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HomeMy WebLinkAbout20240604081328486BUZZELL ASSOCIATES Real Estate Appraisers & Consultants 9B Amy's Way * Gorham, Maine 04038 August 29, 2013 Armand J. Dufresne Senior Airport Planner Gale Associates, Inc. 15 Constitution Drive Bedford, New Hampshire 03110-6042 Phone/Fax (207) 839-6651 GALE ASSOCIATES,INC. Grp r�'.: 2013 DECEIVED RE: RFP Review Appraisal Services Mansfield Municipal Airport (Phase II) Mansfield, Massachusetts Job #777011 Dear Mr. Dufresne: First, I would like to thank you for the opportunity to submit this proposal relative td performing Review Appraisal Services on the above referenced project. I would like to note that my proposal is based upon my completing all aspects of the assignment. The completion time for the assignment, within the next 4t months can be done subject to timely, review replies and revisions by the appraiser. It is understood that Before and After Appraisals my be prepared for this assignment. My attached proposal is based on a per diem rate of $700.00 ($.87.50/hour) plus expenses which would also be applicable for additional time or services if necessary. Please advise me if additional submissions or information is needed. I look forward to your response. I Respectfully submitted, BUZZELL ASSOCIATES Leland E. Buzzell Maine Certified General Appraiser #CG-245 (12/31/13) /mfb Enclosure REVIEW APPRAISAL FEE ESTIMATES Mansfield Municipal Airport (Phase II) Mansfield, MA (Job #777011) Parcel Property Type Taking Estimated Fee 34-115 Vacant Land Easement $1,406 34-130 Improved Residential Easement 111A:0 Total $215:00; Work Order No. 8 Final Agreement — September 5, 2013 APPENDIX D SUBCONSULTANT FEE PROPOSAL (SURVEY) Merrill Associates September 1.8, 2013 MERRILL ASSOCIATES, INC. REGISTERED PROFESSIONAL ENGINEERS AND LAND SURVEYORS • ROBERT 0.MERRILL, P.E., LEED AP ! JOSHUA M: BOWS, P.E. . • PETER G. PALMIERI, P.E. - • DOUGLAS W. HEALD. P.E. - Gale Associates,. Inc. - - • DANA M. ALTOBELLO, P.E." - 15 COnStiiutlon Drive THOMAS A. POZERSKI, P.E., LEED AP Bedford, NH 03110 PETER E. TUTTLE, P.L.S. • PAUL T. GROVER, P.L.S. Attn: Mr. Matthew P. Caron; Airport Planner RE: Agreement for Professional Land Surveying and Consulting Services Mansfield Municipal Airport(1139) Preparation of Avigation Easement Plans and Descriptions Assessors Map 34 Lots 115 and 130 Dear Mr. Caron: Merrill Associates, Inc. (MAI) is pleased to submit the following proposalfor professional . land surveying and consulting services for the above -referenced' project. This proposal is based .on our understanding, of plans, calculations, and related .data pertinent to the ' scope. of work you wish to. have completed.. We appreciate you considering our firm and look.folward to working.with you on this project. Based on our telephone conversation and emails, we understand you require original mylar Easement Plans, suitable for recording, to be: used tocreate Avigation Easements by. and between Mansfield Municipal Airport and certain abutters. Work will. be in general compliance with the plan you provided via email entitled ''Phase -II Easement Acquisitions and survey services. outlined in B.IV in your e-mail of August 14, 2013. SCOPE OF WORK Specific work. items included in this proposal are as follows: 1. Prepare an easement base plan of the Airport and the abutting parcels involved by compiling existing and available record information. Some recent deed and plan. data is available in house. Additional, information will -be MWarched at the. Mansfield 'and Norton Town Halts and the Bristol County Registry of Deeds Northern District, 2. Prepare a draft Easement Plan based on the referenced plan provided; setting easement lines per client direction. Submit Draft' Plan for Gale's review and comment: . 3. Perform easement .area, metes and bounds calculations for each easement 427 COLUMBIA ROAD, HANOVER, MA 02339 - TEL. (781) 826-9200 • FAX (781) 826-6665 • EMAILsitedesI9n®merriIIina.C6m . . - Gale Associafes/Marshtleld Municipal Airport 9118113 - Page,2 of 3 - proposed. CADD draft Easement Plan. 4. Attend one site visit and Planning Board Meeting for each town. 5. Prepare written descriptions of each easement proposed for client use. 6. Record final easements at Bristol County Registry, of Deeds. Deliverables include original Mylar Easement Plans, 8 contact prints and draft written description of easements. FEE. MAI agrees to perform the work outlined above for fixed fee of $ 5,500. ADDITIONAL SERVICES . Additional services will be provided on an as -needed. basis. Additional services include any, task not specifically identified in the Scope of Work described .above, such as additional field survey, revisions of plans requested by the- client or the approving authorities, and meetings with the client or public officials. Additional services are billed on an hourly basis in. accordance with the attached Rate Schedule in effect at the time the work is performed. DIRECT EXPENSES The following direct reimbursable expensesi may apply: 1. Reproduction Costs Cost + 106/o 2: Computer Mylars/Plots $2000/sheet 3. Postage, Fed Ex, -UPS, or other reimbursable expenses Cost + 10% 4. Subcontractor Services (if needed) Cost.