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CC - CONSENT ITEM: Approval of a Five-Year Professional Services Agreement with NBS Government Finance Group for the Development of Administrative Overhead Cost Allocation Plans for a Total Amount Not to Exceed $70,500.
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Meeting Date: October 28, 2024
Contact Person/Dept: Lisa Soghor/Finance Department
Phone Number: (310) 253-5865
Fiscal Impact: Yes [X] No [] General Fund: Yes [X] No []
Attachments: Yes [] No [X]
Public Notification: (E-Mail) Meetings and Agendas - City Council (10/23/2024)
Department Approval: Lisa Soghor, Chief Financial Officer (10/15/2024)
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RECOMMENDATION
Staff recommends the City Council approve a five-year professional services agreement with NBS Government Finance Group (NBS) for the development of administrative overhead cost allocation plans for a total amount not to exceed $70,500.
BACKGROUND
Cost allocation refers to a process of accounting and recording the full costs of a government service by including its indirect costs or "overhead" in addition to its direct costs. Direct costs are those that clearly and directly benefit a specific fund or program. Indirect costs or central services are for support services that are shared by multiple departments, programs, and funds, such as accounting, payroll, administrative services, human resources, information technology, and operating and maintenance costs for city hall or other shared buildings. A cost allocation plan distributes these indirect costs to ensure that the respective funds are fairly and accurately paying for the services they receive.
Local governments develop cost allocation plans to identify the actual cost of services being provided to its citizens and to equitably share the costs of facilities and support services between departments, programs, and funds. Cost allocation plans ensure the accuracy of cost-based user fees for public services. These plans reli...
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