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HomeMy WebLinkAboutAmendment No 2 to PSA - Implement CDFI Friendly South Bend Contract Board and Additional Program Management - MPinsky, LLC dba Five Four Advisors1316 COUNTY -CITY BUILDING 227 W.JEFFERSON BOULEVARD SO11TH BEND. INDIANA 46601-1 Rail CITY OF SOUTH BEND JAMES MUELLER, MAYOR BOARD OF PUBLIC WORKS January 28, 2020 Mr. Mark A. Pinsky MPinsky, LLC d/b/a/ Five/Four Advisors 240 E. Evergreen Ave. Philadelphia, PA 19118 RE: Amendment No. 2 to Professional Services Agreement Dear Mr. Pinsky: PHONE 574/235-9251 FAX 574/235-9171 The Board of Public Works, at its meeting held on January 28, 2020, approved the above referenced amendment to implement a CDFI Friendly South Bend contract board, and additional program management in the amount of $150,000. Enclosed please find the original of the agreement for your signature. Please sign and return the original agreement to our office and retain a copy for your records. If you have any further questions regarding this matter, please call this office at (574) 235-9251. Sincerely, Linda M. Martin, Clerk Enclosure GARY A. GILOT ELIZABETH A. MARADIK THERESE J. DORAU JORDAN V. GATHERS JOSEPH R. MOLNAR SECOND AMENDMENT TO PROFESSIONAL SERVICES AGREEMENT This Second Amendment to Professional Services Agreement (this "Second Amendment") is made effective on January 1, 2020 (the "Effective Date"), by and between the City of South Bend, Indiana, an Indiana municipal corporation, acting by and through its Board of Public Works (the "City"), and MPinsky, LLC d/b/a Five/Four Advisors (the "Contractor") (each a "Party" and collectively the "Parties"). RECITALS A. The City and the Contractor entered into a Professional Services Agreement dated November 13, 2018, which was subsequently amended by a First Amendment to Professional Services Agreement dated June 25, 2019 (together, the "Services Agreement"), for the provision of Services to the City (as more specifically defined in the Services Agreement). B. The City and the Contractor wish to amend the Services Agreement to include additional Services. NOW, THEREFORE, in consideration of the mutual promises and obligations in this Second Amendment and the Services Agreement, the adequacy of which consideration is hereby acknowledged, the Parties agree as follows: 1. Section 1 of the Services Agreement shall be deleted in its entirety and replaced with the following: Duties of the Contractor. The Contractor will provide to the City the professional services (the "Services"), set forth in the Contractor's proposal attached hereto as Exhibits A A-1 and A-2 (together, the "Scope of Work"). In the event of any conflict between the terms of this Agreement and the terms of the Scope of Work, the terms of this Agreement, as amended, will prevail. The Contractor will execute its obligations under this Agreement in accordance with the prevailing professional standard of care for projects of similar design and complexity. 2. Section 2 of the Services Agreement shall be deleted in its entirety and replaced with the following: Consideration. The Contractor will be paid within thirty (30) days of its submission of an undisputed invoice. For the Services set forth under Exhibit A, the consideration shall not exceed Forty Thousand Dollars ($40,000); for the Services set forth under Exhibit A-1, the consideration shall not exceed Sixty Thousand Dollars; and for the Services set forth under Exhibit A-2, the consideration shall not exceed One Hundred Fifty Thousand Dollars ($150,000). The total consideration under this Agreement shall not exceed the sum of Two Hundred Fifty Thousand Dollars ($250,000). Any payment that the City may deny or withhold or 1 delay shall not be subject to penalty or interest under Indiana Code § 5-17- 5. Section 3 of the Services Agreement shall be deleted in its entirety and replaced with the following: Term. This Agreement shall be effective for a period of 18 months commencing on January 1, 2019 ("Effective Date") and shall end no later than June 30, 2020 ("Expiration Date"). 4. The attached Exhibit A-2 shall be incorporated into the Services Agreement after Exhibits A and A-1. 5. Unless expressly modified by this Second Amendment, the terms and provisions of the Services Agreement remain in full force and effect. 