+ 10/0 5. Mileage: $,55:5/Mile PAYMENT SCHEDULE & DELIVERABLES 1. Retainer to accompany this agreement: None required. (applied to final invoice) 2, Payment in full for all services is required upon delivery of the Easement Plan, prints and descriptions. In the event of default in payment pursuant to this payment schedule:, you•agree to pay all reasonable attorneys' and collection costs; plus interest on any unpaid'invoice that is greater than thirty (30) days old in the amount of twelve percent (12%) per annum: As a: condition of this proposal and contract, deliverables to the client; shall consist of paper hard copies of the documents described herein. All original designs and documents, such as worksheets, field books, survey control, calculations, drawings, and CADD files, remain the property of MAI, excepting Mylar plans that may be required by approving authorities. The release of any original design documents,.such as CADD §§ - MERRILL ASSOCIATES, .INC. I`� j - REGISTERED PROFESSIONAL ENGINEERS �`` d([@I AND LAND SURVEYORS Gale Associales/Marshtield Municipal Airport 9118113. - _ Page 3 of 3 Files, to any other party shall be at the discretion of MAI and at the approval of the client .and shall be billed to the client under Additional Services to cover the cost. Should the municipality require the submittal of. CADD,.files of design and/or as -built plans, the cost to format and prepare these files shall be the responsibility of the client and will be billed to the client under Additional Services. We look forward to the opportunity of serving you on this project. Providing.the above as. : stated is acceptable, kindly sign,and return one copy of this proposal. Please call should you have any questions. This proposal is valid for 30 days. Please visit our website at www.merrillinc.com for more information. Very truly yours, MERRILL ASSOCIATES, INC. Peter.:E. Tuttle, P.L.S. Director of Land Survey Eno. Rate Schedule AGREEMENT ACCEPTED BY: Signature Date Name to be used for plans and applications Print Name Telephone Number Address for plans and applications A FAXED COPY SHALL BE CONSIDERED A CONTRACT. MERRILL ASSOCIATES, INC.I```� REGISTERED PROFESSIONAL ENGINEERS AND LAND SURVEYORS MERRILL ASSOCIATES, INC. REGISTERED PROFESSIONAL ENGINEERS &LAND SURVEYORS Rate Schedule Effective January 1, 2013 - December 31, 2013 ENGINEERING Principal Engineer $150.00/hour Senior Project Manager $130.00-$140.00/hour Project Engineer $110.00-$120.00/hour Design Engineer $80.00 - $100.00/hour Engineering Technician $70.00/hour CADD Designer $75.00 - $85.00/hour Technical Support Staff $50.00 - $65.00/hour SURVEY Professional Surveyor $130,00/hour Surveyor $80.00 - $100.00/hour 1-Man Survey Crew - Robotic/GPS $110.00/hour 2-Man Survey Crew $135.00/hour 2-Man Survey Crew —. Prevailing Wage $145.00 - $205.00/hour Truck Usage and Mileage Standard IRS Mileage Rate, (Currently 0.55/mile) NIGHT MEETINGS & SERVICES (AFTER 6:00 PM) The Standard Rate Schedule above is for services provided during normal business hours (7:00 AM — 6:00 PM). Night meetings and presentation work or any services required after 6:00 PM will be billed at 1.5 times the standard rate with a 2-hour minimum, including travel time. EXPERT WITNESS Billed at 2.0 times the standard rate with 4-hour minimum, including travel time. MERRILL ASSOCIATES, INC. REGISTERED PROAND'LAND SU VIEYOR$ I I `��`` Work Order No. 8 Final Agreement — September 5, 2013 APPENDIX E SUBCONSULTANT FEE PROPOSAL (LEGAL) Robert L. Marzelli, Attorney at Law ROBERT L. MARZELLI ATTORNEY AT LAW September 10, 2013 Mr. Matthew P. Caron Airport Planner Gale Associates, Inc. 15 Constitution Drive Bedford, N.H. 03110 1020 PLAN STAFF.I' SUITE 380 MARSHFIELD, MA 02050 T" re"O.- 781- 837 - 3636 FAx 781- 837 - 9245 RE: Mansfield Municipal Airport — Easement Acquisition Project — Phase II Proposal To Provide Legal Services Dear Matt: This is in response to your email request for a proposal to provide Legal Services in connection with the acquisition of easements over land abutting the Mansfield Municipal Airport. You have requested that I provide a "not -to -exceed" budget for the work described in Paragraph B.V of Gale's Proposal, a copy of which you have provided to me. You have also provided to me a plan entitled "Phase 11 Easement Acquisitions", which I have relied on in formulating my proposal. The proposal assumes, based on that plan that there are two parcels; one large and one quite smaller, over which the Airport wishes to acquire avigation easements. As you know it can be difficult to determine precisely how much time will be spent resolving legal issues until title searches are completed and the attitude of landowners whose properly is being acquired can be determined. So the amounts in the proposal are necessarily estimates: However I have tried to allow for unexpected contingencies in the proposed budget. All my time would be billed at $250 per hour. My proposal follows: B.V- Legal Services: This task includes legal services necessary to review, coordinate, negotiate and interpret legal matters and easement closings, a) Prepare a preliminary title abstract for each property where an easement is to be acquired. The abstract must be provided to the appraiser before the appraiser begins work. The purpose of the abstract is to identify whether the property(s) contain encumbrances, such as other easements, that could interfere with the operation of the avigation easement. (Marzelli) - $2000 b) Coordinating the work of the legal services subconsultant through telephone calls, emails, or other means, reviewing work products, and coordinating required changes in work products. (Gale) c) Provide a review of each "tree clearing agreement" where such is necessary. Gale will provide a sample agreement including plan to assist legal counsel's familiarity with these plans. Gale will provide a draft agreement and plan for counsel review. (Marzelli) - $1000 d) Assist Gale and the airport in its negotiations with each owner where required. This typically takes the form or revising easement language to reflect the property owners preferences or requirements, or similar tasks. (Marzelli) - $1000 e) Provide general coordination services with Gale and authorized airport personnel and additional coordination in negotiations for easements including: discussion of easement clauses; review of administrative