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HomeMy WebLinkAboutResolution - 2014-R0107 - Contract - PM Cattle LLC - Cattle Grazing - 03/27/2014Resolution No. 2014-RO 107 March 27, 2014 Item No. 5.12 RESOLUTION BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT the Mayor of the City of Lubbock is hereby authorized and directed to execute for and on behalf of the City of Lubbock, Contract No. 11753 for cattle grazing on Hancock Land Application Site by and between the City of Lubbock and PM Cattle, LLC, of Southland, Texas, and related documents. Said Contract is attached hereto and incorporated in this resolution as if fully set forth herein and shall be included in the minutes of the City Council. Passed by the City Council on March 27, 2014 Ile GLE ROBERTSON, MAYOR ATTEST: Rebell Garza, City Secret APPROVED AS TO CONTENT: k. /�j Ij R. Keith Smith, P.E., Director of Public Works APPROVED AS TO FORM: r' Chad Weaver, Assistant City Attorney vw:ccdocs'RES. Contract -PM Cattle March 13, 2014 Resolution No. 2014-R0107 Contract 11753 City of Lubbock, TX Cattle Grazing at the Hancock Land Application Site Agreement This Service Agreement (this "Agreement") is entered into as of the 27th day of March, 2014, ("Effective Date") by and between PNI Cattle, LLC , (the Contractor ),and the City of Lubbock (the "City"). RECITALS WHEREAS, the City has issued a Request for Proposals 14 -11753 -MA, Cattle Grazing at the Hancock Land Application Site. WHEREAS, the proposal submitted by the Contractor has been selected as the proposal which best meets the needs of the City for this service; and WHEREAS, Contractor desires to perform as an independent contractor to provide Cattle Grazing at the Hancock Land Application Site, upon terms and conditions maintained in this Agreement; and NOW THEREFORE, for and in consideration of the mutual promises contained herein, the City and Contractor agree as follows: City and Contractor acknowledge the Agreement consists of the following exhibits which are attached hereto and incorporated herein by reference, listed in their order of priority in the event of inconsistent or contradictory provisions: 1. This Agreement 2. Exhibit A — General Requirements 3. Exhibit B — Proposal and Price Sheet 4. Exhibit C — Insurance Requirements Scope of Work Contractor shall provide the services that are specified in Exhibit A. The Contractor shall comply with all the applicable requirements set forth in Exhibit B and C attached hereto. Article 1 Services 1.1 Contractor agrees to perform services for the City that are specified under the General Requirements set forth in Exhibit A. The City agrees to pay the amounts stated in Exhibit B, to Contractor for performing services. 1.2 Contractor shall use its commercially reasonable efforts to render Services under this Agreement in a professional and business -like manner and in accordance with the standards and practices recognized in the industry. 1.3 Nonappropriation clause. All funds for payment by the City under this Agreement are subject to the availability of an annual appropriation for this purpose by the City. In the event of nonappropriation of fiends by the City Council of the City of Lubbock for the goods or services provided under the Agreement, the City will terminate the Agreement, without termination charge or other liability, on the last day of the then -current fiscal year or when the appropriation made for the then -current year for the goods or services covered by this Agreement is spent, whichever event occurs first. If at any time funds are not appropriated for the continuance of this Agreement, cancellation shall be accepted by the Contractor on thirty (30) days prior written notice, but failure to give such notice shall be of no effect and the City shall not be obligated under this Agreement beyond the date of termination. Article 2 Miscellaneous. 2.1 This Agreement is made in the State of Texas and shall for all purposes be construed in accordance with the laws of said State, without reference to choice of law provisions. 2.2 This Agreement is performable in, and venue of any action related or pertaining to this Agreement shall lie in, Lubbock, Texas. 2.3 This Agreement and its Exhibits contains the entire agreement between the City and Contractor and supersedes any and all previous agreements, written or oral, between the parties relating to the subject matter hereof. No amendment or modification of the terms of this Agreement shall be binding upon the parties unless reduced to writing and signed by both parties. 2.4 This Agreement may be executed in counterparts, each of which shall be deemed an original. 2.5 In the event any provision of this Agreement is held illegal or invalid, the remaining provisions of this Agreement shall not be affected thereby. 