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HomeMy WebLinkAbout2003-05-20; City Council; 17173; Construction of Rancho Santa Fe Road Phase 1CITY OF CARLSBAD -AGENDA BILL i~# 17,173 IIITG. 5/20/03 IEPT. ENG TITLE: AGREEMENT FOR ENVIRONMENTAL DEPT.HD. - MONITORING SERVICES WITH DUDEK &ASSOCIATES PHASE 1, PROJECT NO. 31 90 FOR CONSTRUCTION OF RANCHO SANTA FE ROAD, CITY ATTY.~& CITY MGR= RECOMMENDED ACTION: Adopt Resolution No. 2003-127 approving an agreement for environmental monitoring services with Dudek & Associates for Rancho Santa Fe Road North, Phase 1, Project No. 31 90. ITEM EXPLANATION: The Rancho Santa Fe Road project consists of the widening and realignment of approximately 2.2 miles of Rancho Santa Fe Road from La Costa Avenue to Melrose Drive. The project will be constructed in two phases: Phase 1, from La Costa Avenue to San Elijo Road; and Phase 2, from San Elijo Road to Melrose Drive. Benefits of the project include reduced congestion, improved traffic flow, and increased safety for travelers on the road. Additionally, this project will improve a vital link in the North County region’s roadway network. On November 19, 2002, City Council approved Resolution No. 2002-343 awarding a construction contract to Erreca’dHanson SJH Joint Venture, for the Rancho Santa Fe Road North, Phase 1 Realignment and Widening, Project No. 3190. Construction of Phase 2 is anticipated to start in late 2003. The City of Carlsbad is required to have a certified biologist at the construction site per the Rancho Santa Fe Road construction permits from the California Department of Fish and Game, the U.S. Wildlife Service and the Army Corps of Engineers. Dudek & Associates prepared environmental documents for Rancho Santa Fe Road. Dudek & Associates was retained to provide biological monitoring of the clearing operations for Phase 1 of Rancho Santa Fe Road and for that portion of Phase 1 constructed by Morrow Development under a reimbursement agreement with the City. Staff desires to have Dudek & Associates continue the environmental monitoring services for the remaining portion of the Phase 1 construction. Per Carlsbad Municipal Code 3.28.070, the Purchasing Officer has waived the formal bidding requirements for these environmental monitoring services due to Dudek’s expertise and knowledge of the project. FISCAL IMPACT: Budget The cost of the Rancho Santa Fe Road Phase 1 and 2 projects are summarized in the following table. Costs shown for all Phase 1 tasks are based on actual costs and bids received and include design costs for Phase 2, which were incurred concurrently with Phase 1. All costs for Phase 2, except the remaining design costs, are estimated. The costs associated with the Dudek & Associates contract under consideration is $1 15,000 and is included in the Environmental Mitigation & Monitoring category for Phase 1, as shown in the table above. These funds have already been appropriated. I Page 2 of Agenda Bill No. I7r173 Funding Phase 1 FederallState Funding Source FHWA - RSTP, HP-21 IDA TOTAL The Rancho Santa Road Phase 1 and 2 projects will be funded with a combination of Community Facilities District No. 1 (CFD #I), Planned Community Facilities District No. 2 (CFD #2), Public Facilities Fee (PFF), Federal and State grants, and reimbursements from other agencies and developers. Funding sources are summarized below: Amount $4,250,000 $273,866 $4,523,866 CFD #1, CFD #2 & PFF Community Facilities District special taxes and fees will fund most of the costs for Phase 1 and 2 of the project. Sufficient amounts have been collected for the existing appropriations. Developer fees will fund the remaining costs for Phase 2 construction in the future. State and Federal Grants State and federal grants have been authorized by the appropriate agencies for Phase 1 as shown above. Caltrans has issued construction authorization on behalf of the Federal Highway Administration (FHWA) for reimbursement of eligible costs from Regional Surface Transportation Program (RSTP) and High Priority (HP-21) funds. The RSTP and HP-21 grants require matching funds, which will be paid from CFD #2. Transportation Development Act (TDA) funds have been authorized by SANDAG. The following is a summary of the Federal and State funding sources for Phase 1 construction: Other Agencies Several of the utilities that will be constructed with this project will be installed through reimbursement agreements with various agencies and property owners. Reimbursement agreements for Phase 1 construction were brought forth to the City Council for approval prior to awarding the construction contract. Reimbursement agreements with various agencies for Phase 2 will be brought forth to City Council for approval prior to, or concurrent with, the award of the Phase 2 construction contract. These agencies and property owners will contribute approximately $2.9 million for Phase 1, and $3.5 million for Phase 2, as identified in the above table under Funding as “Other Agencies”. Page 3 of Agenda Bill No. 17r173 ENVl RON MENTAL: The City Council at their meeting on June 2, 1992 passed Resolution No. 92-152 certifying EIR No. 91-1 for both Phase 1 and Phase 2 of the Rancho Santa Fe Road project. The City Council at their meeting on April 25, 2000 passed Resolution No. 2000-128 approving Addendum No. 2 to the final EIR No. 91-1 for Rancho Santa Fe Road. This EIR covers the realignment and widening of Rancho Santa Fe Road from La Costa Avenue to Melrose Drive. EXHIBITS: 1. Resolution No. 2003-127 approving the agreement for environmental monitoring services with Dudek & Associates for construction of Rancho Santa Fe Road, Phase 1, Project No. 3190. 2. Agreement for Environmental Monitoring Services with Dudek & Associates for Construction of Rancho Santa Fe Road, Phase 1, Project No. 3190. DEPARTMENT CONTACT: Carrie Loya-Smalley, (760) 602-2746, cloya@ci.carlsbad.com 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 RESOLUTION NO. 2003-127 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, APPROVING AN AGREEMENT FOR ENVIRONMENTAL MONITORING SERVICES WITH DUDEK & ASSOCIATES FOR CONSTRUCTION OF RANCHO SANTA FE ROAD, PHASE 1, PROJECT NO. 3190. WHEREAS, the City Council of the City of Carlsbad, California, consider it necessary and n the public interest to approve the agreement for environmental monitoring services with 3udek &Associates for construction of Rancho Santa Fe Road, Phase 1 , Project No. 31 90; and WHEREAS, the City of Carlsbad is required to provide a certified biologist at the Rancho ;anta Fe Road construction site per the California Department of Fish and Game, the U.S. Nildlife Service and the Army Corps of Engineers; and WHEREAS, the contractor, Dudek & Associates, possesses the necessary skills and lualifications to provide the services described above; and WHEREAS, the Purchasing Officer, or her delegate, has waived the competitive bidding ,equirements for the agreement as allowed by Carlsbad Municipal Code Section 3.28.070 based in Dudek & Associates unique experience on this Project; and WHEREAS, the agreement for environmental monitoring services with Dudek & JIssociates for construction of Rancho Santa Fe Road, Phase 1, Project No. 3190 has been Irepared and submitted hereto. ti ti Il It It It It ti It 1 i a w 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California, as follows: I. 2. That the agreement for environmental monitoring services Associates for construction of Rancho Santa Fe Road, Phase 1, Project