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08/21/2014 Audit 'CIEg ,,,, # 4 .<f� 5 1" F .a 3.m i' J�/�p�F T `t; • -�. t, r,/ w ik &n AyCLERK OF CIRCUIT COURT & COMPTROLLER \ t � � ,��� MONROE COUNTY,FLORIDA ooti, FLORI.DI' August 28, 2014 The Honorable Amy Heavilin, CPA Clerk of the Circuit Court & Comptroller Re: Audit Report of the Monroe County Agreement for Misdemeanant Probation Services with Court Options, Inc. Dear Mrs. Heavilin, The Clerk's Internal Audit Department has completed an audit of the Monroe County Agreement for Misdemeanant Probation Services with Court Options, Inc. The audit objectives were to assess compliance with the financial reporting requirements of the Agreement for Services. This audit was conducted with the assistance of Trisha Schroff, Internal Auditor. The accompanying audit report is provided for your information. Additional copies of the report will be provided upon your request. Sincerely, (2 ''CLA- 3.aAe.,(t(le_.0_02M Pamela Limbert Sellers, CFE Director of Internal Audit Cc: Board of County Commissioners (5) Holly Elomina, Court Administrator Honorable Judge Luis Garcia, Chief Judge Amanda Cochran, Clerk's Finance Director Bob Shillinger, County Attorney 500 Whitehead Street Suite 101,PO Box 1980,Key West,FL 33040 Phone:305-295-3130 Fax:305-295-3663 3117 Overseas Highway,Marathon,FL 33050 Phone:305-289-6027 Fax:305-289-6025 88820 Overseas Highway,Plantation Key,FL 33070 Phone:852-7145 Fax:305-852-7146 AUDIT REPORT OF THE MONROE COUNTY AGREEMENT FOR MISDEMEANANT PROBATION SERVICES WITH COURT OPTIONS, INC. August 21, 2014 4c..„,\i --.2"-\ tir7":• , .--- . I)/IIf / io ,., -: -- -r-. 3 vo 7-- ),\ .- - e, ..,-,7,-1 ., „---_,,- ,„ \.„7...„, ,aiii .4,,,,,.:t. tag , © . Prepared by: Internal Audit Department Clerk of the Circuit Court and Comptroller Amy Heavilin, CPA, CFE Monroe County, Florida AUDIT REPORT OF THE MONROE COUNTY AGREEMENT FOR MISDEMEANANT PROBATION SERVICES WITH COURT OPTIONS, INC. TABLE OF CONTENTS Page I. OBJECTIVES 1 II. SCOPE 1 III. METHODOLOGY 1-2 IV. BACKGROUND INFORMATION 2-3 V. OVERALL CONCLUSIONS 4 VI. AUDIT FINDINGS 1. Contractually required documentation/reports are not being submitted by Court Options. 4-7 2. Payments received from Probationers are being held in non-escrow bank accounts and funds are being comingled. 3. Court Options did not remit Court fees and fines payments from Probationers to the Clerk of the Court in a timely manner. 8 4. Court Options did not distribute restitution payments to the Victims in a timely manner. 9 5. There is a large amount of restitution and refunded court fees in Court Options' possession that needs to be distributed to the Victims or Probationers. As well as outstanding and stale checks that need to be voided, reissued or otherwise resolved. 10-11 VII. EXHIBITS 1. Agreement for Probation Services between Monroe County and Court Options, Inc. dated 07/18/2007. 2. First Amendment to the Agreement for Probation Services between Monroe County and Court Options, Inc. dated 05/19/2010. 3. Agreement to Exercise Option to Extend Agreement for Probation Services between Monroe County and Court Options, Inc. dated 05/19/2010. 4. Court Options' Independent Auditor's Report on Audited Financial Statements for years January 1, 2009 through December 31, 2012. 5. Court Options' Independent Auditor's Report on Audited Financial Statements for year ended December 31,2013. 6. Court Options Inc.'s Audit Responses. AUDIT REPORT OF MONROE COUNTY AGREEMENT FOR MISDEMEANANT PROBATION SERVICES WITH COURT OPTIONS, INC. Prior to the completion of this audit. the Agreement for Misdemeanant Probation Services with Court Options has expired and the contract has been awarded to a new provider. Contract negotiations are in progress. I. OBJECTIVES: At the request of the Monroe County Clerk of the Circuit Court, the Internal Audit Department has completed an audit of the compliance to the Agreement for Probation Services provided by Court Options, Inc. (Court Options) in relation to financial reporting. The objective was to determine if Court Options was in compliance with the financial reporting requirements of the Agreement for Services. II. SCOPE: A review of Court Options, Inc.'s bank reconciliations, methods of accounting and reporting fines and court cost information to the Court was performed for the period of January 1, 2010 through May 31, 2013. III. METHODOLOGY: During the audit, the following personnel were interviewed to obtain information about the Policies and Procedures used in Supervision Services: • Ruben Valdivia,President, Court Options, Inc. • George Romagosa,Vice President, Court Options, Inc. • Lydia Losas Controller, Court Options, Inc. • Court Options, Inc. Personnel • Holly Elomina, Court Administrator • Clerk's Traffic/Misdemeanor Personnel • Clerk's IT Staff • Clerk's Director Of Administrative Services • Assistant County Attorney The Internal Audit Department examined the following documents: • Executed copy of the service agreement between Monroe County and Court Options, Inc. • Official County Records and supporting documentation. • Copies of Court Options, Inc.'s bank statements and reconciliations. • Copies of Court Options, Inc.'s receipts, cancelled checks. • General Ledgers from Court Options, Inc.'s accounting system. • Spreadsheets provided by Court Options of all probationer receipts from January 2010 to May 31, 2013. 