settlement requests, etc. (Marzelli) - $1500 f) Review written offers drafted by Gale. (Marzelli) - $500 g) Prepare agreements with the Town of Mansfield for access on or through Town owned property, and for tree clearing. (Marzelli) - $1000 h) Review draft avigation easements provided by Gale and property descriptions provided by the Surveyor to ensure suitability for recording and closing. (Marzelli) i) Provide legal guidance to the project team to ensure compliance with all applicable Federal, State, and local requirements. (Marzelli) - $1000 j) Reviewing the final certificates of title. (Gale) k) Forwarding certificates of title and recorded deeds to FAA and Aeronautics. These will be included in the final reimbursement request submitted for the project. (Gale) 1) Perform the closings and necessary associated work on the final easements in conjunction with the project Negotiator including providing an update of the title immediately prior to the closing. All recording and closing fees shall be paid by legal counsel at the time of closing and reimbursed to legal counsel.(Marzelli) - '$2500 TOTAL BUDGETED NOT -TO -EXCEED AMOUNT = $10,500 S y ob L. M ze RLM/m Work Order No. 8 Final Agreement — September 5, 2013 APPENDIX F SUBCONSULTANT FEE PROPOSAL (ARCHAE OLOGICALMISTORICAL) Archaeological and Historical Services, Inc. Archaeological and Historical Services, Inc. 569 Middle Turnpike ♦ P.O. Box 543 ♦ Storrs, CT 06268 www.ahs-inc.biz August 28, 2013 Mr. Matthew Caron Gale Associates, Inc. 15 Constitution Drive Bedford, NH 03110 Re: Phase IA Cultural Resource Survey Phase II Easement Acquisitions and Permitting Plan Mansfield Municipal Airport Mansfield, MA Dear Mr. Caron: AHS is pleased to present this proposal to conduct a Phase IA archaeological reconnaissance survey of the above -referenced projects. The reconnaissance survey would include evaluation of the potential of the Area of Potential Effect (APE), which includes approximately eight (8) locations, to contain significant archaeological (subsurface) or historic resources. The survey will follow the guidelines of the Massachusetts Historical Commission (MHC) and M.G.L. 950 CMR 70.0. The tasks of the survey will include small-scale archival research in historic maps, published histories, the MHC site files, and in cultural resource management technical reports on file at MHC. A walkover survey of the APE locations will also be conducted in order to determine whether above- ground historic structures are present, or whether surficial remains or environmental characteristics indicate subsurface integrity and the potential for intact below -ground archaeological resources to be present. AHS will prepare an archaeological sensitivity map, on which areas of relative archaeological sensitivity are indicated, as well as a technical report of our findings and recommendations. The fee for the Phase IA survey would not exceed $11,000.00. Should you have any questions, please do not hesitate to contact me. Sincerely, Mar er Y P President MGHhIb Via e-mail AHS, Inc. Phone: 860-429-2142 ♦ Pax: 860-429-1724 ♦ E-Mail: infb@ahs-inc.biz Work Order No. S Final Agreement - September 5, 2013 APPENDIX G SUBCONSULTANT FEE PROPOSAL (ENVIRONMENTAL) GZA GeoEnvironmental, Inc. GZ\ ONE FINANCIAL PLAZA 1350 Main Street Suite 1400 Springfield Massachusetts 01103 413.726-2100 FAX 413-732-1249 �.gzaxcmn GZA GeoEnvironmental, Inc. September 3, 2013 15.0166309.20 Mr. Matt Caron, Airport Planner Gale Associates, Inc. 15 Constitution Dr. Bedford, NH 03110-6042 Engineers and Scientists RE: Mansfield Airport VMP Wetland Permitting in Town of Mansfield. Mansfield, Massachusetts Dear Matt: As per your request, GZA GeoEnvironmental, Inc. (GZA) is providing this scope and fee estimate for environmental support work for VMP wetland permitting at Mansfield Airport, in the Town of Mansfield, MA. The anticipated tasks will include support work in three main components: 1. Wetland delineation for all Mansfield VMA areas intended for clearing under this proposal (as per VMP areas identified in email from Gale dated 08/27/13) 2. Preparation of wetlands Notice of Intent (NOI) Submission to the Mansfield Conservation Commission for the proposed tree clearing, 3. Attendance of one field walk and up to two (2) public hearing meetings in support of the application, and 4. Interpretation and filling of Orders of Conditions at the Registry of Deeds for the project. The Original VMP was prepared and submitted in 2000, and subsequent 5-Year, Yearly Operational Plan in 2005. A VMP Update was prepared in 2013 and is assumed to be the program that will be implemented as pail of the permit application. Based upon our understanding of the project and likely permit requirements we propose the following scope of services. A person -hour estimate and cost matrix is attached. SCOPE OF SERVICES: B.VII — Permitting: The purpose of this task is to obtain, prepare and submit the information necessary for application to the Mansfield Conservation Commission (MCC) for an Order of Conditions under the Massachusetts Wetlands Protection Act (WPA; 310 CMR 10.00) and the Mansfield Wetland Bylaws (MWB) and to attend required public hearings and field walks in support of the ,project. GZA will work with Gale (the ENGINEER) in this regard. Such work will include coordination with the MCC in the development of Orders of 'Conditions for the VMP work and address filing with the Registry of Deeds, as required. GZA cannot guarantee that the MCC will approve the required Orders of Conditions; however this task is to assist in the application, hearing and post hearing phases of permitting. Additionally, this task will include efforts to seek agreements with the Town of Mansfield for the purpose of future tree clearing, and access Copyright© 2013 GZA