HomeMy WebLinkAbout20130319.tiffRESOLUTION
RE: APPROVE RESTATEMENT OF PURCHASE OF PROFESSIONAL SERVICES
AGREEMENT FOR OIL AND GAS AUDITS AND EVALUATION SERVICES AND
AUTHORIZE CHAIR TO SIGN - MARTINDALE CONSULTANTS, INC.
WHEREAS, the Board of County Commissioners of Weld County, Colorado, pursuant to
Colorado statute and the Weld County Home Rule Charter, is vested with the authority of
administering the affairs of Weld County, Colorado, and
WHEREAS, the Board has been presented with a Restatement of Purchase of
Professional Services Agreement for Oil and Gas Audits and Evaluation Services between the
County of Weld, State of Colorado, by and through the Board of County Commissioners of Weld
County, and Martindale Consultants, Inc., commencing January 21, 2013, and ending
January 20, 2014, with further terms and conditions being as stated in said restated agreement,
and
WHEREAS, after review, the Board deems it advisable to approve said restated
agreement, a copy of which is attached hereto and incorporated herein by reference.
NOW, THEREFORE, BE IT RESOLVED by the Board of County Commissioners of
Weld County, Colorado, that the Restatement of Purchase of Professional Services Agreement
for Oil and Gas Audits and Evaluation Services between the County of Weld, State of Colorado,
by and through the Board of County Commissioners of Weld County, and Martindale
Consultants, Inc., be, and hereby is, approved.
BE IT FURTHER RESOLVED by the Board that the Chair be, and hereby is, authorized
to sign said agreement.
The above and foregoing Resolution was, on motion duly made and seconded, adopted
by the following vote on the 30th day of January, A.D., 2013.
BOARD OF COUNTY COMMISSIONERS
WELD COUNTY, COLORADO
Weld County Clerk to the Board
BY: WA S
Deputy CI
1661
to the Boa
A"'O DAST!#'oR
bunty Attorney
Date of signature:FEB 1 2 2013
f v i! 1b chat
can P. Conway
Mike Freeman
ara Kirkmeyer / /
2013-0319
BC0044
RESTATEMENT OF
PURCHASE OF PROFESSIONAL SERVICES AGREEMENT
OIL AND GAS AUDITS AND EVALUATION SERVICES
This PURCHASE OF PROFESSIONAL SERVICES AGREEMENT ("Agreement") is made this
19TH day of November, 2012, by and between County of Weld, a body politic and corporate of
the State of Colorado, by and through the Board of County Commissioners of the County of
Weld whose address or principal place of business is 1150 "O" Street, Greeley, Colorado
80631, and on behalf of the Weld County Assessor, (hereinafter "BOCC"), and Martindale
Consultants, Inc. an Oklahoma corporation whose principal office is located at 4242 North
Meridian Avenue, Oklahoma City, Oklahoma 73112, registered in the State of Colorado, with a
registered agent, InCorp Services, Inc., located at 36 South 18th Street, Brighton, Colorado
80601, and with Colorado offices located at 4581 Julian, Denver, Colorado 80211, (hereinafter
Contractor").
WHEREAS, on the 3rd day of December, 2012, BOCC entered into an Agreement with
Contractor to provide professional audit services to assist the Weld County Assessor in the
evaluation of appeals of the ad valorem assessments on oil and gas production and on the
personal property used in the production process made by made by oil and gas production
operators, and
WHEREAS, BOCC has now also determined that professional audit services would
assist the Weld County Finance Department in the evaluation of the accuracy of the records of
royalty payments made to Weld County, and
WHEREAS, BOCC has determined that professional audit services would also assist the
Weld County Assessor in the evaluation and assessment of oil and gas production for as
valorem tax purposes, and
WHEREAS, Contractor has the expertise to perform the audits required, has the time
available to timely perform the services, and is willing to perform the services according to the
terms of this Agreement and in accordance with the applicable policies of BOCC and the Weld
County Assessor, and
WHEREAS, BOCC has authority to acquire the services described in this Agreement
pursuant to the provisions of §30-11-101, et seq., C.R.S., as amended, and.
WHEREAS, the Weld County Assessor wishes to and has authority to acquire the
services of a Contractor to assist it in the examination and analysis of the records of the
operator(s) of oil and gas leaseholds as described in this Agreement pursuant to the provisions
§ 39-5-120, § 39-21-109 and § 39-7-105, et seq., C.R.S., as amended, and
WHEREAS, BOCC now wishes to restate the Agreement of December 3, 2012 by
engaging Contractor to provide, in addition to the services set forth in that Agreement, two
2013-0319
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additional areas of professional service, specifically the performance of an audit of the County's
oil and gas royalties and the perform of one or more audits of the records of the operator(s) of
oil and gas leaseholds pursuant to the provisions § 39-5-120, § 39-21-109 and § 39-7-105, et
seq., C.R.S., as amended.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth
hereinafter, BOCC and Contractor agree as follows:
1. Scope of Services: Contractor warrants that the services described below shall
be performed in a manner consistent with the professional standards governing such services
and the provisions of this Agreement. Contractor shall provide three areas of professional
services as set forth below:
a. Contractor affirms that it shall perform in a satisfactory and proper
manner, as determined by the BOCC, the services promised in the Agreement of
December 3, 2012, which are identified in this Agreement as the "Scope of Work
for the Weld County Assessor: Evaluation of Assessment Appeals -2013",
(originally titled "Scope of Work for Weld County Royalty Audits -2013"), which is
attached hereto, incorporated herein by this reference, and made a part hereof
as "Exhibit A". These services relate specifically to professional audit services to
assist the Weld County Assessor in the evaluation of appeals of ad valorem
assessments on oil and gas production and on the personal property used in the
production process made by oil and gas production operators.
b. Contractor further agrees that it shall perform in a satisfactory and proper
manner, as determined by the BOCC, the services identified in the "Scope of
Services for Weld County Ad Valorem Tax Audits -2013", which is attached
hereto, incorporated herein by this reference, and made a part hereof as "Exhibit
B". These services relate specifically to the provision of professional audit
services for the evaluation and assessment of oil and gas production for ad
valorem tax purposes. The responsibilities of BOCC and the Weld County
Assessor in relation to Contractor's services, other than the payment of
compensation, are detailed In "Exhibit B". Contractor agrees that it will perform
the Weld County Ad Valorem Tax Audits, as an agent for the Weld County
Assessor and in strict compliance with the requirements of the statutes of
Colorado. Contractor further warrants that services performed under this
Agreement will be performed in a manner consistent with the professional
standards governing such services and the provisions of this Agreement
c. Contractor further agrees to perform in a satisfactory and proper manner,
as determined by the BOCC, the services identified in the "Scope of Work for
Weld County Royalty Audits -2013", which is attached hereto, incorporated herein
by this reference, and made a part hereof as "Exhibit C". These professional
services shall consist of an audit of the County's oil and gas royalties. The
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responsibilities of the office of the BOCC in relation to Contractor's services,
other than the payment of compensation of the Contractor, are detailed In
Exhibit C.