2.6 The waiver of a breach of any provision of this Agreement by any parties or the failure of any parties otherwise to insist upon strict performance of any provision hereof shall not constitute a waiver of any subsequent breach or of any subsequent failure to perform. 2.7 This Agreement shall be binding upon and inure to the benefit of the parties and their respective heirs, representatives and successors and may be assigned by Contractor or the City to any successor only on the written approval of the other party. 2.8 All claims, disputes, and other matters in question between the Parties arising out of or relating to this Agreement or the breach thereof, shall be formally discussed and negotiated between the Parties for resolution. In the event that the Parties are unable to resolve the claims, disputes, or other matters in question within thirty (30) days of written notification from the aggrieved Party to the other Party, the aggrieved Party shall be free to pursue all remedies available at law or in equity. 2.9 At any time during the term of the contract, or thereafter, the City, or a duly authorized audit representative of the City or the State of Texas, at its expense and at reasonable times, reserves the right to audit Contractor's records and books relevant to all services provided to the City under this Contract. In the event such an audit by the City reveals any errors or overpayments by the City, Contractor shall refund the City the full amount of such overpayments within thirty (30) days of such audit findings, or the City, at its option, reserves the right to deduct such amounts owing the City from any payments due Contractor. 2.10 The City reserves the right to exercise any right or remedy to it by law, contract, equity, or otherwise, including without limitation, the right to seek any and all forms of relief in a court of competent jurisdiction. Further, the City shall not be subject to any arbitration process prior to exercising its unrestricted right to seek judicial remedy. The remedies set forth herein are cumulative and not exclusive, and may be exercised concurrently. To the extent of any conflict between this provision and another provision in, or related to, this document, this provision shall control. IN WITNESS WHEREOF, this Agreement is executed as of the Effective Date. CITY OF LUBBOCK, TX: Glen o e o , ayor A T!�.). , ""� . , _..' _�� Re Iecca Garza, City Secretary (-� APPROVED AST ONT R. Keith Smith, P.E, Director of Public Works APP ROV TO RM: ChadWeaver, Assistant City Attorney Contractor: d Contrac Signature 6 1'eY G JAAf; FL Printed Name C Title CITY OF LUBBOCK, TEXAS Cattle Grazing on Hancock Land Site RFP 14 -11753 -MA GENERAL REQUIREMENTS 1 INTENT Exhibit A a) The City of Lubbock (hereinafter called "City") is seeking proposals from interested firms and individuals, (hereinafter called "Proposer") to provide Cattle Grazing for at the Hancock Land Application Site. b) Offerors are invited to submit demonstrated competence and qualifications of their firm for providing these services. c) The information contained within this document is intended to provide interested firms with the requirements and criteria that will be used to make the selection. 2 PROJECT DESCRIPTION The City Land applies wastewater effluent at the Hancock Land Application Site. Jose wheat grass is grown on the site to uptake the nitrogen in the wastewater that might leach into the groundwater. Cattle use the Jose wheat grass as forage to help to maintain the site. 3 PURPOSE OF THE PROJECT The City of Lubbock Land Application Sites are operated under a TCEQ Wastewater permit that governs all activity on the site. Compliance with the wastewater permit and all applicable supplementary operating plans will be strictly enforced. 4 SCOPE OF WORK The proposal bid price will be per animal unit per year. Mature cow or breeding age heifer, mature breeding age bull, and cow/calf pair where the calf is not weaning age will be considered an animal unit. Calves weighing in excess of 500 lbs. that have not been weaned will be considered an animal unit for billing purposes. The annual bid price per animal unit will be divided by the number of days in the applicable year. The daily price per animal unit will be multiplied by the number of days each animal unit was grazed during an applicable month and the cattle owner will be billed at the end of the every month. Cattle owner is responsible for maintaining accurate daily head counts. City of Lubbock personnel will work closely with cattle owner or designee to insure accurate head counts are kept for billing purposes. All cattle movement on or off the site must be turned into the designated city personnel within 24 hours of inventory changes. The cattle