BOARD MEETING DATE: November 5, 2004
AGENDA NO. 4

Execute Contract for Biennial Audit of Motor Vehicle Registration Revenues for FYs 2001-02 and 2002-03

SYNOPSIS:

Health and Safety Code Section 44244.1 requires any agency receiving fee revenues to be subject to an audit of each program or project funded at least once every two years. On July 9, 2004, the Board approved release of an RFP to select an auditor to perform the biennial audit for FYs 2001-02 and 2002-03. An evaluation panel of representatives from local governments, MSRC and AQMD Finance staff evaluated the proposals. This action is to award a contract to the firm of Thompson, Cobb, Bazilio & Associates, PC. Local governments, the MSRC and AQMD will pay the cost of their own audits in the amounts of $60,700, $9,950, and $6,900 respectively.

COMMITTEE:

Administrative, October 8, 2004. Less than a quorum was present for the discussion of this item; those Committee members present communicated their concurrence.

RECOMMENDED ACTION:

Authorize the Chairman to execute a contract with Thompson, Cobb, Bazilio & Associates, PC for performance of the biennial audit of Motor Vehicle Registration revenues for FYs 2001-02 and 2002-03 at a total cost not to exceed $77,550.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

AB 2766, chaptered into law as Health and Safety Code Sections 44220-44247 was enacted to authorize air pollution control districts to impose fees on motor vehicles. These fees are to be expended specifically for the purpose of mobile source air pollution reduction measures pursuant to the California Clean Air Act of 1988 or the AQMD’s AQMP pursuant to Article 5 of Chapter 5.5 of Part 3 of the Health and Safety Code. Health and Safety Code Section 44244.1(a) states that any agency receiving fee revenues pursuant to Section 44243 or 44244 shall, at least once every two years, be subject to an audit of each program or project funded. The audit is to be conducted by an independent auditor selected by the AQMD in accordance with Division 2 (commencing with Section 1100) of the Public Contract Code. Audit program guidelines for local government recipients of fee revenues under Health and Safety Code Sections 44220-44247 were prepared by the AQMD with input from the Technical Advisory Committee Audit Subcommittee of the IAIC, representatives of the Finance Committee of the League of California Cities and with CPA firms whose clients include local governments. These audit guidelines were approved by the IAIC, MSRC and by the Board on December 4, 1992 and further revised and approved in January 1995, and again in August 2003. This is the sixth biennial audit of these fee revenues and covers FYs 2001-02 and 2002-03.

Proposal

On July 9, 2004, the Board approved an RFP to conduct the biennial audit of recipients of AB 2766 fee revenues. The audit will cover recipients in all three segments of the AB 2766 fee distribution to determine whether the fee revenues collected in FYs 2001-02 and 2002-03 were spent on the reduction of pollution from motor vehicles as described above. The primary purpose of the audit is to set forth an opinion regarding the propriety of the expenditures incurred, not the degree of efficacy in reducing air pollution.

Outreach

In accordance with AQMD’s Procurement Policy and Procedure, a public notice advertising the RFP/RFQ and inviting bids was published in the following publications:
 

1.	Antelope Valley Press	11.	La Opinion	21.	Rafu Shimpo
2.	Black Voice News	12.	La Prensa Hispana	22.	San Bernardino Sun
3.	Chinese Daily News	13.	La Voz Publications	23.	State of California Contracts
4.	Desert Sun	14.	Los Angeles Daily News		Register
5.	Eastern Group Publications	15.	Los Angeles Sentinel	24.	The Daily Breeze
6.	El Chicano	16.	Los Angeles Times	25.	The Excelsior
7.	El Informador	17.	Orange County Register	26.	The Signal
8.	Inland Empire Hispanic News	18.	Philippine News	27.	Wave Community Newspapers
9.	Inland Valley Daily Bulletin	19.	Precinct Reporter
10.	Korea Central Daily	20	Press Enterprise

Additionally, potential bidders were notified utilizing the Los Angeles County MTA Directory of Certified Firms, the Inland Area Opportunity Pages Ethnic/Women Business & Professional Directory; and AQMD’s own electronic listing of certified minority vendors. Notice of the RFP/RFQ was mailed to the Black and Latino Legislative Caucuses and various minority chambers of commerce and business associations, and placed on the Internet at AQMD’s Web site (http://www.aqmd.gov where it could be viewed by making menu selections "Inside AQMD"/"Employment and Business Opportunities"/"Business Opportunities" or by going directly to http://www.aqmd.gov/rfp/index.html). Information was also available on AQMD’s bidder’s 24-hour telephone message line (909) 396-2724.

Bid Evaluation

The AQMD received a total of two proposals by the 1:00 p.m., August 27, 2004 deadline which were evaluated by a technically qualified panel in accordance with criteria contained in the RFP.

Panel Composition

An evaluation panel was convened to evaluate the two proposals and consisted of a representative from local governments; a representative from the MSRC; and three AQMD staff, the Controller and two Financial Analysts. Of the five panelists that scored the proposals, one is Asian Pacific Islander and four are Caucasian; three are female, two are male.

Of the two proposals received, both were rated technically qualified and were scored for cost. The evaluation results for the two proposals are:
 

The selection criteria used to rank the proposals included responsiveness to the RFP; technical expertise; qualifications and experience; past performance; cost; and SB/SBJV/DVBE/DVBEJV/DVBE/SB subcontractors/local business designation (non-EPA). Based on the panel’s assessment of the criteria, Cobb, Bazilio & Associates, PC was selected to be recommended to the full Board.

Resource Impacts:

The maximum audit cost is $77,550. The total audit costs will be borne by the entities being audited as follows:

• The cost of the audit of the AQMD's portion of motor vehicle registration revenues is $6,900. Sufficient funds are included in the FY 2004-05 Budget;
   
• The cost of the audit of ten projects and the Mobile Source Air Pollution Reduction Trust Fund is $9,950 and shall be deducted from the FY 2004-05 revenues subvened to the Mobile Source Air Pollution Reduction Review Committee; and
   
• The total cost of the audit of local governments is up to a maximum of $60,700. This cost will be borne by the entities being audited in the manner set forth in the audit program guidelines and will be deducted from quarterly fee revenues prior to distribution.

/ / /