2. Term of Agreement: Services of the Contractor shall commence on the 21s` day
of January, 2013, and shall be completed by the 20th of January, 2014. This Agreement will
terminate on the date set forth above unless renewed in writing at least thirty (30) days prior to
the date of completion.
3. Compensation/Appropriation: The BOCC's appropriation for the professional
services described in this Agreement is limited solely to the work to be accomplished during the
period from January 21, 2013 through January 20, 2014. BOCC is not obligated to make any
future apportionment or allocation to this Agreement. Any work performed in excess of amounts
appropriated shall be solely at the risk of Contractor. Notwithstanding any other terms of this
Agreement, it is expressly understood and agreed that: (1) any BOCC financial obligation,
whether direct or contingent, for all or any part of the work under this Agreement, shall extend
only to monies duly and lawfully appropriated and budgeted by BOCC and irrevocably pledged
pursuant to the purposes of this Agreement; (2) BOCC does not by this Agreement irrevocably
pledge present cash reserves for payments in this or future fiscal years; (3) this Agreement is
not intended to create a multiple fiscal year direct or indirect financial obligation of BOCC; (4)
the obligation of BOCC for expenditures, if any, arising during subsequent fiscal years in which
this Agreement could be extended and be in effect, shall only extend to utilization of monies
appropriated and budgeted and encumbered for the purpose of this Agreement in the fiscal year
in which obligations arise. Based upon the conditions set forth above, BOCC and Contractor
agree to the following payment terms:
a. County agrees to pay Contractor for services performed as set forth on
Exhibits A, B and C at the rate(s) set forth in each Exhibit. Charges shall be
based on the time actually spent performing the services, including travel time up
to an eight hour day.
b. Contractor shall be reimbursed for actual expenses including hotel,
(based upon average hotel rates in Greeley, Colorado when performing services
at the Greeley offices of Assessor and BOCC), car rental, phone, airfare, and
meals. Contractor shall make all efforts to eliminate the need for travel.
c. Payment to Contractor will be made once per month only upon
presentation of a proper claim by Contractor, itemizing services performed.
Contractor shall submit to BOCC a monthly billing or request for payment that will
be paid in accordance with established procedures of the Weld County Finance
Department. Each billing or request for payment shall specify the total payment
due Contractor for the specific work that is the subject of the request for
payment. Additionally, each billing or request for payment shall specifically state
the job identification, date, time, hours, service performed, expenses, and total
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compensation requested, and shall specifically state whether the services were
performed pursuant to Exhibit A, Exhibit B, or Exhibit C.
d. Payment for services and all related expenses under this Agreement shall
not exceed Two Hundred Thousand and no/100 Dollars ($200,000.00), unless
this Agreement is amended and approved by the BOCC.
e. In the event the BOCC shall require changes in the scope, character, or
complexity of the work to be performed, and said changes cause an increase or
decrease in the time required or the costs to the Contractor for performance, an
equitable adjustment in fees and completion time shall be negotiated between
the parties and this Agreement shall be modified accordingly by a supplemental
Agreement. Any claims by the Contractor for adjustment hereunder must be
made in writing prior to performance of any work covered in the anticipated
supplemental Agreement. Any change in work made without such prior
supplemental Agreement shall be deemed covered in the compensation and time
provisions of this Agreement.
4. Records, Reports, and Information: At such times and in such forms as BOCC
may require, Contractor shall furnish statements, records, reports, data and information
pertaining to matters covered by this Agreement. Contractor shall maintain its records in
accordance with any requirements prescribed by BOCC. Except as otherwise authorized by
BOCC, The Contractor shall maintain such records for a period of seven (7) years after receipt
of final payment under this Agreement. All reports, test results and all other tangible materials
produced in connection with the performance of this Agreement, whether or not such materials
are in completed form, shall at all times be considered the property of the BOCC. Contractor
shall not make use of such material for purposes other than in connection with this Agreement
without prior written approval of BOCC.
5. Audits and Inspections: At any time during normal business hours and as often
as BOCC may deem necessary, Contractor shall make its records with respect to matters
covered by this Agreement available for examination. Contractor shall permit BOCC to audit,
examine, and make excerpts from such records and audit all contracts, invoices, materials,
payrolls, records of personnel, conditions of employment, and other data relating to this
Agreement. BOCC may call for a certified, independent audit to be performed, at Contractor's
expense, by a mutually agreed upon auditor.
6. Independent Contractor:
a. Contractor shall perform its duties hereunder as an independent
contractor and not as an employee of BOCC. Contractor affirms that it
has or will secure at its own expense all personnel and materials required
to perform the services detailed in Exhibit A, Exhibit B, and Exhibit C.
Such personnel shall not be employees of, nor have any contractual
relationship with, BOCC.
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b. Services required hereunder shall be performed by Contractor or under
its supervision, and all personnel engaged in the work shall be fully
qualified and properly licensed or certified, as required by all applicable
local, state and federal laws or regulations to perform such services.
Neither Contractor, nor its personnel, if any, is entitled to Worker's
Compensation benefits or any other benefit of employment with Weld
County, Colorado. Further, Contractor is obligated to pay all federal and
state income tax on any compensation it is paid by BOCC pursuant to this
Agreement.
c. None of the services to be performed by Contractor under this Agreement
shall be subcontracted or otherwise delegated without the prior written
consent of BOCC. Such subcontracted work which is approved shall be
specified in a written agreement between Contractor and its
subcontractor(s), which agreement(s) shall be subject to each provision of
this Agreement.