owner is responsible for providing an onsite caretaker for cattle. The caretaker is required to check the cattle at least three times per week and maintain an accurate daily inventory of cattle. In the event of an emergency, the cattle owner is required to have a caretaker onsite within I hours notice. The City maintains permanent and temporary fencing and water wells/troughs. The City is not responsible to process, move, load, unload or haul cattle. That is the cattle owner's responsibility. The City is not to be held responsible for cattle deaths caused by irrigation equipment, electrical equipment, traffic accidents, or acts of God. The City will not be held liable for damage to private property when cattle get out for whatever reason. It is the cattle owner's responsibility. The Hancock Land Application Site Grazing contract is for one owner only. The contract cannot be subleased. 600 head of cattle +/- 150 head as dictated by available grazing conditions. Cattle are to be mature breeding age beef cattle including breeding bulls. Successful bidder will need to have the HLAS stocked within 30 days. Stocking rates must be maintained at optimum levels year round in order to fully utilize available forage while not overgrazing the site. 5 CONTACT TERM The contract shall be for a period of five years with the option to renew an additional five- one-year extensions said date of term beginning upon formal approval. The term of contract shall remain in effect until the expiration date, performance of services ordered, or termination of by either party with a thirty (30) day written notice. Exhibit C INSURANCE SECTION A. Prior to the approval of this contract by the City, the Contractor shall furnish a completed Insurance Certificate to the City, which shall be completed by an agent authorized to bind the named underwriter(s) to the coverages, limits, and termination provisions shown thereon, and which shall furnish and contain all required information referenced or indicated thereon. THE CITY SHALL HAVE NO DUTY TO PAY OR PERFORM UNDER THIS CONTRACT UNTIL SUCH CERTIFICATES) HAVE BEEN DELIVERED TO THE CITY. INSURANCE COVERAGE REQUIRED SECTION B. The City reserves the right to review the insurance requirements of this section during the effective period of the contract and to require adjustment of insurance coverages and their limits when deemed necessary and prudent by the City based upon changes in statutory law, court decisions, or the claims history of the industry as well as the Contractor. SECTION C. Subject to the Contractor's right to maintain reasonable deductibles in such amounts as are approved by the City, the Contractor shall obtain and maintain in full force and effect for the duration of this contract, and any extension hereof, at Contractor's sole expense, insurance coverage written by companies approved by the State of Texas and acceptable to the City, in the following type(s) and amount(s): TYPE AMOUNT General Liability Commercial General Liability $200,000 General Aggregate Automotive Liability Combined Single Limit $200,000 Any Auto Workers Compensation Statutory Amounts The City of Lubbock shall be named additional insured on Auto/General Liability on a primary and non- contributory basis with a waiver of subrogation in favor of the City on all coverage's. All copies of the Certificates of Insurance shall reference the contract number for which the insurance is being supplied. Copies of endorsements are required. ADDITIONAL POLICY ENDORSEMENTS The City shall be entitled, upon request, and without expense, to receive copies of the policies and all endorsements thereto and may make any reasonable request for deletion, revision, or modification of particular policy terms, conditions, limitations, or exclusions (except where policy provisions are established by law or regulation binding upon either of the parties hereto or the underwriter of any of such policies). Upon such request by the City, the Contractor shall exercise reasonable efforts to accomplish such changes in policy coverages, and shall pay the cost thereof. REQUIRED PROVISIONS The Contractor agrees that with respect to the above required insurance, all insurance contracts and certificate(s) of insurance will contain and state, in writing, on the certificate or its attachment, the following required provisions: a. Name the City of Lubbock and its officers, employees, and elected representatives as additional insured, (as the interest of each insured may appear) as to all applicable coverage; b. Provide for 30 days notice to the City for cancellation, nonrenewal, or material change; c. Provide for notice to the City at the address shown below by registered mail; d. The Contractor agrees to waive subrogation against the City of Lubbock, its