GeoEnvironmental, Inc. An Equal Opportunity Employer WF/V/H Mansfield Airport VMP Wetland Permitting in Town of Mansfield September 3, 2013 15.0166309.20 Page 2 of 4 on Town owned parcels. This task assumes that the existing VMP Update (April 2013) for the Airport will meet the requirements under 310 CMR 10.53(3) (n) for limited project status. a), GZA will work with Gale, providing input during the preparation of detailed plans of the trees to be cleared including a site visit in preparation for a site meeting with the MCC agent. rion Estimated GZA Fee & Direct costs: $1,400 b). Meeting with the Mansfield Conservation Agent at the site to discuss the scope of the tree clearing necessary and to obtain knowledge of any specific requirements of the MCC (Assumes 2 meetings). Estimated GZA Fee & Direct costs: $2,100 c). Updating, delineating/ locating the wetland resources within the VMP areas under this project and documenting the resource properties (e.g., vernal pool boundaries, if appropriate), flagging such resources, preparation of documentation for the delineation, and transmitting the sketch map information to Gale for survey location. Estimated GZA Fee & Direct costs: $6,050 d). Preparing the draft Notice of Intent applications including a narrative description of the wetland resources, description of impacts and overall project; and an abutters list and notification documentation; and submission of all necessary copies in support of application. Gale is assumed to provide all necessary engineering related information in support of the application preparation. The draft application will be provided to Gale for review and edits. Estimated GZA Fee & Direct costs: $5,750 e). Final preparation of the NOI application, submission, and coordinating with Gale. The copies to MDEP-SERO and NHESP (only if required; not required based upon January 2013 NHESP mapping), and sending certified notification (or certificate of notice, as required and allowed) to abutters (does not include requests for copies from abutters). Abutters will be provided electronic emailed copies free of charge, but bound copies if requested will be provided for a separate fee.) Estimated GZA Fee & Direct costs: $2,625 f). Attend the public hearing (two hearings are assumed, a single field walk) with the MCC. Gale is assumed to provide all engineering responses as well as explaining the aviation purpose and need for the project. GZA will prepare for each meeting, Mansfield Airport VMP Wetland Permitting in Town of Mansfield September 3, 2013 15.0166309.20 Page 3 of 4 explain the wetland information (including impacts) to the MCC and respond to questions. Estimated GZA Fee & Direct costs: $3,025 g). Receive, review and record the Orders of Conditions in the Registry of Deeds, and ` apply for a Certificate of Compliance upon work completion. Discuss any project JLX restrictions with Airport and discuss implications, if any, on the conduct of the work. Estimated GZA Fee & Direct costs: $1,700 Total Estimated GZA Fee & Direct costs: $22,650 SCHEDULE GZA will schedule the work immediately upon receipt of a contract with Gale. We will maintain regular communication with you so that issues and concerns are addressed on a timely basis. BUDGET AND BASIS OF BILLINGS GZA proposes to provide the above Tasks under Articles B.1 on a lump sum basis as indicated in the attached fee estimate. The total Lump Sum, Not to Exceed for the above scoped work, would equal Twenty Three Thousand Dollars One Hundred Fifty ($23,150) for all work. The fee is based on the anticipated scope of work outlined above, which represents our present judgment as to the level of effort required. You will be notified of any unanticipated conditions requiring an increase in the fee as soon as they become evident. ASSUMPTIONS The following assumptions were made in the preparation of this proposal: 1) The 2013 VMP Update (April 2013) for the Airport will meet the requirements under 310 CMR 10.53(3)(n) for limited project status. 2) Gale Associates will be responsible for all final plans to accompany the NOI Submission. 3) Rights of access to all off airport VMP parcels is to be provided by others. CONDITIONS OF ENGAGEMENT Conditions of engagement and Terms and Conditions are as described in GZA's existing contract with Gale. Mansfield Airport VMP Wetland Permitting in Town of Mansfield September 3, 2013 15.0166309.20 Page 4 of 4 ACCEPTANCE Acceptance of this Proposal may be indicated by signing in the appropriate space and returning one copy to us. We appreciate the opportunity to continue to work with Gale at Mansfield Airport on this G� effort. Should you have any questions regarding this scope of services, do not hesitate to contact this office. Very truly yours, GZA GeoEn ironmenta , Inc. R erdy St*an Project Ecologist oiewer' 21G.avis, Ph.D. Principal -in -Charge Proposal Acceptance & Notice to Proceed: For Gale Associates, Inc. Date Work Order No. 8 Final Agreement — September 5, 2013 APPENDIX H AUDITED OVERHEAD RATE Gale Associates, Inc. Defense Contract Audit Agency United States Department of Defense August 5, 2011 Independent Parts of a Proposal Audit of Gale Associates, Inc.'s InMmite Delivery Indefinite Quantity Firm Fixed Price Proposal for Architectural and Engineering Services AUDIT REPORT NO. Z171 201IN27000001 RBSTRICTIONS a 1. The contents of this audit report should not be released or disclosed, other than to those persons whose official duties require access in accordance with DoD 5200.1=It, Information Security, 7amuary 1997, Appendix 3, paragraph AP3.2.3. This document may contain information exempt from mandatory disclosure under the Freedom of Information Act. Exemption 4, of the Freedom of Information Act, which addresses proprietary information, may apply. It is not practical to identify during the conduct of the audit those elements of the data which are proprietary. Proprietary determinations should be made in the event of an external request for access. Unauthorized disclosure of proprietary information violates 18 U.S.C. 1905 aud,•if the information is contractor bid or proposal or source selection information, 41 U.S.C. 423. Any person who unlawfully discloses such information is subject to penalties such as fines, imprisonment, and/or removal from office or employment. FOR OFFICIAL USZ ONLY Audit Report No. 2171-201IN27000001 2. Under the provisions of Title 32, Code of Federal Regulations, Part 290.7(b), DCAA will refer any Freedom of Information Act requests for audit reports received to the cognizant contracting agency for determination as to releasability and a direct response to the requestor. 