PROPOSAL:
Amend Employee Relations Litigation and Negotiation Services Contract
and Appropriate Funds from Undesignated Fund Balance
SYNPOSIS:
The AQMD has incurred significant attorneys’ fees defending an
employment lawsuit. The court recently granted AQMD’s motion for summary
judgment, which will end the case, unless plaintiff appeals. Although most
of the fees will be reimbursed by the plaintiff or insurance, it is
necessary to amend the contract with AQMD’s outside counsel, Best, Best &
Krieger, to pay those fees. It is also necessary to appropriate this
amount from the undesignated fund balance.
COMMITTEE:
Administrative, December 9, 2005, Recommended for Approval
RECOMMENDED ACTIONS:
- Authorize the Chairman to amend the existing contract with Best Best &
Krieger for employee relations litigation and negotiation services to
increase the contract amount for FY 2005-06 by an additional $50,000.
- Appropriate $50,000 from the Undesignated Fund Balance to the FY
2005-06 Budget, District General, Professional and Special Services
account.
Barry R. Wallerstein, D.Env.
Executive Officer
Background
On June 6, 2003, the Board approved a prequalified list of five law firms
to provide employee relations litigation and negotiation services for the
period July 1, 2003, through June 30, 2006. An existing three-year contract
with one of these firms, Best, Best & Krieger, is limited to $50,000 per
year. The firm currently represents AQMD in an employment case, ongoing
since 2001, that will exceed the annual contract limit. This is the only
AQMD matter handled by Best, Best & Krieger. Current fees expended on the
case will exceed the $50,000 annual limit approved by the Board. Thus, it is
necessary to increase the annual contract limit by an additional $50,000. It
is also necessary to appropriate this amount from the undesignated fund
balance.
The costs for this case have exceeded the deductible amount of $50,000 in
AQMD’s employment-claims insurance policy, and thus the insurance will cover
most remaining costs and fees, including the $50,000 proposed to be
appropriated in this item.
AQMD recently prevailed on a motion for summary judgment in this case. We
have also filed a motion to recover a substantial portion of our attorney’s
fees. We are hopeful that the ruling will terminate additional attorneys’
fees and costs, at least for AQMD. However, if plaintiff appeals, staff will
need to make an additional request for authorization from the Board for
increased funding to pay the costs of an appeal.
Proposal
Staff recommends that the Board authorize an additional amount of up to
$50,000 for the existing contract with Best, Best & Krieger for FY 2005-06,
and that the Board authorize appropriating $50,000 from the undesignated
fund balance to the District Counsel’s Professional and Specialized Services
account.
Resource Impacts
There is minimal financial effect from this item, other than a temporary
loss of funds in the amount of $50,000, because most amounts paid for this
matter will be reimbursed by insurance or by the plaintiff if we prevail on
our motion for attorney’s fees.
Attachment(s)
None
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