officers, employees, and elected representatives for injuries, including death, property damage, or any other loss to the extent same may be covered by the proceeds of insurance; e. Provide that all provisions of this contract concerning liability, duty, and standard of care together with the indemnification provision, shall be underwritten by contractual liability coverage sufficient to include such obligations within applicable policies. f. All copies of the Certificates of Insurance shall reference the contract number for which the insurance is being supplied. NOTICES The Contractor shall notify the City in the event of any change in coverage and shall give such notices not less than 30 days prior the change, which notice must be accompanied by a replacement CERTIFICATE OF INSURANCE. All notices shall be given to the City at the following address: Marta Alvarez, Director of Purchasing & Contract Management City of Lubbock 1625 13'h Street, Room 204 Lubbock, Texas 79401 SECTION D. Approval, disapproval, or failure to act by the City regarding any insurance supplied by the Contractor shall not relieve the Contractor of full responsibility or liability for damages and accidents as set forth in the contract documents. Neither shall the bankruptcy, insolvency, or denial of liability by the insurance company exonerate the Contractor from liability. Exhibit B February 24th, 2014 City of Lubbock 162513 Ih Street, #204 Lubbock, TX 79401 Subject: RFP 14 -11753 -MA Cattle Grazing on Hancock Land Site Dear Honorable Mayor and City Council PM Cattle, LLC hereby submits a response to the RFP #14 -11753 -MA pertaining to the cattle grazing on Hancock Land site. The enclosed response fully details how PM Cattle will comply with the requirements of this RFP and formally makes the following submissions for your consideration: • PM Cattle has ability to graze the maximum number of 600 (+/- 150 head) mature breeding age cows or replacement heifers. This is dependent on there being adequate forage to support such number. • PM Cattle has the financial ability to pay the grazing cost which is determined by multiplying PM Cattles monthly bid price per animal unit by the actual number of animal units grazed in respective month. • PM Cattle has the ability to stock cattle 450 head of cows within a minimum of 15 -days and 600 head of cattle within a maximum of 30 - days of being awarded this RFP. • PM Cattle will maintain adequate stocking levels to ensure full utilization of available forage while not overgrazing the site. PM Cattles Managing Partner lives within the area so there is adequate care for the cattle and the ownership of two semi -trucks and ground load cattle trailers provides the flexibility to transport and move cattle should the need arise. PM Cattle appreciates the opportunity to make this RFP submission for consideration before the Honorable Mayor of Lubbock and the Lubbock City Council. Regards, p Gary Md rniel,Managing Partner OPERATING_ OBJECTIVE & METHODOLOGY PM Cattle, LLC is a partnership formed by Gary McDaniel, Managing Partner and Wally Perez, General Partner. Partnership's operational objective is to utilize leased land or grazing rights to support and scale a growing cow/calf operation. The business model is based on developing long term relationships with Landowners with significant acreage that have the desire to lease land or grazing rights on a long-term basis to Cattlemen that have the reputation of performing in the following manner: • Good stewards of the land • Adhere to sound ranch management practices • Maintain a financial model that has long term sustainability The following are the operating principles that the Partners adhere to in the day to day cattle operations: • Think and Act as land owners • Think long term when investing • Utilize proven cattle ranching techniques and methods • Treat Land Owners as Partners and keep them informed The leasing of land and grazing rights allows PM Cattle to deploy its invested capital to fund the growth of its operations versus the acquisition of land. PM Cattle has been successful in generating a reasonable economic return that in turn is reinvested back into the partnership so that the need for debt is minimized. In addition, the leasing of grazing rights allows PM Cattle the ability to geographically diversify its operation's which allows the operations the Flexibility to scale its size based on current environmental and economic conditions. PARTNER BACKGROUNDS & EXPERTISE Gary McDaniel, Managing Partner Gary was born into a ranching family that ran a cattle operation in Wyoming. Gary maintains a personal residence in Southland, Texas where he and his wife own 1200 acres of farmland and also serves as his headquarters for his cattle operation in Garza and Lynn