7. No Assignment: Contractor shall not assign or transfer any rights in this
Agreement without the prior written consent of BOCC.
8. Illegal Aliens — Public Contract for Services:
a. Contractor (entity or sole proprietor) shall execute the certification
attached hereto as Attachment 1, in conformance with the provisions of
§ 8-17.5-102(1) and § 24-76.5-101, C.R.S., as amended.
b. Contractor shall not knowingly employ or contract with an illegal alien to
perform work under this public contract for services; or enter into a
contract with a subcontractor that fails to certify to Contractor that the
subcontractor shall not knowingly employ or contract with an illegal alien
who will perform work under this public contract for services.
c. Contractor shall confirm the employment eligibility of all employees who
are newly hired for employment to perform work under this public contract
for services through participation in either the E -Verify Program or the
Department Program.
d. Contractor shall not use either the E -Verify Program or the Department
Program procedures to undertake pre -employment screening of job
applicants while this public contract for services is being performed.
e. If Contractor obtains actual knowledge that a subcontractor performing
work under this public contract for services knowingly employs or
contracts with an illegal alien, Contractor shall:
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(1) Notify the subcontractor and BOCC within three days that
Contractor has actual knowledge that the subcontractor is
employing or contracting with an illegal alien; and
(2) Terminate the subcontract with the subcontractor if within three
days of receiving the notice required pursuant to subparagraph
(1), above, the subcontractor does not stop employing or
contracting with the illegal alien; except that Contractor shall not
terminate the contract with the subcontractor if during such three
days the subcontractor provides information to establish that the
subcontractor has not knowingly employed or contracted with an
illegal alien.
f. Contractor shall comply with any reasonable request by the Department
of Labor and Employment made in the course of an investigation that the
Department is undertaking pursuant to its authority.
Notwithstanding any other provision of this public contract for services, if
Contractor violates any provision of this paragraph, BOCC may terminate
this public contract for services and Contractor shall be liable for all actual
and consequential damages resulting from that termination.
h. Except where exempted by federal law and except as provided in § 24-
76.5-103(3), C.R.S., as amended, Contractor receiving Weld County
funds under this public contract for services must confirm that any
individual natural person eighteen (18) years of age or older is lawfully
present in the United States pursuant to § 24-76.5-103(4), C.R.S., as
amended, if such individual applies for public benefits provided under this
public contract for services. If Contractor has verified that BOCC has
accomplished such confirmation prior to the effective date of this public
contract for services, Contractor is relieved of responsibility under this
paragraph.
9. Compliance with Laws: Contractor shall comply with all applicable federal, state
and local laws, ordinances, resolutions, codes and regulations in providing the services detailed
in Exhibit A, Exhibit B and Exhibit C.
10. Indemnification: Contractor agrees to hold harmless, indemnify and defend
BOCC, and its officers, employees and agents, acting officially or otherwise, from any and all
claims, demands, damages, and actions of any kind brought by anyone, including attorney's
fees, which may arise out of or result from the negligent or willful misconduct of Contractor or its
subcontractor(s) in the performance of services as set forth in this Agreement and/or the breach
of any condition(s) of this Agreement.
g
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11. Insurance: The following provisions shall apply to Contractor providing services
pursuant to this Agreement. In order to commence work and receive compensation pursuant to
this Agreement, the terms of this paragraph must be satisfied prior to the commencement of
work. Contractor shall procure and maintain, until all of its obligations under this Agreement
have been discharged, including any warranty periods, all insurance required under this
paragraph.
The insurance requirements stated herein are the minimum limits for this Agreement and
in no way limit the indemnity covenants contained in this Agreement. BOCC in no way warrants
that the minimum limits contained herein are sufficient to protect Contractor from liabilities that
might arise out of the performance of the work under this Agreement by Contractor, its agents,
directors, employees, officers, representatives, or subcontractors; and Contractor is free to
purchase additional insurance as it may determine necessary.
Minimum Types and Limits of Insurance: Contractor shall provide coverage with limits of
liability not less than those stated below. An excess liability policy or umbrella liability policy may
be used to meet the minimum liability requirements provided that the coverage is written on a
"following form" basis.
Commercial General Liability - Occurrence Form
The policy shall be endorsed to include the following "Additional Insured" language:
"Weld County, its subsidiary, parent, associated and/or affiliated entities, successors, or
assigns, its elected officials, trustees, employees, agents, and volunteers shall be named as
`Additional Insureds' with respect to liability arising out of the activities performed by, or on
behalf of the Contractor."
Minimum Limits:
General Aggregate
Products/ Completed Operations Aggregate
Each Occurrence Limit
Personal/Advertising Injury
$2,000,000
$2,000,000
$1,000,000
$1,000,000
Automobile Liability (This subparagraph can be waived if Contractor does not use any
type of motor vehicle to perform any service under this Agreement)
Bodily Injury and Property Damage for any owned, hired, and non -owned vehicles used in the
performance of this Contract.
Minimum Limits:
Bodily Injury/Property Damage (Each Accident) $1,000,000
Worker's Compensation and Employers' Liability
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Minimum Limits:
Coverage A (Workers' Compensation)
Coverage B (Employers Liability)
Statutory
$100,000
$100,000
$500,000
Additional Insurance Requirements: The policies shall include, or be endorsed to include, the
following provisions:
On insurance policies where BOCC Is named as an "Additional Insured", BOCC shall be an
Additional Insured to the full limits of liability purchased by Contractor even if those limits of
liability are in excess of those required by the Agreement.
Contractor's insurance coverage shall be primary insurance and non-contributory with respect
to all other available sources.
With respect to Commercial General Liability and Automobile Liability coverage set forth above,
the insurance policy must include contractual liability coverage.
All insurance required by this paragraph shall be issued by companies, authorized to do
business in the state of Colorado and written on forms satisfactory to, approved by, and filed
with the Colorado Division of Insurance within the Colorado Department of Regulatory
Agencies.
