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ORANGE COUNTY <br />BOARD OF COMMISSIONERS <br />ACTION AGENDA ITEM ABSTRACT <br />Meeting Date: <br />Action Agenda <br />Item No. ~- - hl-1 <br />SUBJECT: Contract to Prepare an Indirect Cost Plan <br />DEPARTMENT: Finance PUBLIC HEARING: (Y/N) No <br />ATTACHMENT(S): INFORMATION CONTACT: <br />Contract <br />Gary Humphreys 245-2453 <br />PURPOSE: To consider a contract with Maximus for preparation of a Cost Allocation Plan. <br />BACKGROUND: Federal regulations mandate a cost allocation plan prepared in accordance <br />with Federal regulations as a requirement to claim reimbursement for administrative or indirect <br />costs from a federal grant. The County contracts for the preparation of the cost allocation plan <br />which is used primarily to claim reimbursement of indirect costs for Child Support and Social <br />Services programs. Over $2.3 million in indirect costs were identified related to these two <br />programs in the last cost allocation plan. The plan is also used in conjunction with the <br />preparation of the EMS Medicaid Cost Report and to claim reimbursement in other areas where <br />a grant provides funding to pay indirect costs. <br />There are three firms which prepare cost allocation plans for most North Carolina governments. <br />Staff requested proposals from all three firms for preparing the Indirect Cost Plan for use in <br />Fiscal Year 2009-10 with an option to submit cost for the two subsequent years. The lowest <br />price was submitted by THM at $7,500. However the last time Orange County contracted for <br />this service with THM the firm did not deliver the report in a timely manner and was not <br />responsive to follow up communications regarding the report's completion. The report was <br />finally delivered over six months after the date stated in the contract. <br />Maximus submitted the second lowest price of $7,800. The fee quoted for the subsequent two <br />years was also $7,800. Maximus prepared the cost allocation Plan for a number of years prior to <br />the County's contract with THM. Staff recommends awarding a contract to Maximus to prepare <br />the indirect cost plan for the next three years subject to funding in the budget. <br />FINANCIAL IMPACT: The cost for preparation of the plan is $7,800 per year. The use of the <br />plan recovers nearly $1 million in additional grant revenue for the County. Funds are budgeted <br />in the Finance Department. <br />RECOMMENDATION(S): The Manager recommends the Board approve the 3 year contract <br />with Maximus for a cost allocation plan and authorize the Chair to sign. <br />