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File Number: 22-707 current agreement as well as the proposed amended agreement continue to utilize the fee-for-service cost structure. The current biennial budget provides $980,000 for the provision of the existing legal services agreement in FY 2022-2023 fiscal year. There would be no change in the level of service or the budget for FY 2023-2023 under the proposed amendment. Analysis The City has now been operating under the fee-for-service contractual structure since 2013. Based upon staff's analysis, the current contract structure is effective in controlling costs and generating financial savings as predicted by the MRG analysis. Meyers Nave now requests that the City Council authorize an amendment to its existing agreement that would extend the agreement’s term through December 31, 2029. In recognition of ongoing macroeconomic inflationary pressures and increased costs of doing business, the proposed agreement includes a modest adjustment to the existing previously authorized hourly billing rates based upon changes in the consumer price index (CPI) each year for the duration of the contract, up to a cap. More specifically, the rates for all city attorney work except litigation and land use cost recovery work (the costs of which are passed through to developers through the development application, which is best practice throughout the State) will be adjusted each July 1, beginning July, 1, 2023 by the April percentage change in the CPI for the San Francisco-Oakland-San Jose area, though in no case would those rate changes be less than 1% and no greater than 3.5% each year. Fiscal Impacts The adopted 2022-2023 biennial budget appropriations for legal services is $980,000. If authorized, the proposed new agreement would establish a not to exceed amount for all city attorney services of $1,014,300 in Fiscal Year 2023-2024. Prospective future budget year costs would never increase more than 3.5% annually thereafter, and would slide back to a lower percentage if the CPI were less for a given year. Per the Agreement, Meyers Nave’s contract cost is structured with a not-to-exceed amount that constitutes a "hard cap" in the budget that the City Council has no obligation to increase. Budget Authority If the proposed amendment is adopted, sufficient funds for future budget years will be incorporated into upcoming proposed biennial budgets, in account 010-11-040-5110. Attachment to Resolution ·Attachment A: Resolution Authorizing Legal Services Agreement Amendment ·Attachment B: Legal Services Agreement Amendment Prepared by: Eric Engelbart, Deputy City Manager Page 2 City of San Leandro Printed on 12/14/2022