1 • Court Options' Outstanding External Fees Report. • Court Options, Inc.'s Financial Statements. • Florida Statute 948.15 -Misdemeanor Probation Services The Internal Audit Department reviewed Court Options' bank statements for collections and traced them to monthly Monroe County receipts reports. IV. BACKGROUND INFORMATION Monroe County sought the services of a private entity to provide misdemeanor probation services pursuant to Section 948.15(2) of the Florida Statutes. The Monroe County Board of County Commissioners (BOCC) entered into an agreement for misdemeanor probation services between Monroe County and Court Options, Inc. The contract appoints Court Options per Section 948.15 F.S. as the entity to provide certain probation services for the efficient administration of justice in Monroe County. Probation services include the collection of court imposed fines and fees and restitution. Court Options subsequently remits the fines and fees to the Clerk of the Court and the restitution to the victims. Court Options is entitled to collect from each probationer costs of supervision. Under this agreement, Court Options derives its funding by charging probationers a fee of$50 per month for its services. On July 18, 2007 the Monroe County Board of County Commissioners executed an agreement for a three (3) year period commencing August 1, 2007 through July 31, 2010. On May 19, 2010 the Agreement was amended to allow for two (2) succeeding periods of two (2) years each for renewal. Please see Exhibit#1-3. In addition to other services applicable to the contract, Court Options agrees to provide the following services to the Court: • Monitor, collect, follow up and enforce special conditions of probation, including, but not limited to: Restitution, Fines and Court costs, Evaluation and treatment programs, Community services, Cost of supervision fees, Procurement of licenses and Pretrial Services,Job assistance, Supervision and Electronic Monitoring. • Court Options shall place priority on supervision of the payment of restitution to probationers' victim(s). Waivers by the COURT of any special condition of probation shall be noted in the case file. • Clear all employees prior to hiring through a criminal background records check, as required by State statute. • Provide to the Administrative County Judge and the COUNTY an annual report, and other statistical reports as are required by the Court or law. 2 • Provide weekly reports to the Court of collections made and remittances to Court. All collected fine and cost payments shall be remitted on a weekly basis to the Clerk of Court. • Submit a weekly statement to the Court or its representative for the amount of Court fines, costs and restitution ordered by the Court and collected by Court Options from the probationers. This report shall provide to the Court collection data by area of the Florida Keys. • Tender all fines, costs and restitution ordered by the Court and collected by Court Options. Payments shall be applied first to Restitution. • Maintain fine, restitution and/or court costs collected from the probationers in an escrow account without the benefit or profit from said accounts. • Maintain financial records capable of being audited of all fines, restitution and supervision fees received, expended and disbursed. • Provide to the County Clerk and Court Administrator or his designee, an annual financial report audited and certified by a licensed Certified Public Accountant within one hundred twenty (120) days following the close of Court Option's fiscal year. The certified financial report shall be in such detail as to disclose the revenues, expenses, and disbursements relating to the services provided under this Agreement. Notes to financial statements shall disclose noncompliance with requirements of this Agreement concerning conflict of interests. • Record and maintain statistical data concerning the number and types of cases being handled, terminated and completed, number of visits, hours of community service performed by probationers, and such additional information as may be required by the Administrative County Judge, the Court Administrator, or the County. A quarterly report shall be submitted to the Court Administrator and to the Administrative County Judge. • Provide to the Court Administrator and the County a copy of Court Option's fiscal budget each year within thirty (30) days of the beginning of its fiscal year. • Retain records pertaining to this Agreement for a period of five (5) years after the termination of the Agreement. • In providing all services pursuant to this Agreement, Court Options shall abide by all statutes, ordinances, rules and regulations pertaining to, or regulating the provisions of, such services, including those now in effect and hereinafter adopted. Any violation of said statutes, ordinances, rules and regulations shall constitute a material breach of the Agreement and shall entitle the Board to terminate this Agreement immediately upon delivery of written notice of termination to Court Options. 