Notice of Cancellation: Each insurance policy required by the insurance provisions of this
Contract shall provide the required coverage and shall not be suspended, voided or canceled
except after thirty (30) days prior written notice has been given to BOCC. If cancellation is for
the nonpayment of (a) premium(s), then ten (10) days prior notice may be given to BOCC.
Written notice shall be sent directly to the Office of Contract Administration, at the following
address: Weld County Board of County Commissioners, 1150 "O" Street, Greeley, Colorado
80631
Verification of Coverage: Contractor shall furnish BOCC with Certificates of Insurance (either
an ACCRD form, or an equivalent approved by BOCC).
The certificates for each insurance policy are to be signed by a person authorized by that
insurer to bind coverage on its behalf.
All certificates and endorsements are to be received and approved by BOCC before work
commences. Each insurance policy required by this Agreement must be in effect at or prior to
commencement of work under this Agreement and remain in effect for the duration of the
project and for two (2) years after completion of the project. Failure to maintain the insurance
policies as required by this Agreement, or to provide evidence of renewal, is a material breach
of this Agreement.
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All certificates and any required endorsement shall be sent directly to BOCC at the following
address: Weld County Board of County Commissioners, 1150 "O" Street, Greeley, Colorado
80631 BOCC reserves the right to require complete, certified copies of all insurance policies
required by this Agreement any time.
Approval: Any modification or variation from the insurance requirements in this Agreement
shall only be made by the Weld County Office of Risk Management after consultation with the
Weld County Attorney's office. Modification shall not require a formal contract amendment, but
may be made by administrative action.
12. Document Ownership Works Made for Hire: All of the deliverable items
prepared for BOCC under this Agreement shall belong exclusively to BOCC and shall be
deemed to be "works made for hire" under the copyright laws of the United States. To the extent
any of the deliverable items may not, by operation of law or otherwise, be works made for hire,
the Contractor hereby assigns to BOCC the ownership of the copyright in the deliverable items,
and BOCC shall have the right to obtain and hold in its own name, copyrights, registrations, and
similar protections. Contractor agrees to give BOCC or its designee all assistance reasonably
required to perfect such rights. To the extent that any pre-existing materials are contained in the
deliverable items, Contractor grants to BOCC an irrevocable, non-exclusive, worldwide, royalty -
free license to use, execute, publish, reproduce, display, perform, distribute copies of, and
prepare derivative works based upon such pre-existing materials and derivative works thereof
and to authorize others to do any, some, or all of the foregoing.
13. Termination for Cause: If Contractor or BOCC fails to fulfill its obligations under
this Agreement in a timely and proper manner or violates any of the provisions of this
Agreement, then the non -defaulting party shall thereupon have the right to terminate this
Agreement for cause by giving written notice to the defaulting party of such termination and
specifying the effective date of termination. The defaulting party, however, shall not be relieved
of liability to the non -defaulting party for damages sustained by virtue of any breach of this
Agreement. In the event of default by Contractor, BOCC may withhold payments due under
paragraph 3, above, for the purpose of set-off until such time as the exact amount of damages
due BOCC from Contractor is determined.
14. Termination for Convenience: Either party may terminate this Agreement
without cause at any time. BOCC may terminate this Agreement without cause at any time by
giving at least twenty (20) days written notice to Contractor. If this Agreement is terminated for
the convenience of BOCC, Contractor shall be paid for all services provided to and accepted by
BOCC prior to the date of termination.
15. Conflict of Interest: During the term of this Agreement, Contractor shall not
perform similar services for persons, firms, or entities, including governmental entities, which
have the potential to create a conflict of interest, unless the potential conflict is disclosed to and
approved in writing by BOCC.
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16. Governing Law: The laws of the state of Colorado shall govern the validity,
performance and enforcement of this Agreement. Should either BOCC or Contractor institute
legal action for enforcement of any obligation' contained herein, it is agreed that venue shall be
in Weld County, Colorado.
17. Severability: If any term or condition of this Agreement shall be held to be
invalid, illegal, or unenforceable, this Agreement shall be construed and enforced without such
provision, to the extent that this Agreement is then capable of execution within the original intent
of the parties.
18. Headings: Titles and paragraph divisions are inserted in this Agreement for ease
of reference and do not define, limit, or prescribe the scope or Intent of the provisions of this
Agreement or any part thereof.
19. Authority: Each person signing this Agreement represents and warrants that
he/she is fully authorized to enter into and execute this Agreement and to bind the party
represented to the provisions of this Agreement.
20. Counterparts and Facsimile Signatures: This Agreement may be executed in
counterparts, each of which shall be deemed an original. Facsimile signatures of, or on behalf
of, BOCC or Contractor on this Agreement and any modification hereto shall be effective for all
purposes.
21. Notices: Notices to be provided under this Agreement shall be given in writing
either by hand delivery or by certified return receipt requested United States mall, to the
following:
BOCC's Representative:
Esther Gesick
Deputy Clerk to the Board
1150 "O" Street, P.O. Box 758
Greeley, Colorado 80631
Tel.: 970-336-7215 ext. 4226
Fax:
Email: eqesick(@co.weld.co.us
Contractor:
Martindale Consultants, Inc.
W. Patrick Martindale
President and Owner
4242 N. Meridian Ave.
Oklahoma City, OK 73112
Telephone: (405) 728-3003 Ext. 13
Fax: (405) 728-3893
Email: P.Martindale(a�Marticons.com
Weld County Assessor:
Christopher Woodruff
Weld County Assessor
1400 N. 17th Avenue
Greeley, Colorado 80632
970-353-3845 ext 3650
970-304-6433 ext 3658
cwoodruffco.weld.co.us
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22. Interruptions: Neither party to this Agreement shall be liable to the other for
delays in delivery or failure to deliver or otherwise to perform any obligation under this
Agreement, where such failure is due to any cause beyond its reasonable control, including
but not limited to Acts of God, fires, strikes, war, flood, earthquakes or Governmental
actions.
