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ARF- 500

Consent Agenda Item 5- E

Regular BOS Meeting

Meeting Date:	05/17/2011
Submitted For:	Barbara Valencia, WIA Department Program Manager
Submitted By:	Barbara Valencia, Community Services Division
Department:	Community Services	Division:	WIA Division
Fiscal Year:	Program Year 2010	Budgeted?:	Yes
Contract Dates Begin & End:	July 1, 2009 - June 30, 2014	Grant?:	Yes
Matching Requirement?:	No	Fund?:	Replacement

Information

Request/Subject

Amendment No. 1 to Intergovernmental Agreement No. DE101056001 with Arizona Department of Economic Security.

Background Information

The purpose of this Intergovernmental Agreement is to provide the required One-Stop services outlined in the Workforce Investment Act of 1998. As a mandated partner in the One-Stop Delivery System, the Arizona Department of Economic Security shall provide REPAC (Re-employment and Placement Assistance Center) the necessary office space to perform work duties.

Evaluation

The Arizona Department of Economic Security (DES) shall provide Gila County REPAC workspaces at Lake Havasu City and Safford to perform work duties. Gila County REPAC (Re-employment and Placement Assistance Center) will reimburse DES for usage of the workspaces and a percentage of the common area at both locations on a monthly basis.

DES made an error in the original agreement in the amount of indirect costs they would charge for the REPAC workspaces. Indirect costs are costs which are costs incurred for common or joint purposes. The indirect costs in the original IGA were listed as 1.12% and 1.84% whereas the State meant for those indirect costs to be listed as 19.54% for both locations.

Gila County Community Services is satisfied that the true amount of indirect costs that DES bears for the workspaces should be 19.54%.

Conclusion

Amendment No. 1 to the Intergovernmental Agreement between the Arizona Department of Economic Security and Gila County REPAC has been revised as follows:

From: Section 31.0 Indirects - 31.3.1 - Indirect charges as defined by OMB Circular A-97, which states, in part, "that indirect costs are those that have been incurred for common or joint purposed. These costs benefit more than one cost objective and cannot be readily identified with a particular final cost object without effort disproportionate to the results achieved," will be invoiced at 1.12% for Location I and 1.84% for Location II of the total occupancy costs plus monthly voice bill.

Change to: 31.3.1 - Indirect charges as defined by OMB Circular A-97, which states, in part, "that indirect costs are those that have been incurred for common or joint purposes. These costs benefit more than one cost objective and cannot be readily identified with a particular final cost object without effort disproportionate to the results achieved," will be invoiced at 19.54% for Location I and 19.54% for Location II of the total occupancy costs plus monthly voice bill.

The Gila County REPAC 2004 to 2009 contract indirect charge was 20.19%. That percentage was decreased to 18.10% with the implementation of Amendment #5 in May 1, 2007. The indirect charge of 18.10% was effective for the remainder of the contract, which ended June 30, 2009.

Amendment #1 for the new contract (DE101056001) effective July 1, 2009, is to correct the error where the indirect percentage was incorrectly entered as the the same figures associated with Gila County REPAC's cost of occupancy. The indirect charge should have been 19.54%.

Recommendation

Recommendation to approve Amendment No. 1 to the Intergovernmental Agreement No. DE101056001 with the Arizona Department of Economic Security.

Revised Section 31.0 Indirects
From: 31.3.1 Indirect Charges as defined by OMB Circular A-87, which states, in part, "that indirect costs are those that have been incurred for common or joint purposes. These costs benefit more than one cost objective and cannot be readily identified with a particular final cost object without effort disproportionate to the results achieved," will be invoiced at 1.12% for Location I and 1.84% for Location II of the total occupancy costs plus monthly voice bill.

Change to: Indirect charges as defined by OMB Circular A-87, which states, in part, "that indirect costs are those that have been incurred for common or joint purposes. These cots benefit more than one cost objective and cannot be readily identified with a particular final cost object without effort disproportionate to the results achieved," will be invoiced at 19.54% for Location I and 19.54% for Location II of the total occupancy costs plus monthly voice bill.

Suggested Motion

Approval of Amendment No. 1 to an Intergovernmental Agreement (Contract No. DE101056001) between Gila County and the Arizona Department of Economic Security to revised Section 31.0-Indirects.

Attachments
LETTER - CONTRACT #DE101056001 - AMENDMENT #1
DES CONTRACT #101056001 - AMENDMENT #1
DES CONTRACT #101056001-AMENDMENT #1-COMPARISON
DES CONTRACT NO. 101056001