3 V. OVERALL CONCLUSIONS: The Provider, Court Options, did not provide crucial information/documentation required by the Agreement to the Parties specified in the Agreement. Court Options did not remit costs, fines and fees to the Clerk of Court in a timely manner. Court Options did not remit restitution to the Victims in a timely manner. Court Options is holding a substantial amount of Restitution and Refunded Court Fees as the result of"Stale" checks. The County should monitor more frequently the contract and enforce adherence to agreement provisions. VI. AUDIT FINDINGS FINDING: 1. Contractually required documentation/reports are not being submitted by Court Options. Court Options is not submitting to the Court, the Court Administrator, the Administrative County Judge and the Clerk of Court contractually required documentation necessary to verify that the standards for services and financial accountability of this agreement are being met. The Agreement for Probation Services between Monroe County and Court Options, Inc. states the following conditions to establish minimum standards for misdemeanor probation and criminal justice services and financial accountability. "3.4.2 The CONTRACT!OR shall provide weekly reports to the Court of collections made and remittances to Court. All collected fine and cost payments shall be remitted on a weekly basis to the Clerk of Court."Please see Exhibit#1 Court Options is not providing the required weekly reports to the Court. The only "report" being provided is a breakdown of fees, fines and costs contained in the bank wire transfer of funds to the Clerk. This information was provided to the Clerk by electronic mail accompanying the wire of incoming funds from Court Options. "3.4.6 The CONTRACT'OR shall submit a weekly statement to the Court or its representative for the amount of Court fines, costs and restitution ordered by the Court and collected by the CONTRA.0 T!OR from the Probationers. This report shall provide to the Court collection data by area of the Florida Keys." Please see Exhibit#1 Court Options is not providing the required weekly statement to the Court for the amount of Court fines, costs and restitution ordered by the Court and collected by Court Options from the Probationers. 4 "3.11.1 No later than the execution of this AGREEMENT, the CONTRACT'OR shall submit to the Court Administrator, or his designee, a list of the names of all probation employees, including those of any subcontractors or independent Contractors, if any, to be used by the CONTRACTOR in providing the services under this AGREEMENT. This list shall include the education levels and job titles of the employees, subcontractors and independent Contractors. This list shall be updated at least annually, upon the anniversary of the date of this AGREEMENT... " Please see Exhibit#1 Court Options did not provide this information to the Court Administrator at any time during the contract period. "3.12.1 The CONTRACT!OR shall maintain financial records capable of being audited of all fines, restitution, and supervision fees received, expended and disbursed by the CONTRACT'OR. An annual financial report audited and certified by a licensed Certified Public Accountant shall be provided to the County Clerk and to the Court Administrator or his designee within one hundred twenty (120) days following the close of the CONTRACTOR'S fiscal year. The certified financial report shall be in such detail as to disclose the revenues, expenses, and disbursements relating to the services provided under this AGREEMENT. Notes to the financial statements shall disclose noncompliance with requirements of this AGREEMENT concerning conflict of interests." Please see Exhibit#1 Court Options did not provide to the County Clerk and/or the Court Administrator an annual financial report audited and certified by a licensed Certified Public Accountant for the years 2009 through 2012 within one hundred twenty (120) days following the close of the fiscal year. At the onset of this audit, Internal Audit requested the audited financial statements. Court Options stated that the 2009 through 2012 financials were in the process of being audited. On October 31, 2013, Court Options provided