6. Capitalized terms used in this Second Amendment will have the meanings set forth in the Services Agreement unless otherwise stated herein. IN WITNESS WHEREOF, the parties hereto have executed this Second Amendment to Professional Services Agreement to be effective as of the Effective Date stated above. MPINSKY LLC CITY OF SOUTH BEND, INDIANA DBA FIVE/FOUR ADVISORS BOARD OF PUBLIC WORKS By _....................._ _w.... __. Gary Gilot, President Printed: . ........w _................... ................... _ Title:_ ........, r" erese Dorau, Me r rc� Jor ttaters, n�'r _. ... .._ . Elizabeth Marad`' , Member Josepl Molnar, Member ATTEST: hda Martin Clerk EXHIBIT A-2 Additional Scope of Services Re: CDFI Friendly South Bend Implementation Stage Proposed Scope of Work To: Kacey Gergely, Chief of Staff to Mayor James Mueller, City of South Bend Denise Riedl, Chief Innovation Officer Brian Donoghue, Director of Civic Innovation From: Mark Pinsky & Adina Abramowitz, CDFI Friendly America January 9, 2019 Kacey, Denise & Brian, The purpose of this memo is to recommend an updated Scope of Work with which to extend the contract originally signed November 13, 2018, between the City of South Bend's Board of Public Works and Five/Four Advisors. The proposed scope of work presented below would serve as Exhibit A to the contract extension. INTRODUCTION Thank you for the opportunity to offer ongoing consulting services to CDFI Friendly South Bend (CFSB) in 2020. To continue the positive momentum on this project under the amended agreement between the City of South Bend and MPinsky LLC d/b/a Five/Four Advisors, we recommend a six-month implementation stage of consulting to include all the necessary steps to establish and make operational the independent nonprofit corporation, form the initial Board of Directors, seek and receive funding commitments, initial branding and marketing, and hiring of the permanent Executive Director. Throughout this timeframe, we will also manage CFSB and make appropriate matches between those in COSB seeking non -conforming capital and those who can provide it, particularly but not only CDFls, banks, and credit unions. MPinsky LLC is continuing its work on CDFI Friendly strategies through a new entity, CDFI Friendly America LLC, a partnership between MPinsky LLC and Adina Abramowitz. In addition, to further the purposes of CFSB by making its implementation clearly independent of the COSB, as planned, Sonja Karnovsky will leave her post at COSB and join CDFI Friendly America LLC to serve as Interim Executive Director of CFSB. In that role she will manage the day-to-day work to stand up the company including but not limited to making matches between capital supply and demand. When the Board of Directors of CFSB hires a full-time Executive Director and determines it no longer requires an interim Executive Director, Sonja will step down as Interim Director. Mark will be the principal lead on the fundraising, marketing and communications efforts. Adina will lead the efforts to form and assist the initial Board of Directors, and the hiring effort for the initial Executive Director. Sonja will manage day-to-day operations, staff the Board of Directors, and provide continuity in strategy. We assume that responsibility for this contract will transfer from the City of South Bend to the new entity when it is chartered, formed, and funded with remaining funds from the City and other sources. PROPOSED SCOPE OF SERVICES FOR CONTRACT EXTENSION The proposed draft language for Exhibit A is consistent in approach and specificity with the language the COSB used in prior contracts with Five/Four Advisors. EXHIBIT A Scope of Services 1. Continue to assist with implementation of the City's strategy to leverage external community development financing based on the business plan Five/Four Advisors completed in December for the COSB, including: - Managing the formation of the legal entity to be known initially as CDFI Friendly South Bend (subject to the approval of the Board of Directors of the entity), - Ensuring the transition from public (City) management of the process to private operations as a 501.c.3 nonprofit corporation governed by an independent Board of Directors, - Forming, recruiting and advising the initial Board of Directors based on community input and a matrix of desired skills and representations, - Assisting in raising operational funding and investment capital as recommended in the business plan, - Leading communications, marketing, and branding during the implementation phase, - Hiring a permanent, full-time Executive Director, and - Matching demand for CDFI and other forms of financing in South Bend to providers of appropriate, affordable financing from CDFI and other sources outside and within South Bend. 2. Provide technical assistance to ensure that implementation is consonant with knowledge gained during earlier phases of the CDFI Friendly South Bend work and in line with the priorities and goals identified by participated in that process. BACKGROUND TO SCHEDULE A To ensure mutual agreement and understanding, we want to provide specific information about the work described in the proposed Exhibit A. In addition, we are providing a Gantt chart detailing the workplan and timeline. We envision seven interrelated components to the implementation stage of this project: I. Legal Formation Working with the City