The Finance Division recently prepared an RFP for annual audit services. The RFP was advertised in the Billings Times on January 06 and January 13, 2011, and three Billings firms, one Bozeman firm and one Butte firm were sent copies.  The RFP asked for a six (6) year commitment and fee schedule, but the State limits contracts to three (3) years.  Staff is asking the City Council to approve the initial three year contract for FY 11-13 and authorize the Mayor to execute the second, three year term contract (FY14-16) when allowed by the State (after 7-1-13). 

Proposals were received from four firms to provide audit services for the City’s regular audit, the state compliance audit, the state mandated audit of the Building Inspection Fund and federally required audit of the Airport Passenger Facilities charge. The four firms were EideBailly, Joseph Eve, Anderson ZurMuehlen and Junkermier, Clark, Campanella and Stevens (JCCS).

The selection committee, consisting of Liz Kampa-Weatherwax, Sue Loomis, Jamie Wegner, Niki Stokki and Pat Weber, reviewed the proposals on Thursday February 03, 2011. The committee was split between EideBailly and JCCS, with JCCS getting three of the committee votes. The committee next opened the pricing proposals of JCCS and then EideBailly. The JCCS pricing proposal was less than EideBailly's by $10,900 over the initial 3 year contract term and $29,000 less over the six year period.

The two top firms and the fees quoted for each year are as follows:

Firm           FY 11        FY 12         FY 13         FY 14
JCCS        $58,000    $58,000    $61,000    $61,000
EideBailly $60,800    $62,600    $64,500    $67,000

Firm           FY 15         FY 16         Total
JCCS        $65,000    $65,000    $368,000
EideBailly $69,700    $72,400    $397,000

JCCS conducts audits for the Cities of Bozeman and Great Falls and several smaller cities in Montana. 

Council can approve the audit services contract with JCCS or not approve the contract.  If Council does not approve the contract, staff requests that Council provide guidance on how to select an auditor to fulfill the state obligation. 

The FY 10 cost for audit services was $59,000.  The proposed first year fee for JCCS is $58,000 and over six years, the contract is $29,000 less than the second place company proposal.  The audit is a General Fund expense but some of those costs are recaptured from other Funds through the Cost Allocation Plan.

The Committee recommends that City Council accept JCCS’s proposal based on their experience with similar sized cities and better pricing.