to Internal Audit the financial audits for the years 2009, 2010, 2011, 2012. Please see Exhibit#4 The audit for 2013 was received on April 30, 2014. Please see Exhibit#5 "3.12.2 The CONTRACT OR shall also record and maintain statistical data concerning the number and types of cases being handled, terminated and completed, number of visits, hours of community service performed by probationers, and such additional information as may be required by the Administrative County Judge, the Court Administrator, or the County. A quarterly report shall be submitted to the Court Administrator and to the Administrative County Judge." Please see Exhibit#1 Court Options did not submit to the Court Administrator or the Administrative County Judge, statistical data concerning the probationers prior to the commencement of this audit. On June 13, 2013, Court Options provided to Internal Audit statistical data for the years 2010, 2011, 2012 and the first quarter of 2013. 5 "3.12.3 The CONTRACTOR shall provide to the Court Administrator and the County a copy of the CONTRACTOR'S fiscal budget each year within thirty (30) days of the beginning of its fiscalyear." Please see Exhibit#1 Court Options did not provide to the Court Administrator, a copy of Court Options' annual fiscal budget for the years 2008, 2010, 2011 and 2012. The Court Administrator received a copy of Court Options' 2009 fiscal budget. Court Options did not provide to the County, a copy of Court Options' annual fiscal budget for the years 2008, 2009, 2010, 2011 and 2012. "4.5 A written document detailing procedures for handling collection of probationers' fees and restitution will be provided by the CONTRACT OR to the Administrative County Judge no later than five (5) days following the approval by the Board of County Commissioners of this AGREEMENT" Please see Exhibit#1 Court Options did not provide to the Administrative County Judge, a copy of Court Options'Policy and Procedures as required by the Agreement. This Agreement's required documentation was not being provided and the agreement was not being properly monitored or enforced by any responsible parties on behalf of Monroe County or any of the parties listed in the agreement. Recommendation(s): 1. Court Options should remit the required documentation to the appropriate parties immediately. 2. This Agreement needs to be assigned to a responsible party or parties to monitor and enforce the provisions of the agreement. 3. Court Options should supply the Clerk of Courts with a report detailing monetary sums ordered by the Court and owed by the Probationer for all new Probationers and all existing Probationers. Court Options' Response: Please see the Exhibit#6 Auditor Comments: In reference to the finding concerning Section "3.4.2 The CONTRAC;1 OR shall provide weekly reports to the Court of collections made and remittances to Court. All collected fine and cost payments shall be remitted on a weekly basis to the Clerk of Court" of the Contract. The finding states "Court Options is not providing the required weekly reports to the Court. The "Court" is an intended recipient not just the "Clerk of Court." They are two separate parties. Reports were not provided to the"Court." 6 In reference to the finding concerning Section 3.12.1, it is stated in the audit report "Court Options did not provide to the County Clerk and/or the Court Administrator an annual financial report audited and certified by a licensed Certified Public Accountant for the years 2009 through 2012 within one hundred twenty (120) days following the close of the fiscal year." Court Options states in their audit response "those audits did not yield any adverse or qualified opinions from our auditors." This is a misstatement of fact. The Independent Auditor's Report (Sharma & Associates, Inc.) for both the year ending December 31, 2012 and the ending December 31, 2013 clearly state a "Qualified Opinion" and "Basis for Qualified Opinion". (Please see Exhibit#4 and Exhibit#5) FINDING: 2. Payments received from Probationers are being held in non-escrow bank accounts and funds are being comingled. Although none of the bank accounts used to maintain fine, restitution and/or court costs collected from Probationers accrued interest, the accounts were not titled as "Escrow" accounts as required by the Agreement. All of the bank accounts used are checking accounts. The main depository account, which accepted all funds remitted by Probationers, was also used as a checking account, making disbursements for operating expenses such as payroll, banking fees, and credit card merchant fees. The comingling of funds is an inappropriate business practice for collection of funds which do not belong to the entity. These funds include restitution which is transferred to another checking account that should be tided as an "escrow" account. Recommendation(s): 1. All bank accounts receiving Probationer fees should be converted to Escrow Accounts and titled as such. 2. These depository accounts should not be used as operating accounts incurring fees and paying expenses of the business. 