3. The Defense Contract Audit Agency has no objection to the release of this report, at the discretion of the contracting agency, to authorized representatives of Gale. 4. Do not use the information contained in this audit report for purposes other than action on the subject of this audit without first discussing its applicability with the auditor. I FOR OFFICIAL USE ONLY Audit'Report No. 2171-2011NZ7000001 DEFENSE CONTRACT AUDIT AGENCY PREPARED FOR: Commanding Officer ATTN: Ms. Robbin Henry, Contract Specialist Department of the Navy Naval Facilities Engineering Command Mid -Atlantic 9742 Maryland Avenue Norfolk, VA 23511-3095 PREPARED BY: DCAA Boston Branch Office 495 Summer Street, Suite 336 Boston, MA 02210-2192 Telephone No. (617) 753-3777 FAX No. (617) 753-3404 E-mail Address dcaa-fao2171@dcaa.mil REFERENCES: Relevant Dates: See Page 12 CONTRACTOR: Gale Associates, Inc. 163 Libbey Parkway Weymouth, MA 02189-3101 CONTENTS: Subject of Audit of Parts of a Proposal Scope of Audit of Parts of a Proposal Results of Audit of Parts of a Proposal Contractor Organization and Systems DCAA Personnel and Report Authorization Audit Report Distribution FOR OFFICIAL USE ONLY Pave 1 1 2 11 12 13 Audit Report No. 2171-201IN27000001 SUBJECT OF AUDIT OF PARTS OF A PROPOSAL As requested by:Ms ,deny, Robbin, Contract Specialist, on April 13, 2011, we examined the proposed direct labor rates, labor escalation factor and indirect cost rate portion of Gale Associates, inc's (Gale) Indefinite;Delivery. "Indefinite Quantity (IDIQ) Firm.Fixed Price proposal, not to exceed $10,000,000, dated 'February 15, 2011, with updated assertions and basis of estimates received on June 6, 2011, to determine if'th'e parts of the.proposal examined are acceptable as a; basisao. negotiate a fair and reasonabiecontract price. Gale submitted the proposal for Bugineering and Architectural Services in response to Solicitation No. N40085-10- R-9421, whioli has been: negotiated: into Contract No. N40085-11-D-7207, dated June 2, 2011, subject to downward adjustment based on this audit report. The company's contractual performance for the base period is June 2, 2011 through June 1, 2012, with four subsequent option periods. The proposed direct labor rates, labor escalation factor and indirect cost rate and related cost or pricing data are the responsibility of the contractor. Our responsibility is to express an opinion on the proposed direct labor rates, labor escalation factor and indirect cost rate based on our examination. SCOPE OF AUDIT OF PARTS OF A PROPOSAL As requested, we limited our examination to the proposed direct labor rates, labor escalation factor and indirect cost rate. We conducted our examination in accordance with Generally Accepted Government Auditing Standard`s (GAGAS), except.DCAAdoes not. currently have an external opinion on its qu6lity oontrol systom as required by GAGAS 3.55. The most recent external quality control reYiow opinion expired on August 26, 2009 GA i .'S require that we plan and perform the examination to obtaln:reasonable assurance about Whether the part(s) of the proposal examined are free of material misstatement. An examination includes: • obtaining an understanding of the contractor's internal controls, assessing control risk, and determining the extent of audit testing needed based on the control risk assessment, • examining, on a test basis, evidence supporting the amounts•and disclosures for the parts of the proposal examined, • assessing the accounting principles used and significant estimates made by the contractor in developing the proposed amounts for the parts of the proposal examined, • evaluating the overall presentation for those parts; and • determining the need for technical specialist assistance for the parts of proposal examined. FOR OFFICIAL USE ONLY Audit Report No. 2171-2011N27000001 We evaluated the proposed direct labor rates, labor escalation factor and indirect cost rate 1 using the applicable requirements contained in the: • Federal Acquisition Regulation (FAR) and • Cost Accounting Standards (CAS) -Modified Coverage We have neither specifically examined Gale's accounting system internal controls not have we examined its estimating system and its related internal controls (see Contractor Organization and Systems section). The scope of our examination reflects our assessment of control risk and includes tests of compliance with applicable laws and regulations that we believe provide a reasonable basis for our opinion. RESULTS OF AUDIT OF PARTS OF A PROPOSAL In our opinion, the offeror has submitted adequate cost or pricing data. The direct labor rates, labor escalation factor and indirect cost rate were not prepared in all respects in accordance with the appropriate provisions of FAR Part 31(see comments on page 5, Exhibit A, Note 2 and pages 8 through 10, Exhibit B,'Notes 3 through 4). however, the nonoompliances are considered to have a limited impact on the direct labor rates, labor escalation factor and indirect cost rate taken as a whole. Because the FAIL noncompliances are considered to have a limited impact, we believe that the direct labor rates, labor escalation factor and indirect cost rate are an acceptable basis for negotiation -of fair and reasonable price. This report is limited to the direct labor rates, labor escalation factor and indirect cost rate. Accordingly, we express no opinion on the contractor's proposal taken as a whole. We discussed factual matters concerning our findings with Mr. Bruce White, Director of Finance, in an exit conference held on July 25, 2011. The contractor concurred to the factual matters supporting our audit findings. We did not provide the dollar impact of our findings. 