REPORT TO SHASTA COUNTY RTPA

SUBJECT	MEETING DATE	ITEM NUMBER
Authorize Executive Officer to Begin Request For Proposal (RFP) Process for Future Audits	02/25/03	3-5

RECOMMENDATION

It is recommended that the Agency:

1) Authorize the Executive Officer to prepare a Request for Proposal (RFP) and execute a contract with the successful Certified Public Accountant (CPA) to perform Compliance and Performance Audits for the Fiscal Years ending in 2003 through 2005.

SUMMARY

In accordance with the rules and regulations governing the Transportation Development Act (TDA) and state and federal planning funds, annual fiscal and compliance audits must be completed for the Transportation Planning Agency and each claimant, in addition to both the Local Transportation Fund (LTF) and State Transit Assistance (STA) Fund.

Audit responsibilities are awarded on a 3-year basis. The contract with Nystrom and Company expired with the completion of the June 30, 2002 fiscal audits. A request for proposal must be submitted to area CPA firms for the fiscal years of 2003, 2004 and 2005.

DISCUSSION

The RTPA has engaged the Redding firm of Nystrom and Company for the last three years. At this time we have developed a good working relationship with this firm. Past practice has been to engage an auditor on a three-year basis. Unless directed otherwise, we are prepared to distribute an RFP similar to that used in the past. The RFP will be distributed to all CPA firms in the Redding area as well as those firms outside the area that have indicated a desire to be included. Price will be the most important criteria in selecting the successful bidder since we expect all bidders to be qualified CPA firms.

ALTERNATIVES

Identified alternatives to the Staff recommendation are:

1) Do not distribute RFP and award future audit engagements to the existing auditor, Nystrom and Company. Whereas we have enjoyed our relationship with this firm, we feel very strongly in testing the market for professional services. We fully expect Nystrom and Company to submit a bid for this engagement. Agreeing on a price can be problematic. Through this process the market for these services will determine a fair price.

2) Distribute separate RFP=s for fiscal and compliance audits and performance audits. This alternative is not recommended due to the cost associated with hiring specialized consultants. It is estimated that the cost to engage a specialized consultant to perform performance audits of the RTPA and of RABA would be about $50,000. The cost to perform the most recent performance audits was $5,100.

OTHER AGENCY INVOLVEMENT

Upon acceptance, the audits will be forwarded to the State Controller's Office.

FINANCING

The submittal of the fiscal audit will have no financial impact. The cost of future audits can be determined after the RFP is distributed and responses received.

___________________________________

Daniel J. Kovacich, Executive Officer

SLC/jac

Attachment: Request for Proposal