Attorney, we will create and file the paperwork necessary to form a private sector corporate entity, thus separating CFSB from the City of South Bend. We will draft Articles of Incorporation and proposed Bylaws for Board review, refinement and approval. We will begin the process of applying for nonprofit 501c3 status. Lead: Sonja; Secondary: Adina Timeframe: January to March 2020 and any necessary follow up on 501c3 application 2 1 l a a , t y II. Transition to Private Sector CFSB has already received the go ahead and encouragement from the new Mayor of the City of South Bend's to become a separate, private sector entity. Other related steps include finding an appropriate office space, and setting up email addresses, printing business cards, and other related tasks. Lead: Sonja; Secondary: Adina Timeframe: January to February 2020 III. Form the Initial Board of Directors CFSB will institutionalize the community input it received during the planning stages into the new corporate entity in the form of a Board of Directors and related committees. We anticipate a Board with nine to thirteen members and others serving on appropriate committees. We will develop a Board matrix to identify the skills and representations that would be most helpful to have represented on the Board of Directors. We anticipate recruiting a diverse and inclusionary group of people who represent the City Government, Investors, Community Leaders, and Business Stakeholders. They should include people with a variety of credit, fundraising, marketing, nonprofit management, and CDFI skills and experiences. On January 16th, we will convene a representative group of community leaders to recommend people to sit on the Board. Once we receive these names, we will hone the list to a manageable number of people who meet the requirements of the Board matrix and begin the recruiting process. The Mayor of South Bend will appoint the initial Board, and after that it will be self -appointing. Once the Board is recruited, we anticipate an initial meeting in February and then a meeting every other month. During this time we will also determine the appropriate committee structure, appoint Board Members to the committees, and begin the process of recruiting any other required committee members. Lead: Adina; Secondary: Sonja & Mark Timeframe: January to June 2020 IV. Continue to seek and receive funding and investments We will continue the process of seeking funding for both the CFSB Capital Enhancement Fund and for operations. We will meet with potential sources, draft required proposals, and have needed follow up conversations, leading to funding and investment commitments. This process began in early December, based on the proposed CFSB Business Plan. The goal is to raise $TK for the Capital Fund and $TK for operations. Lead: Mark; Secondary: Sonja Timeframe: Initial Effort January to March, ongoing effort April to June 2020 V. Brand, Communications, and Marketing In order to effectively communicate it's message of bringing new capital and technical resources to South bend, CFSB will need an effective brand, message, and communications plan. We will work with the Board to create and approve a dynamic look and feel for the company including name, logo, tagline, and messaging. We will develop an initial communications plan, and launch a social media effort. We will create a website that is flexible and can be edited and augmented by future staff. Lead (shared): Mark & Sonja Timeframe: Initial Effort January to March, ongoing effort April to June 2020 VI,Hire Permanent Executive Director Perhaps the most important decision in the initial period of operation, is who to hire to become the permanent Executive Director. CDFI Friendly America will guide the Board of Directors throughout this process, including providing resources to craft a Job Description, determining the recruiting and hiring process, interview schedules, and how to make the offer. We will also develop and assist with the orientation process for the new Executive Director. We believe the new Executive Director can be in place by June 2020. Lead: Adina; Secondary: Sonja & Mark Timeframe: January to June 30, 2020 VII. Match making of Capital Seekers and Providers Throughout this six month process, CDFI Friendly America will continue to meet with capital seekers and sources, and track the results. We are currently tracking three types of loans to facilitate city programs and one deal to a private sector affordable housing organization. This will include meetings with referral sources, actual capital seekers, and CDFIs in the region, banks, and credit unions. It can include connecting borrowers directly to lenders or working with community organizations, including the City, to develop programmatic relationships. We will track all match making efforts from January —June 2020. Lead: Sonja; Secondary: Adina and Mark Timeframe: January to June 30, 2020 Proposed Timeline for CDFI Friendly South Bend Implementation: January -June 2020 Task Timeline and TaskP fmary ttin up CDFI Se ondary,Friendlyn Feb March April May June 1. Legal Formation & 501c3 status Sonja Adina II. Form Initial Board of Directors Sonja Adina III. Hold Initial Board Meetings Sonja Adina Transition Private Sector, including Mayor's approval, new IV. office, etc. Sonja Adina IV. Continue to seek and nail down funding V. Match -making for CDFI Friendly deals VI. Branding & Marketing VII. Hire permanent Director Vill. Project Management & Other Costs Mark Sonja Sonja Adina Sonja Mark Adina Mark Mark and Adina We developed the budget for this work using the same assumptions as under the existing contract. For that reason, we would bill time for the Principals in CDFI Friendly America at the III Vl a g e same $2,500/day (prorated by hour, as required) that the prior contract provided. We budget Sonja Karnovsky at $1,000/day (prorated as required). In addition, reasonable expenses (travel, lodging, incidentals) will be bill in addition to professional costs. Billing would occur on the last business day of each month based on actual days delivered and would be due within 30 calendar days. Our estimates include assumptions that CDFI Friendly America will seek to use the lowest possible cost approaches, including use of pro bono or City attorneys on legal matters, public and contributed spaces for meeting, etc. CDFI Friendly America will use materials given by others in the CDFI industry where possible, to minimize costs. The actual costs will vary if work is completed sooner than budgeted. For example, costs could decrease significantly if the new entity is able to hire a permanent Executive Director in less than six months, funders and investors step forward more readily than anticipated, or the founding Board of Directors requires less support than estimated. We estimate the following maximum time requirements of 27.25 days for Pinsky, 24 days for Abramowitz, and 58.5 days for Karnovsky. The maximum total costs for professional services would be $186,625 plus expenses. For the purposes of the budget under this agreement, however, we are seeking a contract of $125,000 + expenses for completion of the proposed scope of work. This assumes that we will achieve significant efficiencies in implementation, that we will deliver some of the goals earlier than anticipated, and that the Board of Directors will operate with the goal of completing this scope of work no later than June 30th. Unanticipated delays by the Board of Directors could increase the costs of implementation. We assume that the contract and its responsibility for the work of CDFI Friendly America will transfer to it from the City when the new entity is chartered, formed, and funded. Conclusion The purpose of this memo is to provide information to extend the November 13, 2018, contract to implement CDFI Friendly South Bend promptly and smoothly. Please let us know if you have any questions. Submitted on behalf of CDFI Friendly America, LLC By Mark A. Pinsky, Partner 240 East Evergreen Avenue Philadelphia, PA 19118 215-736-9525 r r rk xis. "y,—co tl 5'1F1age BOARD OF PUBLIC WORKS AGENDA ITEM REVIEW REQUEST FORM Date 1/21/2020 Name...._ Brian Donoghtie Department BPW Date 1/2 /2020 Phone Extension iwimuiww,v,mmnmuiuwwm.... rsiwura ., r�xermmmnv�iawiuw�uri Review and a�p� IT..., w� ' Prior to Submittal to Board Diversity Compliance ® Officer Name and Inclusion Officer BPW Attorney Attorney Name Dept. Attorney Z Attorney Name Purchasing z Check the Item " y c�C uir �� 1 Jbr° All Submissions . Professional Services Agreement ❑ Contract Open Market Contract Z Amendment/Addendum Bid Opening ] Bid Award Quote Opening El Quote Award Proposal Opening C/O & PCA No. n Chg. Order, No. Traffic Control Other: Company or Vendor Name New Vendor MBE/WBE Contractor Project Name Project Number Funding Source Account No. Amount Terms of Contract Purpose/Description Information Proposal Special Purchase, QPA El Req. to Advertise Reject Bids/Quotes ❑ PCA Resolution Ease./Encroach ❑ Title Sheei Five / Four Advisors ❑ Yes ❑ If Yes Approved by Purchasing hasing ® No MBE Completed E-Verify Form Attached ❑ Yes F] WBE ❑ No CDFI Friendlv City 19JO03 � Redevelopment General (Poka on 433.1050-460.39-30 November 15 2019 — December 31 2020 Update for CDFI Friendly contract with Phase 3 scope of work to impleme: CDFI Friendly South Bend, including board development and additional program management resources For ChL pe Orders Qnjy.::.. Amount of Increase $ Decrease ($ ) Previous Amount $ Increase % Current Percent of Change: Decrease _ ( % New Amount $ Increase % Total Percent of Change: Decrease_ % o Time Extension Amount: New Completion Date: ............�,,,.................�.Y... ............