory • County Code or Ordinance authorizing signatory Contractor Certification Clauses (CCC-307) (See Handout #7) shall be signed and returned with each contract.

39. STATE’S GENERAL TERMS & CONDITIONS (GTC) Questions

40. INVOICING

41. KEY POINTS TO INVOICING • You will prepare an invoice to submit to CDFA for reimbursement of work performed. • Two different State agencies are involved in the reimbursement process, CDFA and the State Controller’s Office (SCO). • While CDFA is the contracting agency, the SCO generates a check (warrant) and mails it to the county.

42. PROCESS OVERVIEW • CDFA Program Contract Manager (PCM) receives an invoice for reimbursement from the county. • PCM reviews the invoice to ensure it meets the scope of work identified in the contract and that there are sufficient funds to have the invoice paid. • Invoices are approved by PCM. • PCM submits approved invoice to the Financial Services Branch Accounts Payable Unit (AP). • AP Unit will review the invoice for compliance with the payment terms, and schedules the invoice for payment within 30 calendar days of receipt. The schedule is then forwarded to SCO. • SCO will review the invoices, verify the contract funding, expiration date, and issue payment, typically within 15 calendar days of receipt of the claim schedule. Payments are sent to the County Treasurer’s Office. Payments made to Public Entities are not subject to late fees or penalties. Per Government Code 811.2, a "Public Entity" includes the State, the Regents of the University of California, a county, city, district, public authority, public agency, and any other political subdivision or public corporation in the State.

43. MISSING LINKS No Executed Contract • The AP Unit cannot process an invoice for payment untilthere is an executed contract. No State Budget • Invoices are paid out of a “General Fund Clearing Account” and are reimbursed by the contract’s funding source. • Contracts that are paid from the General Fund may be subject to delay due to a budget impasse.

44. NEED REIMBURSEMENT, WHAT TO DO NEXT? Review your SOW • SOW should provide directions on how to invoice for reimbursement. This should include: • Who to send the invoices to • Address to send the invoices to • A timeline if any • The SOW may also specify an invoice template that needs to be used. Invoicing/Reimbursement • Immediately after work is completed, submit an invoice in compliance with the contract terms to the CDFA PCM for approval. • All receipts for purchases do not need to be submitted to CDFA, but must be retained by you for audit purposes.

45. WHY WOULD CDFA REQUIRE USING SPECIFIC OR CERTAIN TEMPLATE AND BILLING SCHEDULE (See Handout #8 – Invoice Example) • There are various reasons why a particular program may need to be invoiced on a particular form. • If funds for the contract come from USDA, or some other source, the agreement that CDFA has with the funding source may require that invoicing be done a particular way. • CDFA may also need to submit invoicing on a particular form to comply with audits. • Until you invoice CDFA and the expenditures appear on CDFA’s budget report, CDFA cannot bill the appropriate entity for reimbursement.

46. WHERE IS THE FLEXIBILITY? • If unable to use the invoice template specified in SOW, or • Unable to meet any of the other invoicing provisions in SOW, contact the PCM per SOW. • PCM will work with you to ensure both county & state needs are met.

47. WHY THE DELAYS? CHECK DOESN’T MATCH INVOICE? Invoice sent to the wrong place/person: • SOW specifies where and to whom invoices are to be sent. Wrong contract number: • Ensure the correct contract number is on your invoice. • Check the remittance that comes with the payment and verify the program and contract number. Invoice doesn’t balance: • CDFA will verify mathematical computation prior to scheduling. • Verify your math to make sure there are no mistakes. Non-billable items: • SOW specifies what work is to be done. • Non-billable items will not be reimbursed. Contract is billed in full: • Keep track of how much reimbursement has been received.

48. AVOID THE PITFALLS… Formula Modification: • When using a CDFA invoice template in Excel, do not modify the formulas. • Contact the point-of-contact in the SOW and let them know so he/she can help. Mileage Rate: • Federal Government (FG) sets the mileage reimbursement rate for all invoices paid with Federal dollars. • CDFA cannot pay mileage over the rate that has been set by the FG. • FG can change the mileage rate during your contract term. • Overhead cannot be charged on mileage. Itemized Invoice: • Invoices must be itemized to be reimbursed. • Personnel must be billed on a separate line item with overhead not to exceed 25%. • Invoices must include the mileage reimbursement rate in order to be paid.

49. INVOICING Questions

50. CONCLUSION Have our training goals and objectives been met? • Identify roles and responsibilities of CDFA Staff in the contracting process • Understand contract processing timelines and reasons for delay • Define contract elements • Knowledge of recent changes to state contracting language and requirements • Understand invoicing process