2. FOR OFFICIAL USE ONLY Audit Report No. 2171-201IN27000001 . ......... Rate Evaluation: Proposed. yacq4k(?E llmos..J.Exhlb - Overhead Rate t, FlUb 3. F OR OFFICIAL USE ONLY Audit Report No. 2171-201IN27000001 E)MIBIT A Page 1 of 3 SUMMARY OF PROPOSED, QUESTIONED AND DIFFERE NCR IN AVERAGE DIRECT LABOR RATES 0 4 FOR OFFICIAL USE ONLY Audit Report No. 2171-2011N27000001 EXPLANATORY NOTES: Difference EXHIBIT A Page 2 of 3 The amounts shown in this table are presented solely for the convenience of the procurement activity in developing its negotiation objective. They represent only the arithmetic difference between the amounts proposed and the related questioned amounts. You should not consider the amounts to be audit approved or recommended amounts. DCAA does not approve or recommend prospective costs because amounts depend on factors outside the realm of accounting expertise, such as opinions on technical and production matters. 2. Average Direct Labor Rates a. Summary of Conclusions: Our questioned average labor rates are based on the following table showing the proposed, audit determined and questioned escalation factors: 21 scalation Proposed (a) 3.50% Audit Determined (b) 2.950/0 Questioned (a) - (b) We questioned .55 percent of Gale's proposed 3.50 percent annual escalation factor. The audit determined escalation factor o£2.95 percent is based on a four year average from Global Insight, relative to New England, for an Average Annual Wage, in the Private Service Providing, from FY 2012 through FY 2015. Gale claimed that its proposed escalation factor was based on prior history. However, during our audit procedures, we determined that they could not reasonably demonstrate incurring an historical average escalation factor of 3.50 percent. Since contractor history in this case, was inconsistent, we relied on Global insight to provide the best indicator of future escalation. Asa result, we have questioned the differenec between the proposed escalation factor and the four year average Global Insight escalation factor, based on FAIL 31.201-3 Determining reasonableness, which states: "(a) A cost is reasonable (f, in its nature and amount, it does not exceed that which would be incurred by a prudent person in the conduct of competitive business. Reasonableness ofspecific costs must be examined with particular care in connection with firms or their separate divisions that may not be subject to effective competttive restraints. No presumption of reasonableness shall be attached to the incurrence of costs by a contractor. If an Initial review of the facts results in a challenge of a specific cost by the contracting officer or the contraoting officer's representative (DCAA), the burden of proofshall be upon the contractor to establish that such cost is reasonable. " FOR OFFICIAL USE ONLY Audit Report No. 2171-201IN27000001 b. Basis of Contractor's Cost: EXHIBIT A Page 3 of 3 Gale proposed 8 labor categories ranging from Principal to Clerical. Each respective labor category is a simple average of the employees' rates within the respective category. The PY 2011 average direct labor rates were derived from their employee's actual payroll rate as:of June 4, 2011; FY 20I i is the base year. From the simple average rate calculated for FY 2011 Gale then applies their proposed annual 3.50 percent escalation factor (which was asserted to be based on history) to calculate the proposed rate for FY 2Q12 and continues this process to calculate a rate for each tabor category through PY 2015. c. Audit Evaluation: During our audit evaluation we performed the following: • We documented our understanding of the basis of the proposed rates. • We determined whether the proposed labor categories are consistent with labor categories used in reporting and accumulating direct labor. • We evaluated Gale's method of developing the proposed gates. • We evaluated the proposed escalation factor and the reasonableness of rates considering history and Global Insight projections. • We computed a four year Global Insight escalation factor for PY 2012 through FY 2015. ' • We verified base year pay rates for all proposed individuals to payroll documentation. • We reviewed labor utilization reports for all proposed employees for the 12 month periods ended December 31, 2008, December 31, 2009, December 31, 2010 and the six month period ended June 30, 2011, to determine the impact of recommending a weighted average as compared to the proposed simple average labor rate calculation, which yielded no material differences. • We reviewed their proposed average direct labor rates for compliance with FAR Part 31 Cost Principles. • We determined that an average Global Insight projection was more reasonable than Gale's proposed labor escalation factor. • We questioned the difference between the proposed simple average labor rates, escalated at 3.50 percent for the proposed contract period and our per audit simple average labor rates computed with an average Global Insight projection for the proposed contract period. 