23. Confidentiality: Contractor is aware that under Colorado law, (§ 39-1-101, § 39-
1-104, § 39-5-120, and § 39-1-116, C.R.S., as amended), the Weld County Assessor is
required to maintain the privacy of the records submitted to it by taxpayers. Contractor
agrees that such taxpayer information shall remain confidential and shall not be disclosed to
any party other than the taxpayer and the Weld County Assessor without the express written
consent of the Weld County Assessor. In addition, no information obtained by Contractor in
the course of the performance of its services under this Agreement shall be disclosed by
Contractor to any third parties for any purpose or reason. All requests for such information
shall be referred to the Weld County Director of Finance and Administration.
24. Acceptance of Product not a Waiver: Upon completion of the work,
Contractor shall submit to BOCC originals of all results, reports, etc., generated during
completion of this work. Acceptance by BOCC of reports and incidental material furnished
under this Agreement shall not in any way relieve Contractor of responsibility for the quality
and accuracy of the work. Acceptance by BOCC of, or payment for, any services performed
under this Agreement shall not be construed as a waiver of any of BOCC's rights under this
Agreement or under the law generally.
25. No Third Party Beneficiary: It is expressly understood and agreed that the
enforcement of the terms and conditions of this Agreement, and all rights of action relating to
such enforcement, shall be strictly reserved to the undersigned parties and nothing in this
Agreement shall give or allow any claim or right of action whatsoever by any other person
not included in this Agreement. It is the express intention of the undersigned parties that
any entity other than the undersigned parties receiving services or benefits under this
Agreement shall be an incidental beneficiary only.
26. Access to Records: BOCC shall have access to Contractor's financial
records as they relate to this Agreement for purposes of audit. Such records shall be
complete and available for audit 90 days after final payment hereunder and shall be retained
and available for audit purposes for at least five years after final payment hereunder.
27. Time of Essence: Time is of the essence in each and all of the provisions of
this Agreement.
28. Non -Exclusive Agreement: This Agreement is nonexclusive and BOCC
may engage or use other contractors or persons to perform services of the same or similar
nature.
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29. Certification: Contractor certifies that Contractor is not an illegal immigrant,
and further, Contractor represents, warrants, and agrees that it has verified that Contractor
does not employ any illegal aliens. If it is discovered that Contractor is an illegal immigrant,
employs illegal aliens or subcontracts with illegal aliens, County can terminate this
Agreement and Contractor may be held liable for damages.
30. Funding Contingency. No portion of this Agreement shall be deemed to
create an obligation on the part of County to expend funds not otherwise appropriated or
budgeted for.
31. Governmental Immunity. Nothing herein shall be interpreted as a waiver of
governmental Immunity to which the BOCC may otherwise be entitled under the provisions
of Section 24-10-101, et seq., C.R.S., as amended.
32. Entire Agreement/Modifications: This Agreement contains the entire
agreement between the parties with respect to the subject matter contained in this
Agreement. This instrument supersedes all prior negotiation, representation, and
understanding or agreements with respect to the subject matter contained in this Agreement.
This Agreement may be changed or supplemented only by a written instrument signed by
both parties.
IN WITNESS WHEREOF, BOCC and Contractor have set their hands and seals.
CONTRACTOR:
ATTEST:
SEAL (if any)
Martindale Cons
(an Okl om
W. Pat ck Martindale - Pr: ident
FEIN: 73-1249823
The foregoing n trument was acknowledged before me this 4 i day of
2013, by I th oz4 /J%/,th, as WGhJeied.2
Martindale Consultants, Inc.
My commission expires on:
LAURA J. MELMAN
Notary Public
Sate of Oklahoma
Commission a 04000005
My Commission Expires Sep 2. 2016
Notarv'Public
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BOARD OF COUNTY
COMMISSIONERSWELD COUNTY,
COLORADO
ATTEST:
Weld Coy i7M Clerk to the Board
BY:
Deputy Clerk o the Boa
William F.
CV-2,
Chair -2
JAN 3 0 2013
13
�r3 O8/ 9
ATTACHMENT A
Public Contracts for Services. C.R.S. §8-17.5-101:
Contractor certifies, warrants, and agrees that it does not knowingly employ or contract
with an illegal alien who will perform work under this contract and will confirm the
employment eligibility of all employees who are newly hired for employment in the
United States to perform work under this Agreement, through participation in the E -
Verify program of the Department program established pursuant to C.R.S. §8-17.5-
102(5)(c). Contractor shall not knowingly employ or contract with an illegal alien to
perform work under this Agreement or enter into a contract with a subcontractor that
fails to certify with Contractor that the subcontractor shall not knowingly employ or
contract with an illegal alien to perform work under this Agreement. Contractor (a) shall
not use E -Verify Program or Department program procedures to undertake pre-
employment screening or job applicants while this Agreement is being performed, (b)
shall notify the subcontractor and Weld County within three (3) days that Contractor
has actual knowledge that a subcontractor is employing or contracting with an illegal
alien and (c) shall terminate the subcontract if a subcontractor dues not stop employing
or contracting with the illegal alien within three (3) days of receiving notice, and (d) shall
comply with reasonable requests made in the course of an investigation, undertaken
pursuant to C.R.S. §8-17.5-102(5), by the Colorado Department of Labor and
Employment. If Contractor participates in the Department program, Contractor shall
deliver to Weld County, a written notarized affirmation that V has examined the legal
work status of such employee, and shall comply with all of the other requirements of the
Department program. If Contractor fails to comply with any requirement of this provision
or of C.R.S. §8-17.5-101 et seq., Weld County, may terminate this Agreement for
breach, and if so terminated, Contractor shall be liable for damages.
ATTEST:
SEAL (if any)
CONTR
artindale Cons, ants, Inc.
(an Oklahoma Corporation)
By: \ /, Re TicicK MA-RTi1Vt 4LE, PRFS'DENT
Name and Title
FEIN: 73- /2"/78°13
The foregoing instrument was cknowledged before me this' day of
2013, by `✓ P,[}I"i!.'{f /*<ii7//thy , as �r4leni
Martindale Consultants, Inc.
My commission expires on:
tar's] I
I A
January 17, 2013
RE: Scope of Work for Weld County
Abatement Filings Consulting and Review
\1 in n jUDle [HI isultaI its. if u .