No. approved and the Mayor is authorized and directed to execute said agreement. That the above recitations are true and correct. with Dudek & 3190 is hereby PASSED, APPROVED AND ADOPTED at a regular meeting of the Carlsdad City Council held on the 20th day of MAY , 2003 by the following vote, to wit: AYES: Council Members Lewis, Hall, Packard nd Kulchin 4TTEST Page 2 of 2 of Resolution No. 2003-127 (SEAL) PWENG342 PO# &?a+ AGREEMENT FOR ENVIRONMENTAL MONITORING SERVICES WITH DUDEK & ASSOCIATES FOR CONSTRUCTION OF RANCHO SANTA FE ROAD, PHASE 1, PROJECT NO. 3190 is made and entered into as of the 2 h/b day of by and between the CITY OF CARLSBAD, a municipal & Associates, a California corporation, ("Contractor"). RECITALS A. City requires the professional services of a qualified biologist that is experienced in identification of the California Gnatcatcher and its habitat and working around construction activities. B. Contractor has the necessary experience in providing professional services and advice related to the California Gnatcatcher, its habitat, and working around construction activities. C. Selection of Contractor is expected to achieve the desired results in an expedited fashion. D. Contractor has submitted a proposal to City and has affirmed its willingness and ability to perform such work. NOW, THEREFORE, in consideration of these recitals and the mutual covenants contained herein, City and Contractor agree as follows: 1. SCOPE OF WORK City retains Contractor to perform, and Contractor agrees to render, those services (the "Services") that are defined in attached Exhibit "A", which is incorporated by this reference in accordance with this Agreement's terms and conditions. 2. STANDARD OF PERFORMANCE While performing the Services, Contractor will exercise the reasonable professional care and skill customarily exercised by reputable members of Contractor's profession practicing in the Metropolitan Southern California Area, and will use reasonable diligence and best judgment while exercising its professional skill and expertise. 3. TERM The term of this Agreement will be effective for a period of three years from the date first above written. The City Manager may amend the Agreement to extend it for two (2) additional one (1) year periods or parts thereof in an amount not to exceed one hundred thousand dollars ($100,000) per Agreement year. Extensions will be based upon a satisfactory review of Contractor's performance, City needs, and appropriation of funds by the City Council. The parties will prepare a written amendment indicating the effective date and length of the extended Agreement. City Attorney Approved DBE Version #04.16.02 1 4. Time is of the essence for each and every provision of this Agreement. TIME IS OF THE ESSENCE 5. COMPENSATION The total fee payable for the Services to be performed during the initial Agreement term will be one hundred fifteen thousand dollars ($1 15,000). No other compensation for the Services will be allowed except for items covered by subsequent amendments to this Agreement. The City reserves the right to withhold a ten percent (10%) retention until City has accepted the work and/or Services specified in Exhibit "A". Incremental payments, if applicable, should be made as outlined in attached Exhibit "A". 6. STATUS OF CONTRACTOR Contractor will perform the Services in Contractor's own way as an independent contractor and in pursuit of Contractor's independent calling, and not as an employee of City. Contractor will be under control of City only as to the result to be accomplished, but will consult with City as necessary. The persons used by Contractor to provide services under this Agreement will not be considered employees of City for any purposes. The payment made to Contractor pursuant to the Agreement will be the full and complete compensation to which Contractor is entitled. City will not make any federal or state tax withholdings on behalf of Contractor or its agents, employees or subcontractors. City will not be required to pay any workers' compensation insurance or unemployment contributions on behalf of Contractor or its employees or subcontractors. Contractor agrees to indemnify City within thirty (30) days for any tax, retirement contribution, social security, overtime payment, unemployment payment or workers' compensation payment which City may be required to make on behalf of Contractor or any agent, employee, or subcontractor of Contractor for work done under this Agreement. At the City's election, City may deduct the indemnification amount from any balance owing to Contractor. 7. SUBCONTRACTING Contractor will not subcontract any portion of the Services without prior written approval of City. If Contractor subcontracts any of the Services, Contractor will be fully responsible to City for the acts and omissions of Contractor's subcontractor and of the persons either directly or indirectly employed by the subcontractor, as Contractor is for the acts and omissions of persons directly employed by Contractor. Nothing contained in this Agreement will create any contractual relationship between any subcontractor of Contractor and City. Contractor will be responsible for payment of subcontractors. Contractor will bind every subcontractor and every subcontractor of a subcontractor by the terms of this Agreement applicable to Contractor's work unless specifically noted to the contrary in the subcontract and approved in writing by City. 8. OTHER CONTRACTORS The City reserves the right to employ other Contractors in connection with the Services. City Attorney Approved DBE Version #04.16.02 2 9. INDEMNIFICATION Contractor agrees to indemnify and hold harmless the City and its officers, officials, employees and volunteers from and against all claims, damages, losses and expenses including attorneys fees arising out of the performance of the work described herein caused in whole or in part by any willful misconduct or negligent act or omission of the Contractor, any subcontractor, anyone directly or indirectly employed by any of them or anyone for whose acts any of them may be liable. The parties expressly agree that any payment, attorney's fee, costs or expense City incurs or makes to or on behalf of an injured employee under the City's self-administered workers' compensation is included as a loss, expense or cost for the purposes of this section, and that this section will survive the expiration or early termination of this Agreement. 10. INSURANCE Contractor will obtain and maintain for the duration of the Agreement and any and all amendments, insurance against claims for injuries to persons or damage to property which may arise out of or in connection with performance of the services by Contractor or Contractor's agents, representatives, employees or subcontractors. The insurance will be obtained from an insurance carrier admitted and authorized to do business in the State of California. The insurance carrier is required to have a current Best's Key Rating of not less than "A-:VI'. 10.1 Coveraaes and Limits. Contractor will maintain the types of coverages and minimum limits indicated below, unless City Attorney or City Manager approves a lower amount. These minimum amounts of coverage will not constitute any limitations or cap on Contractor's indemnification obligations under this Agreement. City, its officers, agents and employees make no representation that the limits of the insurance specified to be carried by Contractor pursuant to this Agreement are adequate to protect Contractor. If Contractor believes that any required insurance coverage is inadequate, Contractor will obtain such additional insurance coverage, as Contractor deems adequate, at Contractor's sole expense. 