3. The funds received from Probationers should not be comingled with any other funds. Supervision fee income received should be transferred to a separate Court Options bank account to use as operating funds. Court Options' Response: Please see the Exhibit#6 7 FINDING: 3. Court Options did not remit Court fees and fines payments from Probationers to the Clerk of Court in a timely manner. The Agreement for Probation Services between Monroe County and Court Options, Inc. states the following: "4.3 ...CONTRAC,"1 OR shall make all payments of fines and Court costs to the Clerk of Court within five (5) working days following rece pt..." Internal Audit sampled six (6) different months of payments from Court Options and calculated the average number of days from when Court Options collected payment from a Probationer until that payment was wired to the Clerk of Court. The average number of days for a payment to be wired to the Clerk of Court was seven (7) working days. This is not in compliance with the Agreement which states five (5) working days. Eighteen (18) of the thirty (30) payments sampled (60%) were not wired within five (5) working days following receipt. In addition, Court Options said in their response to Monroe County's Request for Qualifications that they would deposit funds into the Court Options bank account daily. Bank deposits were not made daily as stated in Court Options' Procedures. The auditors observed that Court Options separates each month into weekly periods consisting of one (1) to five (5) days. At the end of each weekly period, Court Options makes a deposit for cash, check and money orders collected during that period. Recommendation(s): 1. Court Options should promptly deposit daily all receipts in order to make sure remittances to the Clerk of the Court are not delayed, and to avoid any possibility of theft. 2. Court Options should adhere to the Accounting and Bookkeeping Procedures that they submitted to the Monroe County Board of Commissioners per the agreement. Court Options' Response: Please see the Exhibit#6 8 FINDING: 4. Court Options did not distribute restitution payments to the Victims in a timely manner. The Agreement for Probation Services between Monroe County and Court Options, Inc. states the following: "4.3 ...CONTRACT OR shall make all restitution payments to the victim promptly following receipt..." Internal Audit sampled four (4) different months of restitution remittances from Probationers to Court Options. The auditor calculated the average number of days from when Court Options collected payment from a Probationer until the restitution check was issued to the Victim. The average number of days for a restitution check to be issued to the Victim was sixty-five (65) working days. This is not in compliance with the intended purpose of the Agreement for Probation Services. Forty-three percent (43%) of the one hundred fifty-eight (158) payments by Probationers were issued more than thirty (30) days after the payment was received. During the audit, it was discovered that there were restitution payments remitted to Court Options which had not been distributed to Victims according to Court Options' disbursement report ending May 2013. In December 2012, three (3) separate payments from different Probationers totaling $220.00 did not have a restitution check issued to the Victim. In May 2013, fourteen (14) payments from Probationers totaling $2,232.86 did not have a restitution check issued to the Victim. There were fourteen (14) instances during the test months when Court Options combined multiple restitution payments and then issued a check to the Victim. In these instances, Court Options withheld these combined restitution payments for varying periods between two (2) and three hundred and eight (308) working days. Internal Audit observed discrepancies in Court Options' External Disbursement Report that lists issued restitution checks. There were sixteen (16) instances when Court Options duplicated a check number during the years 2010, 2011, 2012 and 2013. The Auditors were unable to reconcile these check numbers. Recommendation(s): 1. Court Options should abide by the Agreement for Probation Services and issue restitution payments to the victim promptly following receipt. 