1) Initial Projects:
A. Encana Abatement Filing Consulting and Discovery
B. EOG Abatement Filing Consulting and Discovery
2) Services for Each Project:
A. General consulting for the Assessor's office on an "as needed" basis.
B. Review Abatement Filing and aide the Assessor's office in developing the discovery
request for each Abatement Filing.
C. Review filings and provided support for compliance with Chapter 6 of the Assessors
Reference Library.
3) Manpower Requirements:
Manpower Requirements will be consistent with the manpower requirements for the Ad Valorem
audits listed in Exhibit B.
4) Rates:
Rates for the beginning of this engagement through December 2013 shall be:
Personnel
Project Manager
Lead Auditor
Assisting Auditors
Todd Attalla
Pat Martindale
Administrative Assistance
Rate per Hour
$ 125.00 - 150.00
100.00 - 110.00
80.00 - 100.00
150.00
200.00
50.00 - 80.00
Litigation Rates Rate per Hour
W. Patrick Martindale $ 300.00
Todd Attalla 250.00
Corporate Office • 4242 N. Meridian Ave. • Oklahoma City, OK 7311 2
Phone: (405) 728-3003 • Fax: (405) 728-3893 • www.marticons.com
51 General:
We want to meet the Counties objectives while also staying within our firm's capacity to
maintain quality control on each individual project as they arise.
We look forward to working with you and will address any questions and concerns you may
have as we progress.
Regards,
Todd Attalla
Martindale Consultants, Inc.
Phone (405) 728-3003 Ext. 12.
Corporate Office • 4242 N. Meridian Ave. • Oklahoma City, OK 73112
Phone: (405) 728-3003 • Fax: (405) 728-3893 • www.marticons.com
U(1111511-
1 e
January 17, 2013
RE: Scope of Work for Weld County
Ad Valorem Tax Audits - 2013
Mur tlndult, [or i5ultdnts. Inc
Projects (May not be completed in the year the project is initiated):
1. 2013 Ad Valorem Tax Filing Audits for Tax Years 2009 and 2010 (Current Well Count)
a. Noble Energy, Inc. (7,172)
b. Petroleum Development Corporation (1,677)
c. Encana Oil & Gas (USA), Inc. (936)
2. 2014 Ad Valorem Tax Filing Audits for Tax Years 2009 and 2010 (Current Well Count)
a. Continuation of 2012 Audits
b. Anadarko Petroleum Corporation (5,245)
c. K P Kauffman Company, Inc. (780)
d. Merit Energy (680). [will require a conflict of interest waiver, as MartiCons
provides audit services for Merit Energy]
3. 2015 Ad Valorem Tax Filing Audits for Additional Taxpayers and Tax Years Contingent
on Prior Audit Results
Basic Audit Program Developed for Ad Valorem Audits:
Each audit may vary due to the documentation available from each Operator and the situations
encountered during the audit. Weld County personnel can be involved as much or as little as
possible with all audit program steps; we will develop our approach and coordination in such a
way as to provide as much information and training as possible for Weld County personnel.
1. Obtain the Oil and Gas Reports from the Weld County Tax Office to document the Declared
Volumes and Values by Operator.
2. Request from the Taxpayer, supporting schedules/spreadsheets from which the annual
amounts by well were assimilated for their tax return, identifying the following monthly
amounts for each well:
a. Gross volume by product.
b. Gross value by product.
c. Each separate deduction.
d. Nature, source, and amount of exempt royalties deducted.
Corporate Office • 4242 N. Meridian Ave. • Oklahoma City, OK 73112
Phone: (405) 728-3003 • Fax: (405) 728-3893 • www.marticons.com
Basic Audit Program Developed for Ad Valorem Audits (continued): Page 2
e. Schematic showing all wells, gathering systems, and transportation pipelines owned
and/or used to deliver sales; all processing plants and/or treating plants through which
production was processed during the audit time period.
f. Electronic listing of revenue data (RADE) for the audit time period.
g. Electronic listing of line item detail from which the wellsite processing deductions
were derived.
3. Reconcile the data received from the Taxpayer to the tax return.
4. Analyze the revenue data from 1 through 3 to identify anomalies, trends, and materiality;
select appropriate test months based on exposures identified in the analysis.
5. Analyze the expense data from items 1 through 3 to determine audit strategy to effectively
and efficiently review both related party and unrelated party deductions from revenue.
6. Based on the analysis in item 4, identify and request from the Taxpayer the underlying
documents (only for the test months chosen) necessary to provide an audited, documented
understanding of volumes produced, gathered, treated, transported and sold; first third party
sales value and ultimate tax value paid; deductions taken. These documents would include,
but not be limited to:
a. Volume integration statements and/or EFT volume statements for all measurement
points: wellhead, gathering system outlets, gas plant inlets/outlets, transportation
system inlet/outlet, and sales delivery meters.
b. LACT readings or other oil measurement documentation.
c. Third party invoices or internal journal entries for all costs of gathering and
transportation and/or any other deduction taken on the tax return.
d. Gas plant statements for each well; if plant is owned by the Taxpayer, the gas plant
volume balance worksheets for the month.
e. Gas processing contracts in place for each test month (could be one or more); if plant
is owned by the Taxpayer, contracts with all producers delivering through the plant.
f. Third party invoices and sales delivery volume statements for all third party sales
sourced in whole or in part from Weld County wells.
7. Review deduction documentation provided and submit a request for items necessary to
support the declared deductions.
Corporate Office • 4242 N. Meridian Ave. • Oklahoma City, OK 73112
Phone: (405) 728-3003 • Fax: (405) 728-3893 • www.marticons.com
Basic Audit Program Developed for Ad Valorem Audits (continued): Page 3
8. Request from the Taxpayer any additional information necessary to verify all potential
adjustments to the tax payment. Meet with the appropriate Taxpayer personnel to discuss
potential underpayments, resolve questions regarding accounting for volumes and/or values,
obtain additional documentation to eliminate or confirm adjustments, and otherwise obtain
consensus (if possible) to any Taxpayer underpayments identified during the field work.
9. Request and obtain from Taxpayer any documents necessary to quantify underpayments
(even those disputed by the Taxpayer) identified during the audit for all remaining non -test
months of the audit period. Also, request and obtain documents necessary to quantify
underpayments due to declaring deductions that are not in compliance with Chapter 6 of the
Assessors Reference Library.