counties. Southland, Texas is 15 minutes from Wilson, Texas. Since coming to Texas, Gary has acquired 30+ years of experience in the cattle business as A cow/calf operator. In 2005, due to his reputation for being a competent and respected cattlemen, Gary acquired the grazing lease for 27 sections from the C.W. Post Estate. This became the base from which he was able to scale to a 900 head cow/calf operation. In 2013, due to the continuing drought in Texas, the headcount was decreased to its present levels. Prior to this downsizing, in 2011 and 2012 Gary leased land in Wyoming to provide grazing for 600 head of cows. Also, in 2013 Gary was successful in acquiring the grazing lease on acreage that is part of the Lake Allan Henry Wildlife Mitigation program. In addition to being a cattle rancher, Gary is currently serving his fourth term as a county commissioner in Garza County which equates to a total of 12 -years of service. Wally Perez, General Partner Wally is a native Texan and a graduate of Texas Tech University where he earned his BBA in Accounting. For the past 22 -years, Wally has maintained certifications as a Certified Public Accountant (CPA) and Certified Managerial Accountant (CMA). Wally has a residence in Lubbock and is currently employed as a Chief Financial Officer for a privately held company headquartered out of Dallas, Texas. Wally has 10+ years of experience running a cow/calf operation in East Texas which is headquartered out of Italy, Texas. The operation started in 2005 as a hobby with 20 head of cows and through the acquisition of lease land scaled to a 950 head operation in just 3 -years. Due to the continuing drought in Texas, the cattle operation was scaled down to its present size of 750 momma cows. SIZE OF OPERATION PM Cattle, LLC operates 28,000 acres of leased land/grazing in West Texas and East Texas. The West Texas operation currently maintains 400 head of cows/ replacements on the following leased acreage: CW Post Estate consists of 27 -sections in Garza and Lynn County. During normal periods of rainfall acreage will support 600 head of momma cows. Lake Allan Henry Wildlife Mitigation consists of 6 -Sections. During normal periods of rainfall acreage supports 100 head of momma cows. The East Texas operation currently maintains 750 head of cows/replacements on the following leased acreage: Ellis County consists of 1,200 acres. • Van Zandt County consists of 4,500 acres. • Wood County consists of 1,200 acres. PM Cattle owns two semi -trucks and two 53 foot ground load cattle trailers. This provides the flexibility to move cattle between the East and West Texas operations when lack of rainfall affects the available grazing in a geographical area. PARTNER INVOLVEMENT IN CATTLE OPERATIONS Gary McDaniel, Managing Partner oversees the West Texas operations headquartered out of Southland, Texas. The headquarters is 15 -minutes from Wilson, Texas. Gary and his son Clint McDaniel will spend 3-4 days per week overseeing the cattle that will be grazed on the Hancock Land Site. Wally Perez, General Partner oversees the East Texas operations headquartered out of Italy, Texas and will be involved 2 -weekends per month overseeing the cattle that will be grazed on the Hancock Land Site. F INVOLVEMENT FROM OTHER RESOURCES PM Cattle's intentions are not to hire other professionals at this point to assist with the cattle that will be grazed on the Hancock Land Site. J ORGANIZATIONAL STRUCTURE OF PM CATTLE, LLC West Texas Operations Gary McDaniel, Manager Clint McDaniel, Cowboy (10+ years cattle experience) East Texas Operations Wally Perez, Manager Matt Petrey, Foreman (20+ years of cattle experience) COMPLIANCE WITH FEDERAL, STATE AND LOCAL LAWS PM Cattle, LLC hereby acknowledges that it has complied and will continue to comply with all Federal, State and Local laws. HANDLING AND MANAGING ERRORS AND OMMISSIONS PM Cattle, LLC business model is based on developing and maintaining long term Partnership's with Land Owners. So should an error or an omission occur as a result of being awarded this RFP, our philosophy for handling these type of matters is to approach this from a Land Owners perspective and through the course of discussions formulate options that can serve as a solution that is mutually beneficial for all parties. I CITY OF LUBBOCK, TEXAS Cattle Grazing on Hancock Land Site RFP 14 -11753 -NIA PRICE SHEET ITEM UNIT OF MEASURE DESCRIPTION Contractor shall pay to the City S 0 per Animal Unit per Month (each dry 1. Animal =22. cow, bull, cow/nursing calf, and/or weaned calf as deemed to be an "Animal Unit"). • Successful Contractor will have the HLAS stocked within how many days: 6,re a cmt) after contract is awarded? • Location of where the majority of the business is accomplished: L. W34 o CA-, 0 AA Z A -P &AI M d tom.. ti r / E$ �v7'f PM CAii LC HAS THL oA/3CC* -/o Srose *ySaEfeA� �� Ca�.