10.1.1 Commercial General Liabilitv Insurance. $1,000,000 combined single-limit per occurrence for bodily injury, personal injury and property damage. If the submitted policies contain aggregate limits, general aggregate limits will apply separately to the work under this Agreement or the general aggregate will be twice the required per occurrence limit. 10.1.2 Automobile Liability (if the use of an automobile is involved for Contractor's work for City). $1,000,000 combined single-limit per accident for bodily injury and property damage. City Attorney Approved DBE Version #04.16.02 3 10.1.3 Workers' Compensation and Emplover's Liability. Workers' Compensation limits as required by the California Labor Code and Employer's Liability limits of $1,000,000 per accident for bodily injury. Workers' Compensation and Employer's Liability insurance will not be required if Contractor has no employees and provides, to City's satisfaction, a declaration stating this. 10.1.4 Professional Liabilitv. Errors and omissions liability appropriate to Contractor's profession with limits of not less than $1,000,000 per claim. Coverage must be maintained for a period of five years following the date of completion of the work. 10.2. Additional Provisions. Contractor will ensure that the policies of insurance required under this Agreement contain, or are endorsed to contain, the following provisions: 1 0.2.1 The City will be named as an additional insured on General Liability. 10.2.2 Contractor will obtain occurrence coverage, excluding Professional Liability, which will be written as claims-made coverage. 10.2.3 This insurance will be in force during the life of the Agreement and any extensions of it and will not be canceled without thirty (30) days prior written notice to City sent by certified mail pursuant to the Notice provisions of this Agreement. 10.3 Providinq Certificates of lnsurance and Endorsements. Prior to City's execution of this Agreement, Contractor will furnish certificates of insurance and endorsements to. City. 10.4 Failure to Maintain Coveraqe. If Contractor fails to maintain any of these insurance coverages, then City will have the option to declare Contractor in breach, or may purchase replacement insurance or pay the premiums that are due on existing policies in order to maintain the required coverages. Contractor is responsible for any payments made by City to obtain or maintain insurance and City may collect these payments from Contractor or deduct the amount paid from any sums due Contractor under this Agreement. 10.5 Submission of Insurance Policies. City reserves the right to require, at anytime, complete and certified copies of any or all required insurance policies and endorsements. 11. BUSINESS LICENSE Contractor will obtain and maintain a City of Carlsbad Business License for the term of the Agreement, as may be amended from time-to-time. City Attorney Approved DBE Version #04.16.02 4 12. ACCOUNTING RECORDS Contractor will maintain complete and accurate records with respect to costs incurred under this Agreement. All records will be clearly identifiable. Contractor will allow a representative of City during normal business hours to examine, audit, and make transcripts or copies of records and any other documents created pursuant to this Agreement. Contractor will allow inspection of all work, data, documents, proceedings, and activities related to the Agreement for a period of three (3) years from the date of final payment under this Agreement. 13. OWNERSHIP OF DOCUMENTS All work product produced by Contractor or its agents, employees, and subcontractors pursuant to this Agreement is the property of City. In the event this Agreement is terminated, all work product produced by Contractor or its agents, employees and subcontractors pursuant to this Agreement will be delivered at once to City. Contractor will have the right to make one (1) copy of the work product for Contractor’s records. 14. COPYRIGHTS Contractor agrees that all copyrights that arise from the services will be vested in City and Contractor relinquishes all claims to the copyrights in favor of City. 15. NOTICES The name of the persons who are authorized to give written notices or to receive written notice on behalf of City and on behalf of Contractor under this Agreement. For City: Carrie Loya-Smalley Senior Civil Engineer Public Works - Engineering City of Carlsbad 1635 Faraday Avenue Carlsbad, CA 92008 (760) 602-2746 For Contractor: Vipul Joshi Project Manager/Biologist Dudek & Associates 605 Third Street Encinitas, CA 92024 (760) 942-5147 Each party will notify the other immediately of any changes of address that would require any notice or delivery to be directed to another address. 16. CONFLICT OF INTEREST City will evaluate Contractor’s duties pursuant to this Agreement to determine whether disclosure under the Political Reform Act and City’s Conflict of Interest Code is required of Contractor or any of Contractor’s employees, agents, or subcontractors. Should it be determined that disclosure is required, Contractor or Contractor’s affected employees, agents, or subcontractors will complete and file with the City Clerk those schedules specified by City and contained in the Statement of Economic Interests Form 700. City Attorney Approved DBE Version #04.16.02 5 Contractor, for Contractor and . on behalf of Contractor’s agents, employees, subcontractors and consultants warrants that by execution of this Agreement, that they have no interest, present or contemplated, in the projects affected by this Agreement. Contractor further warrants that neither Contractor, nor Contractor’s agents, employees, subcontractors and consultants have any ancillary real property, business interests or income that will be affected by this Agreement or, alternatively, that Contractor will file with the City an affidavit disclosing this interest. 17. GENERAL COMPLIANCE WITH LAWS Contractor will keep fully informed of federal, state and local laws and ordinances and regulations which in any manner affect those employed by Contractor, or in any way affect the performance of the Services by Contractor. Contractor will at all times observe and comply with these laws, ordinances, and regulations and will be responsible for the compliance of Contractor’s services with all applicable laws, ordinances and regulations. Contractor will be aware of the requirements of the Immigration Reform and Control Act of 1986 and will comply with those requirements, including, but not limited to, verifying the eligibility for employment of all agents, employees, subcontractors and consultants that the services required by this Agreement. 18. DISCRIMINATION AND HARASSMENT PROHIBITED Contractor will comply with all applicable local, state and federal laws and regulations prohibiting discrimination and harassment. 