10. Quantify all underpayments, identified separately by type of exception, for each well for each
month of the reporting period. Summarize total underpayment by Taxpayer for each type of
exception for the audit period or applicable Tax Year.
11. Assimilate all findings into an audit report, including all necessary supporting schedules.
12. Provide copies of supporting detail (schedules and documents) for all adjustments necessary
for the Taxpayer to understand and agree with the computation of the underpayment.
13. Negotiate and resolve all disputed items after Special Notice of Valuation is issued by Weld
County and ultimately aide in creating the Special Notice of Determination for which the
new revised tax will be based upon. (This step is based on procedures used in Garfield
County)
Estimated Man Weeks per Taxpayer:
For each Taxpayer there are typically 4 phases of the audit. Each phase can vary significantly
based on the number of Tax Years included, the number of wells operated by each Taxpayer, and
the familiarity of the Operator with the audit process. The following is an estimated range of the
manpower requirements for each phase. The estimated man weeks may not be a single block of
time but more an accumulated amount of manpower necessary to complete each phase,
especially for the prep phase. For instance, once an initial request is made to the Taxpayer, there
will be a window of time that it takes for the Taxpayer to return the requested data. The
following is an estimate of man weeks per phase (by Tax Year) broken down by three categories
of Taxpayers.
Corporate Office • 4242 N. Meridian Ave. • Oklahoma City, OK 73112
Phone: (405) 728-3003 • Fax: (405) 728-3893 • www.marticons.com
Estimated Man Weeks per Taxpayer (continued): Page 4
A. Taxpayer Category 600 to 1,000 wells (Merit, Kauffman, Encana)
1. Preparatory Manpower: 1 to 3 man weeks
2. Fieldwork Manpower: 6 to 9 man weeks
3. Report: 1 to 2 man weeks
4. Resolution: 1/2 to 1 week
B. Taxpayer Category 1,600 to 1,700 wells (PDC)
1. Preparatory Manpower: 2 to 4 man weeks
2. Fieldwork Manpower: 9 to 12 man weeks
3. Report: 1 to 2 man weeks
4. Resolution: 1/2 to 1 week
C. Taxpayer Category 5,000 to 7.500 wells (Noble and Anadarko)
1. Preparatory Manpower: 3 to 6 man weeks (Very dependent on the Taxpayer's record
keeping practices)
2. Fieldwork Manpower: 12 to 15 man weeks
3. Report: Ito 2 man weeks
4. Resolution: 1/2 to 2 week
The above manpower estimates are based on a single Tax Year. The 2013 Scope of Work
consists of review of two Tax Years for a single Taxpayer in each category.
Rates:
Rates for the beginning of this engagement through December 2013 shall be:
Personnel
Project Manager
Lead Auditor
Assisting Auditors
Todd Attalla
Pat Martindale
Administrative Assistance
Litigation Rates
W. Patrick Martindale
Todd Attalla
Rate per Hour
$ 125.00 - 150.00
100.00 - 110.00
80.00 - 100.00
150.00
200.00
50.00 - 80.00
Rate per Hour
$ 300.00
250.00
Corporate Office • 4242 N. Meridian Ave. • Oklahoma City, OK 73112
Phone: (405) 728-3003 • Fax: (405) 728-3893 • www.marticons.com
General: Page 5
Starting on Tax Year 2009 will allow us more flexibility in selecting Taxpayers since the 2009
Tax Year audit rights do not expire until 2015. Accordingly, we have selected two Tax Year
audits for three major Taxpayers for 2013 and will continue with the other three Taxpayers in
2014. Based on past experience, the first round of audits present scheduling challenges for both
the Taxpayers and MartiCons due to the size of the projects and Taxpayers unfamiliarity with the
type of documentation that is needed to conduct the audit. Not having to manage six large
Taxpayers in the first calendar year somewhat mitigates these difficulties.
It can be very difficult to estimate the manpower requirements for some of the Taxpayers
because it is contingent on the Taxpayers record retention policy for the earlier years and
whether the data is available electronically or only in hardcopy. We should be able to achieve
some economies of scale by including more than one Tax Year per Operator, but as previously
mentioned, the first round of audits can be very challenging. Ultimately, we want to meet the
Counties objectives while also staying within our firm's capacity to maintain quality control on
each individual project.
We look forward to working with you and can address any questions you would like to discuss
during our November 6th meeting.
Thank you,
Todd Attalla
Martindale Consultants, Inc.
Phone (405) 728-3003 Ext. 12.
Corporate Office • 4242 N. Meridian Ave. • Oklahoma City, OK 73112
Phone: (405) 728-3003 • Fax: (405) 728-3893 • www.marticons.com
EXHIBIT
tic
January 17, 2013
RE: Scope of Work for Weld County
Royalty Audits - 2013
Initial Projects:
\lctrtindaic CLJF ISUItL]nC5. if f .
1. Weld County (Weld) Royalty Audits (If possible, conduct in conjunction of revenue
component of Ad Valorem Audits) During the course of work, an appropriate allocation
will be made between audit costs for ad valorem tax audits and royalty audits and extra
work associated strictly with royalty audits will be identified. Based on preliminary
review of information provided, the three Operator's below are the possible audit
candidates
a. Noble Energy, Inc.
b. Great Western Oil and Gas Company
c. Kerr-McGee Oil & Gas
2. Provide support and expertise directed to county royalty processes and assistance with
future lease language.
Suggested Audit Strategy for Weld County Royalty Interests:
1. Phase I:
Further analyze Weld County check remittances and electronic data compiled by the
County. Initial review of the payment remittances from Noble, Great Western, and Kerr-
McGee, indicates Weld has royalty interest in a large number of wells but at a very small
decimal which prohibits the ability to efficiently and economically audit the wells.
However, it is also noted that Weld has a significant royalty interest (10% or greater) in
wells from each one of the three major royalty remitters. Therefore, we recommend
further analysis of Weld's royalty payment database in conjunction with the payment
remittances to refine a potential audit population for each Operator.