0 FOR OFFICIAL USE ONLY Audit Report No. 2171-201IN27000001 PXHIBIT B Page 1 of 4 SUMMARY OF PROPOSED, QUESTIONED AND DIFFERENCE IN OVERHBAD RATE 7 FOR OFFICIAL USE ONLY Audit Report No. 2171-201IN27000001 EXHIBIT B Page 2 of 4 EXPLANTARY NOTES: 1. Difference See Exhibit A, Note 1, Page 5 2. FY 2011 through FY 2015 Average Indirect Cost Rate a. Summary of Conclusions: We accepted Gale's assertion that an average indirect cost rate based on FY 2008, FY 2009 and FY 2010 was used for the proposed contract period of performance. We made further downward adjustments to their proposed indirect cost rate based on our audit evaluation. Using the questioned cost amounts identified in Notes 3 through 4, we computed the per audit average overhead cost rate for FY 2008, FY 2009 and FY 2010, to be used for the base period and four option periods. We questioned the difference between the proposed average indirect cost rate and the indirect cost rate per audit. b. Basis of Contractor's Cost: Gale's proposed overhead cost rate is based on an average of their actual FY 2008, FY 2009, and FY 2010 overhead cost rates. This average overhead rate was proposed for the base period, as well as for the four option periods (FY 2011 through FY 2015). On May 31, 2011, DCAA deemed their proposal to be inadequate primarily due to the lack of indirect cost budgetary data and or / basis of assertions for proposing historical indirect rates for the proposed contract period of performance. On June 6, 2011, Gale asserted that historical indirect cost data was the best indicator of future performance, while also affirming that their overhead rate remain relatively.eonsistent on an annual basis. We evaluated this assertion during our audit evaluation. Their indirect rates for (FY 2008, FY 2009 and FY 2010) included voluntary deletions from the overhead cost pools in each year, which averaged 27 percent of their gross overhead expenses. Gale utilizes a calendar year end for financial reporting and computing its year-end overhead cost rate. Gale utilizes a single overhead rate structure and accumulates their indirect expenses -under General Ledger Account Series 7XX.00 and allocates them over direct labor which is accumulated within General Ledger Account Number 602.00 c. Audit Evaluation: Our audit evaluation consisted of the following: • We, ascertained the basis of the proposed indirect cost rate, for the proposed period of performance. • We evaluated the reasonableness of Gale's assertion that their proposed indirect cost rate (made up of an average of their FY 2008, FY 2009 and FY 2010 actual indirect rates, net of unallowable costs) was comparable and in -line with their historical experience. 8 FOR OFFICIAL USE ONLY Audit Report No. 2171-201IN27000001 EXHIBIT B Page 3 of 4 i We discussed and documented the approximate impact on Gale's staffing levels (overhead base), associated variable indirect expenses and any additional fixed expenses that would be incurred upon receipt of this award. We determined this award would have little impact on incremental revenues and expenses, as this award would more or less be a follow-on contract to a prior Navy contract that was ending. • Based on discussions the contractor, we determined that evaluating year to date VY 2011 indirect expenses and direct labor, would depict an incomplete picture due to the non -cyclical nature of their business. Thus we focused on evaluating historical indirect rates with considerations of changes in future revenues, labor and associated expenses. • We ensured that the period for the proposed rates were consistent with.Gale's historical rate period. • We performed a comparative analysis of Gale's historical indirect rates and followed up on noted variances and high risk accounts. • We reconciled the proposed overhead'pooi costs to Gale's PY 2008, PY 2009 and FY 2010 Adjusted Trial Balances. • We performed a mathematical verification of the claimed pool and base amounts. • We selected cost accounts within the overhead pool for transaction testing, based on our risk assessment and comparative analysis. • We judgmentally selected transactions to test from the cost accounts selected, • We requested and obtained supporting source documentation for transactions selected for review, such as: original invoices, rental agreements, check detail and payment details, etc. • We reviewed the transactions selected, hs well as the overall indirect rate structures, for compliance with applicable PAR Part 31 Cost Principles. • We computed a per audit average overhead rate, which incorporates the audit exceptions noted in Notes 3 through 4, within this Exhibit, • We questioned the difference between the proposed average overhead rate and our per audit average overhead rate. 3. PY 2008, PY 2009 and PY 2010 — Office Expense: HRC a. Summary of Conclusions: We questioned this account in its entirety, in each fiscal year, representing $22,381, $21,497 and $29,080, respectively, of the claimed PY 2008, FY 2009 and FY 2010 Office Expense: HRC costs, within General Ledger Account No. 742, These costs, in each year, pertained to company picnics, golf outings, holiday parties, barbeques, as well as directly associated miscellaneous supplies and costs. These costs represent social activities, which are unallowable per PAR 31,205-14 Entertainment costs, which states: FOR OFFICIAL USE ONLY Audit Report No. 2171-2011N27000001 EXHIBIT B Page 4 of 4 "Costs of amusement, diversions, social activities, and any directly associated costs such as tickets to shows or sports events, meals, lodging, rentals, transportation, and gratuities are unallowable. Costs made specUically unallowable under this cost principal are not allowable under any other cost principal. " b. Basis of Contractor's Cost: The claimed actual Office Expense costs were accumulated under the General Ledger Account Number 