19. DISADVANTAGED BUSINESS ENTERPRISE (DBE) PARTICIPATION A. The City has established no goals for the participation of DBE for this Agreement. However, Contractor shall be fully informed respecting Part 26, Title 49, Code of Federal Regulations (CFR), which is incorporated by reference, and is urged to obtain DBE participation should a clearly defined portion of the work become available. It is the policy of City that certified DBE firms shall have the maximum opportunity to participate in the performance of Agreements financed in whole or in part with federal funds. Contractor shall ensure that certified DBE firms, as defined in the CFR, have the maximum opportunity to participate in the performance of this Agreement and shall take all necessary and reasonable steps, as set forth in CFR, Part 26, for such assurance. Contractor shall not discriminate on the basis of race, color, national origin, or sex in the award and performance of subcontractor. Failure to carry out the requirements of this paragraph shall constitute a breach of Agreement and may result in termination of this Agreement or such other remedy that City may deem appropriate. B. City Attorney Approved DBE Version #04.16.02 6 C. If DBE participation is obtained, Contractor shall maintain records of all subcontractor agreements entered into with DBE subcontractors and records of materials purchased from DBE suppliers. Such records shall show each subcontractor's and vendor's name and address and the actual dollars paid to each. Upon completion of the Agreement, a summary of these records shall be prepared, certified correct and submitted on the form "FINAL REPORT - UTILIZATION OF DISADVANTAGED BUSINESS ENTERPRISES (DBE), FIRST - TIER SUBCONTRACTORS", or equivalent, by Contractor or his authorized representative to the City of Carlsbad's Contract Manager showing total dollars paid to each DBE subcontractor and supplier. Any DBE firm working as a subcontractor under this Agreement must be responsible for the execution of a distinct element of the work and must carry out its responsibility by actually performing, managing, and supervising the work. Contractor shall make every reasonable effort to replace a certified DBE firm that is unable to perform the provisions of this contract with another certified DBE firm. ' D. E. 20. DISPUTE RESOLUTION If a dispute should arise regarding the performance of the Services the following procedure will be used to resolve any questions of fact or interpretation not otherwise settled by agreement between the parties. Representatives of Contractor or City will reduce such questions, and their respective views, to writing. A copy of such documented dispute will be forwarded to both parties involved along with recommended methods of resolution, which would be of benefit to both parties. The representative receiving the letter will reply to the letter along with a recommended method of resolution within ten (1 0) business days. If the resolution thus obtained is unsatisfactory to the aggrieved party, a letter outlining the disputes will be forwarded to the City Manager. The City Manager will consider the facts and solutions recommended by each party and may then opt to direct a solution to the problem. In such cases, the action of the City Manager will be binding upon the parties involved, although nothing in this procedure will prohibit the parties from seeking remedies available to them at law. 21. TERMINATION In the event of the Contractor's failure to prosecute, deliver, or perform the Services, City may terminate this Agreement for nonperformance by notifying Contractor by certified mail of the termination. If City decides to abandon or indefinitely postpone the work or services contemplated by this Agreement, City may terminate this Agreement upon written notice to Contractor. Upon notification of termination, Contractor has five (5) business days to deliver any documents owned by City and all work in progress to City address contained in this Agreement. City will make a determination of fact based upon the work product delivered to City and of the percentage of work that Contractor has performed which is usable and of worth to City in having the Agreement completed. Based upon that finding City will determine the final payment of the Agreement. City Attorney Approved DBE Version #04.16.02 7 Either party upon tendering thirty (30) days written notice to the other party may terminate this Agreement. In this event and upon request of City, Contractor will assemble the work product and put it in order for proper filing and closing and deliver it to City. Contractor will be paid for work performed to the termination date; however, the total will not exceed the lump sum fee payable under this Agreement. City will make the final determination as to the portions of tasks completed and the compensation to be made. 22. COVENANTS AGAINST CONTINGENT FEES Contractor warrants that Contractor has not employed or retained any company or person, other than a bona fide employee working for Contractor, to solicit or secure this Agreement, and that Contractor has not paid or agreed to pay any company or person, other than a bona fide employee, any fee, commission, percentage, brokerage fee, gift, or any other consideration contingent upon, or resulting from, the award or making of this Agreement. For breach or violation of this warranty, City will have the right to annul this Agreement without liability, or, in its discretion, to deduct from the Agreement price or consideration, or otherwise recover, the full amount of the fee, commission, percentage, brokerage fees, gift, or contingent fee. 23. CLAIMS AND LAWSUITS By signing this Agreement, Contractor agrees that any Agreement claim submitted to City must be asserted as part of the Agreement process as set forth in this Agreement and not in anticipation of litigation or in conjunction with litigation. Contractor acknowledges that if a false claim is submitted to City, it may be considered fraud and Contractor may be subject to criminal prosecution. Contractor acknowledges that California Government Code sections 12650 et seq., the False Claims Act applies to this Agreement and, provides for civil penalties where a person knowingly submits a false claim to a public entity. These provisions include false claims made with deliberate ignorance of the false information or in reckless disregard of the truth or falsity of information. If City seeks to recover penalties pursuant to the False Claims Act, it is entitled to recover its litigation costs, including attorney's fees. Contractor acknowledges that the filing of a false claim may subject Contractor to an administrative debarment proceeding as the result of which Contractor may be prevented to act as a Contractor on any public work or improvement for a period of up to five (5) years. Contractor acknowledges debarment by another jurisdiction is grounds for City to terminate this Agreement. 24. JURISDICTIONS AND VENUE Any action at law or in equity brought by either of the parties for the purpose of .. enforcing a right or rights provided for by-this Agreement will be tried in a court of competent jurisdiction in the County of San Diego, State of California, and the parties waive all provisions of law providing for a change of venue in these proceedings to any other county. City Attorney Approved DBE Version #04.16.02 8 25. SUCCESSORS AND ASSIGNS It is mutually understood and agreed that this Agreement will be binding upon City and Contractor and their respective successors. Neither this Agreement or any part of it nor any monies due or to become due under it may be assigned by Contractor without the prior consent of City, which shall not be unreasonably withheld. 