2. Phase II:
Depending on the results of Phase I, request Revenue Audit Data Exchange (RADE)
detail from the three major Operators to further analyze or possibly conduct a desk audit
for compliance with the applicable Leases to determine if significant exposures exist to
merit a detailed audit of sample wells selected from each Operator.
Corporate Office • 4242 N. Meridian Ave. • Oklahoma City, OK 73112
Phone: (405) 728-3003 • Fax: (405) 728-3893 • wwwv.marticons.com
Suggested Audit Strategy for Weld County Royalty Interests (continued): Page 2
3. Phase III:
Once we determine audit candidates (if any) from Phases I and II, further analyze the
RADE provided by the three major Operators and notify selected Operators of the
documentation needed to conduct an audit of the selected wells.
At this point, request from the Operator the underlying documents (only for the test
months chosen) necessary to provide an audited, documented understanding of volumes
produced, gathered, treated, transported and sold; first third party sales value and
deductions taken. These documents include, but are not limited to:
a. Volume integration statements and/or EFT volume statements for all measurement
points: wellhead, gathering system outlets, gas plant inlets/outlets, transportation
system inlet/outlet, and sales delivery meters.
b. LACT readings or other oil measurement documentation.
c. Third party invoices or internal journal entries for all costs of gathering and
transportation and/or any other deduction taken.
d. Gas plant statements for each well; if plant is owned by the Operator, the gas plant
volume balance worksheets for the month.
e. Gas processing contracts in place for each test month (could be one or more); if plant
is owned by the Operator, contracts with all producers delivering through the plant.
f Third party invoices and sales delivery volume statements for all third party sales
sourced in whole or in part from Weld county wells.
g. Schematic showing all wells, gathering systems, and transportation pipelines owned
and/or used to deliver sales; all processing plants and/or treating plants through which
production was processed during the audit time period.
Then conduct the royalty audit with similar audit steps that are used in the Ad Valorem revenue /
royalty verification and contained in the Ad Valorem Audit Proposal.
Estimated Manpower for Each Phase and Audit:
Similar to the Ad Valorem audits, for each Operator there are typically 4 phases of the audit. For
the royalty audits, the Operators are much more familiar with the process and protocols.
Accordingly, based on the smaller number of wells and the Operator's familiarity, these audits
will require less manpower than the Ad Valorem audits. Following is an estimated range of the
manpower requirements for each Phase and for each audit if conducted.
Corporate Office • 4242 N. Meridian Ave. • Oklahoma City, OK 73112
Phone: (405) 728-3003 • Fax: (405) 728-3893 • www.marticons.com
Estimated Manpower for Each Phase and Audit (continued): Page 3
1. Phase I:
The initial analysis for each of the three major Operators, including reviewing the lease
language applicable to the wells with the largest royalty interest: Estimated to take one to
two weeks per Operator by a Manager or Lead Auditor.
2. Phase II:
Reconcile the RADE data to Weld's check remittances (to ensure data integrity) and
analyze trends and materiality: Estimated three days to two weeks per Operator by a
Manager or Lead Auditor.
3. Phase II:
a. Preparatory Manpower: 2 days to 1 man week.
b. Fieldwork Manpower: 4 to 9 man weeks (large variance due to uncertainty of audit
scope / number of wells).
c. Report: 1 to 2 man weeks.
d. Resolution: 1/2 to I week.
Rates:
Rates for the beginning of this engagement through December 2013 shall be:
Personnel Rate per Hour
Project Manager
Lead Auditor
Assisting Auditors
Todd Attalla
Pat Martindale
Administrative Assistance
$ 125.00 — 150.00
100.00 — 110.00
80.00 — 100.00
150.00
200.00
50.00 — 80.00
Litigation Rates Rate per Hour
W. Patrick Martindale $ 300.00
Todd Attalla 250.00
Corporate Office • 4242 N. Meridian Ave- • Oklahoma City, OK 73112
Phone: (405) 728-3003 • Fax: (405) 728-3893 • www.marticons.com
General:
Page 4
We look forward to working with you and if you have any questions or would like to discuss,
please call me at the number below or we can further discuss at our November 6th meeting.
Thank you,
Todd Attalla
Martindale Consultants, Inc.
Phone (405) 728-3003 Ext. 12.
Corporate Office • 4242 N. Meridian Ave. • Oklahoma City, OK 73112
Phone: (405) 728-3003 • Fax: (405) 728-3893 • www.marticons.com
MEMORANDUM
DATE: January 18, 2013
TO: Board of County Commissioners — Pass -Around
FR: Stephanie Arries, Assistant Weld County Attorney
RE: Restatement of the Agreement with Martindale
Consultants, Inc.
Martindale Consultants, Inc., entered into an Agreement with Weld County to provide
audit services concerning the Abatement appeal filed by Encana last year. They are
currently working with the Assessor's office in the capacity of a consultant.
The plan at the time was that this company would also conduct audits of the royalties
received by the County and would conduct audits of the production reports filed with the
Weld County Assessor by various producers in the County.
The attached Agreement represents the Restatement of the 2012 Agreement which
incorporates all three areas of service which Martindale Consultants, Inc., will be
providing to the County. The overall amount of money pledged by the County has not
changed. The services, as reflected in the Exhibits (Scopes of Word) may be provided
over more than just the current year, but the County retains the ability to either continue
with their services by entering into a new agreement or simply letting this Agreement
terminate.
This Agreement was discussed in some depth with Don Warden in a Work Session in the
fall of 2012, and at that time the Board was made aware that the County would contract
on behalf of the Assessor for the services relating to the appeal, but would hold off on
contracting for the rest of the services until after the first of the year.
The question at this time is whether the Board would like a Work Session to further discuss this
matter. I do not necessarily recommend a work session, as the matter was previously approved
Don Warden, Chris Woodruff and Brenda Dones have looked at the Agreement and the Scopes
of Work and have approved the package.I do recommend approval of the Agreement. If the
Board approves this Agreement, I will forward it to Martindale consultants, Inc for signing and
then bring it to the Board for final approval.
Approve Request
BOCC Agenda Work Session
Bill Garcia
Doug Rademacher
Sean Conway
Mike Freeman
Barbara Kirkmeyer
Pass -Around Memorandum Page 1
a D(3 - 03 19
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