►� /$= N A y T ANN (;C/6 H£.a6 w a r ba i.,1 A Cir 30 — k lays 6 r A4 Aw aid9 Co 17--1S 2 l=N Contractor's Signature Company's Name ?M C& rc F LL[' 14 Exhibit C INSURANCE SECTION A. Prior to the approval of this contract by the City, the Contractor shall furnish a completed Insurance Certificate to the City, which shall be completed by an agent authorized to bind the named underwriter(s) to the coverages, limits, and termination provisions shown thereon, and which shall furnish and contain all required information referenced or indicated thereon. THE CITY SHALL HAVE NO DUTY TO PAY OR PERFORM UNDER THIS CONTRACT UNTIL SUCH CERTIFICATE(S) HAVE BEEN DELIVERED TO THE CITY. INSURANCE COVERAGE REQUIRED SECTION B. The City reserves the right to review the insurance requirements of this section during the effective period of the contract and to require adjustment of insurance coverages and their limits when deemed necessary and prudent by the City based upon changes in statutory law, court decisions, or the claims history of the industry as well as the Contractor. SECTION C. Subject to the Contractor's right to maintain reasonable deductibles in such amounts as are approved by the City, the Contractor shall obtain and maintain in fill force and effect for the duration of this contract, and any extension hereof, at Contractor's sole expense, insurance coverage written by companies approved by the State of Texas and acceptable to the City, in the following type(s) and amount(s): TYPE AMOUNT General Liability Commercial General Liability $200,000 General Aggregate Automotive Liability Combined Single Limit $200,000 Any Auto Workers Compensation Statutory Amounts The City of Lubbock shall be named additional insured on Auto/General Liability on a primary and non- contributory basis with a waiver of subrogation in favor of the City on all coverage's. All copies of the Certificates of Insurance shall reference the contract number for which the insurance is being supplied. Copies of endorsements are required. ADDITIONAL POLICY ENDORSEMENTS The City shall be entitled, upon request, and without expense, to receive copies of the policies and all endorsements thereto and may make any reasonable request for deletion, revision, or modification of particular policy terms, conditions, limitations, or exclusions (except where policy provisions are established by law or regulation binding upon either of the parties hereto or the underwriter of any of such policies). Upon such request by the City, the Contractor shall exercise reasonable efforts to accomplish such changes in policy coverages, and shall pay the cost thereof. REQUIRED PROVISIONS The Contractor agrees that with respect to the above required insurance, all insurance contracts and certificate(s) of insurance will contain and state, in writing, on the certificate or its attachment, the following required provisions: a. Name the City of Lubbock and its officers, employees, and elected representatives as additional insured, (as the interest of each insured may appear) as to all applicable coverage; b. Provide for 30 days notice to the City for cancellation, nonrenewal, or material change; c. Provide for notice to the City at the address shown below by registered mail; d. The Contractor agrees to waive subrogation against the City of Lubbock, its officers, employees, and elected representatives for injuries, including death, property damage, or any other loss to the extent same may be covered by the proceeds of insurance; e. Provide that all provisions of this contract concerning liability, duty, and standard of care together with the indemnification provision, shall be underwritten by contractual liability coverage sufficient to include such obligations within applicable policies. f. All copies of the Certificates of Insurance shall reference the contract number for which the insurance is being supplied. NOTICES The Contractor shall notify the City in the event of any change in coverage and shall give such notices not less than 30 days prior the change, which notice must be accompanied by a replacement CERTIFICATE OF INSURANCE. All notices shall be given to the City at the following address: Marta Alvarez, Director of Purchasing & Contract Management City of Lubbock 1625 13`" Street, Room 204 Lubbock, Texas 79401 SECTION D. Approval, disapproval, or failure to act by the City regarding any insurance supplied by the Contractor shall not relieve the Contractor of full responsibility or liability for damages and accidents as set forth in the contract documents. Neither shall the bankruptcy, insolvency, or denial of liability by the insurance company exonerate the Contractor from liability.