26. ENTIRE AGREEMENT This Agreement, together with any other written document referred to or contemplated by it, dong with the purchase order for this Agreement and its provisions, embody the entire Agreement and understanding between the parties relating to the subject matter of it. In case of conflict, the terms of the Agreement supersede the purchase order. Neither this Agreement nor any of its provisions may be amended, modified, waived or discharged except in a writing signed by both parties. City Attorney Approved DBE Version #04.16.02 9 27. AUTHORITY The individuals executing this Agreement and the instruments referenced in it on behalf of Contractor each represent and warrant that they have the legal power, right and actual authority to bind Contractor to the terms and conditions of this Agreement. DUDEK &ASSOCIATES, a (print namehitie) ATTEST: LORRAINE -p+L+ M. WO City Clerk If required by City, proper notarial acknowledgment of execution by contractor must be attached. If a Corporation, Agreement must be signed by one corporate officer from each of the following two groups. *Group A. Chairman, President, or Vice- P res ident **Group B. Secretary, Assistant Secretary, CFO or Assistant Treasurer Otherwise, the corporation must attach a resolution certified by the secretary or assistant secretary under corporate seal empowering the officer(@ signing to bind the corporation. APPROVED AS TO FORM: RONALD R. BALL, City Attorney Deputy City Attorney City Attorney Approved DBE Version #04.16.02 10 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT State of California personally appeared Name@) 01 Signer(s) hrsonally known to me 0 proved to me on the basis of satisfactory evidence acted, executed the instrument. WITNESS my hand and official seal. *c L- PJ Signature of Notary Public Though fhe information below is not required by law, it may prove valuable to persons relying on the document and could prevenf fraudulent removal and reattachment of this form to another document. Description of Attached Document Title or Type of Document: Document Date: Signer@) Other Than Named Above: Capacity(ies) Claimed by Signer 0 Corporate Officer - Title@): 0 Partner - 0 Limited 0 General 0 Attorney-in-Fact 0 Guardian or Conservator Signer Is Representing: D 1999 National Notary Association * 9350 De Soto Ave.. PO. Box 2402 - Chatsworth. CA 91313-2402 * w\wy nahonalnotary org Pmd. No 5907 Reorder: Call TolbFree 1-800-876-6827 EXHIBIT “A” SCOPE OF SERVICES Itemized List of what Contractor will do for City and at what price. City Attorney Approved DBE Version #04.16.02 11 & ASSOCIATES, INC. Professional Teams for Complex Projects Engineering, Planning, Environmental Sciences and Management Services Encinitas, California 92024 Fax 760.632.0164 Corporate Office: 605 Third Street 760.942.51 47 RECEIVED FEB 2% 2003 February 24,2003 EXHIBIT “A” 3262-01 Ms. Carrie Loya-Smalley Senior Civil Engineer City of Carlsbad 1635 Faraday Avenue Carlsbad, California 92008 ENGINEERING DEPARTMEKT Re: Biological Services for the Rancho Santa Fe Road Realignment and Bridge Replacement Project, Phase I Dear Ms. Loya-Smalley: Dudek & Associates, Inc. (DUDEK) would like to provide the City oE Carlsbad (City) with an updated scope of work to reflect the biological services DUDEK will be providing as the Rancho Santa Fe Road Realignment and Bridge Replacement project enters construction for Phase I. DUDEK is currently working under Amendment No. 1 OE an agreement for environmental services (PWENG 267, PO#P110874). Although a portion of the budget remains from Amendment No. 1, the scope associated with that amendment only covers environmental services during the first three months of construction in the summer of 2002. The purpose oE this letter is to clarify the scope of services DUDEK will be providing for the upcoming phase of construction in compliance with the resource permits associated with the project. For this scope of work, it is assumed that construction will take approximately 14 months (59 weeks) to complete, from February 10,2003 to April 10,2004. SCOPE OF WORK Qualified DUDEK biologists will conduct periodic surveys of potential habitat €or the coastal CaliEornia gnatcatcher (Poliopila polioptila califorttica; gnatcatcher) within 500 feet of the project limits during the breeding season (February 15 to August 31) while construction is ongoing. The purpose of the surveys will be to determine the presence and location of gnatcatchers within adjacent habitat areas and to assess the need to mitigate potential noise impacts. The gnatcatcher monitoring program will be implemented in a manner acceptable to the U.S. Fish and WildliEe Service (USFWS) as required by the Biological Opinion issued on January 23,2002. This scope provides weekly gnatcatcher monitoring during the breeding season (36 weeks total; February 15-August 31,2003 and February 15-April 10,2004) for the 14-month construction period and the preparation of two final monitoring reports to be submitted to the USFWS following the completion of surveys for each breeding season. Cost estimate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $36,000.00 Ms. Carrie Lo ya-Smalle y Re: Biological Services for the Rancho Santa Fe Road Realignment and Bridge Replacement Project, Phase I Task 2 Employee Education Program The project lead biologist will attend the pre-construction meeting and give a brief presentation regarding the biological resources on and adjacent to the project area and the various regulatory guidelines which govern construction effects to those resources. The employee education program is a requirement of the Biological Opinion issued by the USFWS. The representatives of all contractors and subcontractors shall be in attendance at the pre-construction meeting and communicate the information regarding biological resources to their employees working on the job site. If new crews or contractors are brought on, a new education meeting shall be held. This scope provides for up to two employee education presentations. Cost estimate ................................................ $I,OOO.OO Task 3 Biological Construction Monitoring DUDEK will provide a qualified biologist to monitor the City’s construction activities of the project site in accordance with documents prepared and approved pursuant to the federal Endangered Species Act (ESA), National Environmental Policy Act (NEPA), federal Clean Water Act (CWA), California Environmental Quality Act (CEQA), California Fish and Game Code, and the Habitat Conservation PladOngoing Multi-Species Plan (HCP) for the project area. Portions of this project or adjacent projects initiated by anyone other than the City of Carlsbad, will not be monitored as part of this scope and €ee. It is expected that 14 months will be required to complete the City’s portion of grading and construction. During the gnatcatcher breeding season, the level of monitoring required will be determined based on the results of the gnatcatcher monitoring program. For example, if nests are observed adjacent to the construction area, daily monitoring may be required to ensure construction activities do not disturb nesting behavior. However, if no nests are observed, weekly monitoring may be adequate to ensure that adjacent preserved habitat is not being impacted. Although gnatcatchers may attempt to breed more than once in a single season, breeding activity is not likely to be continuous for the duration of the breeding season. Based on a reasonable expectation of gnatcatcher breeding activity and for the purpose of providing a cost estimate, this scope anticipates that gnatcatcher breeding activity