742, for FY 2008, FY 2009, and FY 2010. (Refer to Note 2, Basis of Contractor's Cost, which explains how Gale proposed an average overhead rate of FY 2008, FY 2009 and FY 2010., for the base period and four option periods.) c. Audit Evaluation: Refer totxlubit B, Note 2, Page 8 4. FY 2008, FY 2009 and FY 2010 — Professional Meetings a. Summary of Conclusions: We questioned $800, $10,879 and $3,791, respectively, of the claimed FY 2008, FY 2009 and FY 2010 Professional Meetings costs, within General Ledger Account No. 732. The questioned costs, in FY 2008 and FY 2010, pertain exclusively to golf outings. The questioned costs in FY 2009 relate to various golf outings and a portion of an Eastern College Athletic Conference (ECAC), held in Hyannis, MA. Gale and three other companies sponsored the conference, which was held from October 4, 2009 through October 6, 2009. We identified that approximately 75 percent of these claimed costs were unallowable entertainment costs (golfing, clambakes, awards dinner, etc.) The remaining costs were allowable trade show and convention related costs. All of the question costs within this account represent social activities, which are unallowable per FAR 31.205-14 Entertainment costs, which states: "Costs of amusement, diversions, social activities, and any directly, associated costs such as tickets to shows or sports events, meals, lodging, rentals, transportation, and gratuities are unallowable. Costs made specifically unallowable under this cost principal are not allowable under any other cost prinetpal. " b. Basis of Contractor's Cost: The claimed actual Professional Meeting costs were accumulated under the General Ledger Account Number 732, for FY 2008, FY 2009, and FY 2010, (Refer to Note 2, Basis of Contractor's Cost, which explains how Gale proposed an average overhead rate of FY 2008, FY 2009 and PY 2010, for the base period and four option periods.) c. Audit Evaluation: Refer to Exhibit B, Note 2, Page 8 10 FOR OFFICIAL USE ONLY Audit Report No. 2171-2011N27000001 CONTRACTOR ORGANIZATION AND SYSTEMS 1. Organization Gale Associates, Inc. (Gale) is located in Weymouth, MA and was founded in Massachusetts in 1964. Gale is a closely held C- Corporation. Gale provides architecture and engineering professional services. Sales for period ended December 31, 2010 were approximately $15 million. Of their reported sales, 67 percent were with commercial customers, 15 percent with the Department'of the Navy, and 18 percent with other Government agencies (state and local). Gale has their financial statements and tax returns prepared by QRGA, LLP. Currently, Gate employs approximately 100 employees with the majority working in the Weymouth, MA headquarters and the remainder dispersed in smaller offices in Maryland, Florida and California. 2. Accounting System We have not previously evaluated the Gale's accounting system for determining whether their accounting system is considered generally adequate for identifying, accumulating, and reporting costs on government contracts. Therefore, we express no opinion on the adequacy of the contractor's accounting system. Gale utilizes Deltek accounting software. The accounting system is capable of segregating direct versus indirect costs. Direct costs are tracked by project. Direct and Indirect labor charges are supported by electronic timesheets. Indirect costs are applied to projects using a predetermined overhead rate. Unallowable costs are removed after point of entry and are removed from the overhead rate calculation. The contractor's process is to identify unallowable costs in their General Ledger Accounts based on FAR Part 31 and then identify and exclude directly associated costs. The following is a schedule of Gale's indirect cost pool and applicable allocation base: Indirect Cost Pool Allocation Base All Indirect Expenses Total Direct Labor Dollars 3. Estimating System Our office has never reviewed the contractor's estimating system. Accordingly, we are unable to render an overall opinion on the adequacy of its estimating system as a whole. FOR OFFICIAL USE ONLY Audit Report No, 2171-2011N27000001 DCAA PERSONNEL Primary contacts regarding this audit: Jeremy D. Held, Senior Auditor Peter Flynn, Auditor Edward T. Fleming, Supervisory Auditor Other contacts regarding this audit report: John F. Gay, Branch Manager Kim Grimstead, Financial Liaison Advisor Boston Branch Office Kim Grimstead, Financial Liaison Advisor Telephone No. (617)753-3689 (617) 753-3699 (617)753-3373 (617)753-3777 (757) 322-4082 FAX No. (617)753-3404 (757)322-4068 -mail Address Boston Branch Office deaa-&o2l71@doaa.mil General information on audit matters -is available at http://www.doaa.miV. RELEVANT DATES Audit Request Date: April 13, 2011 Initial Requested Due Date: May 12, 2011 Adequate Proposal Received: Juno 6, 2011 Coordinated/Revised Due Date: July 31, 2011 Coordinated/Revised Duo Date Extension to: August 5, 2011 AUDIT REPORT AUTHORIZED BY: G AY. O H N . F , Digltallyslgnadby GAYJOHN.F.1226573309 DN: c us, o=u s. Government, c 1228573309 o PK"oO=DcA& cn GAYJOHN.F.1220573309 Date: 2011.00.0514:07:20-04'0( JOHN F. GAY Branch Manager DCAA Boston Branch Office 12 FOR OFFICIAL USE ONLY Audit Report No. 2171-201IN27000001 AUDIT REPORT DISTRIBUTION Commanding Officer Department of the Navy ATTN: Ms. Robbin Henry, Contract Specialist Naval Facilities Engineering Command Mid -Atlantic 9742 Maryland Avenue Norfolk, VA 23511-3095 Naval Facilities Engineering Command, Atlantic Div DCAA Financial Liaison Advisor ATTN: CODE AQYJDCAA FLA Kim Grimstead 6506 Hampton Building Building A, Code AQX Norfolk, VA 23508-1278 Gale Associates, Inc. 163 Libbey Parkway Weymouth, MA 02189-3101 (Copy Furnished Thru ACO) E-mail Address Robbin.Henry®navy.mil dcaa-fla-navfac-atl@dcaa.mil 13 FOR OFFICIAL USE ONLY