will be observed for 26 weeks in 2003 and for six weeks in 2004. Therefore this scope provides for a total of 32 weeks of daily monitoring during active gnatcatcher breeding and 27 weeks of weekly monitoring unrestricted by gnatcatcher breeding activity. Cost estimate .............................................. $58,000.00 3262-01 February 24,2003 Page 2 P,*Snn,.l liamr for Complu PIO,<EtI Ms. Carrie Lo ya-Smalle y Re: Biological Services for the Rancho Santa Fe Road Realignment and Bridge Replacement Project, Phase I ~ ~~ Task 4 Monthly/Annual Reporting Monthly monitoring reports will be provided to the City of Carlsbad staFF and USFWS as required by the Biological Opinion. These reports will summarize monitoring activities and report on compliance with permit regulations. Based on a 14-month construction schedule, this task would include 14 monthly reports and two annual reports. Cost estimate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $IZOOO.OO ESTIMATED COSTS The estimated labor cost for the proposed biological services is $112,000.00, to be billed on a time and materials basis in accordance with our 2003 Standard Schedule of Charges (see attached). Direct costs are billed at a 15% markup. Direct costs are anticipated to be approximately $3,500.00. The total budget amount for the above scope is $1 15,500.00. This proposal includes tasks associated with Phase 1 of the project only. These costs are based on a work schedule of 14 months, €rom February 10,2003 to April 10,2004. If the City requires additional services beyond April 10,2004, an additional fee can be negotiated at such time. Please send an appropriate contract amendment or new agreement to authorize the above scope and budget. Please let me know if you have any questions regarding this proposal. Very truly yours, Dudek & Associates, Inc. Project Mxnager/Biologis t Environmental Science Division cc: Kam Muri - DUDEK Brock Orrega - DUDEK Doug Helming - Helming Engineering, Inc. 2003 DLJDEK Standard Schedule of Charges art: 3262-01 February 24,2003 Page 3 DUDEK & ASSOCIATES. INC . 2003 STANDARD SCHEDULE OF CHARGES Engineering Services Principal Engineer ....................................... $145.00/hr Project Manager .......................................... $130.00/hr Associate Engineer ..................................... $115.00/hr Assistant Engineer ........................................ $95.00/hr Project Engineer II ........................................ $95.00/hr Project Engineer I ......................................... $85.00/hr Resident Engineer ........................................ $95.00/hr Field Engineer ............................................... $85.00/hr Engineering Inspector II ................................ $80.00/hr Engineering Inspector I ................................. $70.00/hr Engineering Assistant ................................... $60.00/hr Planning Planning Project Manager ........................... $120.00/hr Senior Planner ............................................ ~~~~~~OO/hr Project Planner ............................................. $90.00/hr Research Planner ......................................... $85.00/hr Assistant Planner ...................... ................... $65.00/hr Planning Technician ...................................... $60.00/hr Planning Drafter ............................................ $55.00/hr Senior Engineer .......................................... $125.00/hr Surveying Division Manager/Licensed Surveyor .......... $1 25.00/hr Mapping & Legal Project Manager ................ $95.00/hr Field SurveyorlSurvey Analyst ...................... $90.00/hr Assistant Survey Analyst ............................... $85.00/hr Mapping & Legal Technician ......................... $75.00/hr Survey Technician ........................................ $65.00/hr 1- Person Survey Crew ............................... $125.0O/hr 2- Person Survey Crew ............................... $155.00/hr 3- Person Survey Crew ............................... $195.00/hr Hydrogeological Services Principal ...................................................... $1 70.00/hr Sr . HydrogeologistlSr . Project Manager ...... $1 30.001hr Associate HydrogeologistlEngineer ............ $1 15.00/hr Hydrogeologist IV/Engineer IV ...................... $95.00/hr Hydrogeologist IlllEngineer 111 ....................... $85.00/hr Hydrogeologist IVEngineer I1 ......................... $75.00/hr Hydrogeologist VEngineer I ........................... $65.00/hr Technician ..................................................... $55.00/hr Environmental Services Principal ...................................................... $150.00/hr Senior Project manager/Specialist .............. $1 40.00/hr Environmental SpecialistlPlanner VI ........... $1 30.00/hr Environmental SpecialistlPlanner V ............ $1 25.00/hr Environmental SpecialistlPlanner IV ........... $1 15.00/hr Environmental SpecialistlPlanner 111 ........... $1 05.001hr Environmental SpecialistlPlanner II .............. $90.00/hr Environmental SpecialistlPlanner I ............... $80.00/hr Analyst .......................................................... $70.00/hr Research Analyst .......................................... $ 60.001hr Construction Management Services PrincipallManager ....................................... $1 40.001hr Construction Manager ................................. $125.00/hr Senior Project Manager .............................. $1 15.001hr Project Manager .......................................... $105.00/hr Construction Engineer .................................. $95.00/hr Construction Inspector 111 .............................. $85.00/hr Construction Inspector II ............................... $80.00/hr Construction Inspector I ................................ $75.00/hr District Management & Operations District General Manager ............................ $145.00/hr District Engineer .......................................... $1 10.00/hr District Manager II ....................................... $120.00/hr District Manager I ........................................ $100.00/hr District Manager Assistant ............................ $70.00/hr District Secretaty/Account ............................ $70.00/hr Grade V Operator ......................................... $9O.OO/hr Grade IV Operator ........................................ $80.00/hr Grade 111 Operator ......................................... $65.00/hr Grade II Operator ........................................ ..$5 5.00/hr Grade I Operator ........................................... $ 52.00/hr Operator in Training ...................................... $40.00/hr Laborer ......................................................... $ 34.00/hr Urban and Community Forestry Principallsenior Consulting Arborist ............ $1 50.00/hr Senior Project Manager V ........................... $13 5.00/hr Senior Project Manager IV .......................... $120.00/hr Senior Project Manager 111 .......................... $105.00/hr Project Manager II ......................................... $90.00/hr Project Manager I .......................................... $75.00/hr CertifiedlConsulting Arborist ................ $90-$150.00/hr Certified Forester ........................................ $ 120.00/hr Global Position System Technician ............... $75.00/hr Data Collection Specialist ............................. $60.00/hr Research Assistant ....................................... $50.00/hr GIS Equipment Charge .............................. $50.00/day Resistograph .............................................. $30.00/day Office Services TechnicalDra fting/CADD Services 3D Graphic Artist ......................................... $125.00/hr Senior Designer ............................................ $95.00/hr GIS Specialist II ............................................ $90.00/hr GIS Specialist I ............................................. $80.00/hr CADDl Designer ........................................... $85.00/hr CADD Drafter ............................................... $ 75.00/hr CADD Operator 1 ........................................... $6 5.00/hr Assistant Designer Drafter ............................ $65.00/hr Support Services Computer Processing ................................... $ 65.00/hr Clerical Administration .................................. $60.00/hr Forensic Engineering -Court appearances and depositions as expert witness will be billed at 1.75 times normal rates . Emergency and Holidays - Minimum charge of two hours will be billed at 1.5 times the normal rate . Material and Outside Services - Subcontactors . rental of special equipment. special repfaductions and blueprinting. outside data processing and computer services. etc., are charged at 1.15 times the direct cost . Travel Expenses - Mileage at 36.0 cents per mile . Per diem where overnight stay is involved is charged at cost Effective January 1. 2003 U DUDEK & ASSOCIATES. INC . 2003 STANDARD SCHEDULE OF CHARGES MAwma Engineering Services Project Manager ......................................... $130.00/hr Senior Engineer .......................................... $125.00/hr Associate Engineer .................................... $115.00/hr Project Engineer I1 ........................................ $95.00/hr Project Engineer I ......................................... $85.00/hr Resident Engineer ........................................ $95.00/hr Field Engineer .............................................. $85.00/hr Engineering Inspector II ................................ $80.00/hr Engineering Inspector I ................................. $70.00/hr Engineering Assistant ................................... $60.00/hr Planning Planning Project Manager .......................... $120.00/hr Senior Planner ............................................ $100.00/hr Project Planner ............................................. $90.00/hr Research Planner ......................................... $85.00/hr Assistant Planner ......................................... $65.00/hr Planning Technician ..................................... $60.00/hr Planning Drafter ........................................... $55.00/hr Surveying Division ManagerILicensed Surveyor ......... $125.00/hr Field SurveyodSurvey Analyst ..................... $90.00/hr Assistant Survey Analyst .............................. $85.00/hr Mapping & Legal Technician ........................ $75.00/hr Survey Technician ........................................ $65.00/hr 1- Person Survey Crew .............................. $125.00/hr 2- Person Survey Crew ............................... $155.00/hr 3- Person Survey Crew .............................. $195.00/hr Hydrogeological Services Principal ...................................................... $170.00/hr Principal Engineer ...................................... $145.00/hr Assistant Engineer ....................................... $95.00/hr Mapping & Legal Project Manager ............... $95.00/hr Sr . HydrogeologisVSr . Project Manager ..... $1 30.00/hr Associate HydrogeologisVEngineer ............ $1 15.00/hr Hydrogeologist IV/Engineer IV ..................... $95.00/hr Hydrogeologist IlVEngineer 111 ...................... $85.00/hr Hydrogeologist IllEngineer II ........................ $75.00/hr Hydrogeologist VEngineer I .......................... $65.00/hr Technician .................................................... $55.00/hr Environmental Services Principal ...................................................... $150.00/hr Senior Project Manager/Specialist ............. $140.00/hr Environmental SpecialisVPlanner VI .......... $1 30.00hr Environmental SpecialisVPlanner V ........... $125.00/hr Environmental SpecialisVPlanner IV .......... $1 15.001hr Environmental SpecialisVPlanner Ill ........... $1 05.001hr Environmental SpecialisVPlanner I1 .............. $90.00/hr Environmental SpecialistlPlanner I ............... $80.00/hr Analyst .......................................................... $70.00/hr Research Analyst ......................................... $60.00/hr Construction Management Services PrincipaVManager ...................................... $140.00/hr Construction Manager ................................ $125.00/hr Senior Project Manager .............................. $1 15.00/hr Project Manager ......................................... $105.00/hr Construction Engineer .................................. $95.00/hr Construction Inspector 111 .............................. $85.00/hr Construction Inspector II ............................... $80.00/hr Construction Inspector I ................................ $75.00/hr District Management 8 Operations District General Manager ............................ $145.00/hr District Engineer ......................................... $1 10.00/hr District Manager I1 ...................................... $120.00/hr District Manager I ....................................... $100. 00/hr District Manager Assistant ............................ $70.00/hr District SecretarylAccount ........................... $70.00/hr Grade V Operator ......................................... $90.00/hr Grade IV Operator ........................................ $80.00/hr Grade 111 Operator ........................................ $65.00/hr Grade I1 Operator ......................................... $55.00/hr Grade I Operator .......................................... $52.00/hr Operator in Training ..................................... $40.00/hr Laborer ......................................................... $34.00/hr Urban and Community Forestry PrincipaVSenior Consulting Arborist ........... $1 50.00/hr Senior Project Manager V .......................... $135.00/hr Senior Project Manager IV ......................... $120.00/hr Senior Project Manager 111 .......................... $105.00/hr Project Manager II ........................................ $90.00/hr Project Manager I ......................................... $75.00/hr Certified/Consulting Arborist ................ $90-$150.00/hr Certified Forester ........................................ $120.00/hr Global Position System Technician .............. $75.00/hr Data Collection Specialist ............................. $60.00/hr Research Assistant ...................................... $50.00/hr GIS Equipment Charge .............................. $ 50.00/day Resistograph .............................................. $30.00/day Office Services Technical/DraftingCADD Services 30 Graphic Artist ........................................ $125.00/hr Senior Designer ............................................ $95.00/hr GIS Specialist II ............................................ $90.00/hr GIS Specialist I ............................................. $80.00/hr CADDl Designer .......................................... $85.0O/hr CADD Drafter ............ ............................ $75.00/hr CADD Operator 1 .......................................... $65.00/hr Assistant Designer Drafter ............................ $65.00/hr Support Services Computer Processing ................................... $65.00/hr Clerical Administration .................................. S60.001hr Forensic Englneering . Court appearances and deposilions as expert witness will be billed at 1.75 times normal rates . Emergency and Holldays . Minimum charge of two hours will be billed at 1.5. times the normal rate . Material and Outslde Services - Subcontacton. rental of special equipment . special reprodudions and blueprinting. outside data processing and computer services . etc .. are charged at 1.15 times the direct cost . Travel Expenses - Mileage at 36.0 cents per mile . Per diem where overnight stay is involved is charged at cost Effective January 1. 2003 P ENGlNEERlNG SERVICES Principal Engineer .............................................. $1 40.00/hr Project Manager ................................................. $130.W/hr Senior Engineer ................................................. $115.00/hr Associate Engineer ............................................ $105.00/hr Project Engineer II .............................................. $95.00/hr Project Engineer I ............................................... $85.00/hr Resident Engineer .............................................. $95.00/hr Field Engineer .................................................... $85.00/hr Engineering Inspector I1 ..................................... $75.00/hr Engineering Inspector I ...................................... $65.00/hr Engineering Assistant ........................................ S55.00/hr PLANNING Planning Project Manager .................................. S 11 5.00/hr Senior Planner ................................................... .. .. ... $ 90.00/hr Project Planner ................................................... $ 80.00/hr Research Planner ..._........................... .......-...... $ 70.0mr Assistant Planner ..-........................................... $ 65.00/hr Planning Technician ........................................... $ 60.00/hr Planning Drafter ................................................. S 55.00/hr Division Manager / Licensed Surveyor ............... $ 125.00fir Surveying & Mapping Mg / Licensed Surveyor $115.00/hr ... Mapping 8 Legal pmiect Manager ..................... $ 9o.oQlhr Field Supervisor / Survey Analyst .. ;. ....-............ $ 90.001hr Assistant Swvey Analyst ...-..............._....-....... $ 85.Wr Mapping 8 Legal Technician .............................. S 70.00/hr Survey Technician ............................................. $ 60.00/hr 1-Person Survey Crew ....................................... S 125.00/hr 2-Person Survey Crew ....................................... $ 155.00hr 3-Person Survey Crew ....................................... S 195.00/hr ! SURVEYING ' > . J HYDROGEOWGICAL SERVICES Principal .. ...................................................... $ 165.00/hr Sc Hydrogedogistl Sr . Pmject Manager ............. $ 130.00/hr Assaciiab, Hydmgeologii / hgineer .....-.......... $ 115.00/hr Hyclrogeobgist IV/ Engineer IV .....- .....-........... $ 95.Whr Hydrogeologist 111 / Engineer !!I ................... % ..... $ 80.00/hr Hydrogeologist I1 / Engineer II ....................... : .... S 75.00/hr Hydrogeologist I / Engmeer I ............................. $ 65.00/hr Technician ........................................................ $ 55.00/hr Principal ............................. ..................... : ....... S 150.0P/hr Environmental Specialist /Planner V ................... S 115.00/hr Environmental Specialist planner IV .................. $ 105.00/hr Environmental Specialist /Planner 111 .................. $ 95.00/hr Environmental Specialist /Planner I1 ................... $ 80.00/hr Environmental Specialist /Planner I .................... $ 70.00/hr Analyst ............................................................... $ 60.00/hr Research Assistant ............................................. $ 50.00/hr ENVIRONMENTAL SERVICES : .> Senior Projecthnageflpe cialist ...................... $ 140.00hr Environmental SpecialisUPlanner VI ................... $ 125.00/hr CONSTRUCTION MANAGEMENT SERVICES Principal / Manager ............................................ 5 130.00/hr Construction Manager ....................................... $ 120.00/hr Senior Project Manager ...................................... $ 110.00hr Project Manager ................................................. $ 100.00/hr Construction Engineer ....................................... 5 90.00/hr Construction inspector ill ................................... $ 80.00/hr Construction Inspector II .................................... $ 70.00hr Construcbon Inspector I ..................................... $ 75.00/hr District General Manager .................................... $ 140.00/hr District Engineer ............................................ $ 110.00/hr District Manager I1 .............................................. 511 O.OO/hr District Manager I ............................................... $ 95.00/hr Disbsct ManagerAssistant .................................. $ 70.00jhr District Sacretary/Accountant ............................. $ 70.00/hr Grade N Operator ................-............................. $ 80.00hr Grade 111 OperatDr ............................................... $ 65.00hr Grade I1 Operator ................................................ 5 55.00/hr Grade I Operator ................................................. $ 52.00/hr Operator in Training ........................................... $ 40.00hr Laborer .............................................................. 8 34.00/hr lnfomration Systems Manager ............................ $ 155.00/hr Systlems Techrdcbn U ........................................ S 100.00/hr DISTRICT MANAGEMENT & OPERATIONS .. I INFORMATION SYSTEMS PRINCIPAL .......................................... $ 140.00 - $165.0o/hr OFFICE SERVICES { TECHNICAL / DRAFTINWCADD SERVICES 30 Graphic Artist.,, ........................................ $ 120.00hr Senior Designer -- ........................................... $ 90.00/hr GIs Technidan U ._. ................................ $ 90.00/hr GIs Technidan I ............................................... $ 80.00/hr CAW /Des@w UI _I ............................... ...-... $ 85.OO/hr CADD /Designer I ._ ..................................... $ 85.00/hr CADD Drafter I ................................................... $ 75.00hr CADD Operahw II ................................................ $ 70.0O/hr CADD Operator I ................................................ $ 65.00/hr Assistant Designer Drafter .................................. $ 65.00/hr SUPPORT SERVICES. - Computer Rncessing ......................................... 5 65.OOhr Clerical Administation ....................................... 5 55.00hr #)RMsIcE#GDBRpIGcartl(lpea;nceswddepositiasasarpert~wa be bakd at1rtmesrormal la& . EMERGENCY AND HWDAW .MMmm nalnalak dtwohows Wg bebikd at 1.5 times be MAnWALANDrnM~-.Slrbaonb9bn.rergldspeddequipllent. SpedalreproduCbDns ~ ad~ou$idedatapmQssingandcomplter senices elc . aR drapes tt1.15 times he dnectcost TRAVEL EXPENSES Mileage at 34.5 cents per mile . Per dim where wemight stay Effective December 4. 2001 is involved is charged at cost .