2. The term"promptly" should be more specified in future Agreements. Court Options' Response: Please see the Exhibit#6 9 FINDING: 5. There is a large amount of restitution and refunded court fees in Court Options possession that needs to be distributed to the Victims or Probationers. As well as outstanding and stale checks that need to be voided, reissued or otherwise resolved. As of the May 31, 2013 bank statement, there were two hundred sixty-two (262) outstanding checks totaling $44,548.04. Two hundred thirty-seven (237) are stale checks totaling $32,860.67. The stale checks are dated from January 30, 2008 to November 30, 2012. Twenty-five checks totaling$11,687.37 are outstanding but not yet stale. The stale checks consist of restitution owed to Victims and refunds owed to Probationers and should be voided, reissued or otherwise resolved. The tables below summarize the stale and outstanding checks Court Options issued for Restitution and Refunded Court Fees. Stale Checks Year Check was # of Outstanding Amount of Amount of Issued Checks Refunded Court Restitution to Fees to Victims Probationer 2008 63 $4,882.99 $3,596.39 2009 64 $4,151.67 $1,668.98 2010 70 $ 6,453.35 $1,321.92 2011 23 $ 874.00 $2,086.85 2012 17 $ 92.73 $7,731.79 Total 237 $16,454.74 $16,405.93 TOTAL STALE CHECKS $32,860.67 Outstanding Checks Not Yet Stale Year Check was #of Outstanding Amount of Amount of Issued Checks Refunded Court Restitution to Fees to Victims Probationers 2012 Restitution 4 $ 238.55 $100.00 2013 Restitution 21 $ 503.00 $10,845.82 Total 25 $741.55 $10,945.82 TOTAL OUTSTANDING BUT NOT YET STALE CHECKS $11,687.37 10 The Federal Deposit Insurance Corporation (FDIC) states the following regarding stale checks: `F. 229.13(e) Reasonable Cause To Doubt Collectability c. The fact that a check is deposited more than six months after the date on the check (i.e. a stale check) is a reasonable indication that the check may be uncollectible, because under U.S.C. 4--404 a bank has no duty to its customer to pay a check that is more than six months old... " The Agreement for Probation Services between Monroe County and Court Options, Inc. states the following: "4.3 ...CONTRACT OR shall make all restitution payments to the victim promptly following receipt...In any case in which the victim cannot be located or in which less than the full amount of the fine and costs are collected, the CON RAC1 OR shall request that the sentencing Court instruct the CONTRACT'OR as to proper disposition." Court Options explained that many of the checks written to the victims for restitution were returned without a forwarding address or were not cashed. Recommendation(s): 1. Court Options should resolve and reissue outstanding checks on a timely basis. 2. In any case in which the Victim or Probationer cannot be located, Court Options should request from the sentencing Court, instructions as to proper disposition of the restitution and/or refunded fees. 3. Appropriate authorities should decide when unclaimed restitution payments and refunded fees should be processed as abandoned property. Court Options' Response: Please see the Exhibit#6 11 VII . EXHIBITS Exhibit # 1 Agreement for Probation Services between Monroe County àndCourt Options, Inc: dated 07/ 18/2007 AGREEMENT FOR PROBATION SERVICES BETWEEN MONROE COUNTY AND COURT OPTIONS, INC. THIS AGREEMENT, made and entered into this / day of I , 2007, A.D., by and between MONROE COUNTY, FLORIDA, (hereinafter fm:'mes called the"COUNTY"), and COURT OPTIONS, INC.; a Florida corporation, (hereinafter called the"CONTRACTOR"). WHEREAS, certain misdemeanor defendants are placed on probation by the County Court (COURT) of the Sixteenth Judicial Circuit, Monroe County; and WHEREAS, Section 948.15(2), Florida Statutes, allows for a private entity under AGREEMENT with the COUNTY to provide probation services;and WHEREAS,the COURT utilizes private entities to provide certain misdemeanor . probation and criminal justice services for the efficient administration of justice in Monroe County; and - WHEREAS, the COURT desires to continue to utilize the probation and criminal justice services of.a private agency under an agreement which establishes minimum standards for service and financial accountability; and NOW THEREFORE, in consideration of the mutual covenants and provisions contained herein,the parties agree as follows: That the parties hereto, for the consideration hereinafter set forth, mutually agree as follow: 1. THE AGREEMENT The AGREEMENT between the COUNTY shall be the entire Agreement between the parties. 2. TERM OF AGREEMENT The term of this AGREEMENT is for Three(3)years, commencing on the 151 day of August, 2007, and ending on the 31, day of July,2010. County, with the consent of the Chief Judge of the Court, has the option of renewing this AGREEMENT for four succeeding periods of(1) one-year each. COUNTY shall provide CONTRACTOR at least thirty (30) days notice of its intent to renew. 3. SCOPE OF THE WORK The CONTRACTOR shall provide misdemeanor probation services for the 16th Judicial Circuit, and shall include supervision, rehabilitation, and probation. The CONTRACTOR may also provide pre-trial diversion services at no additional cost to the COUNTY and charged exclusively to the participants in the program. The CONTRACTOR warrants that it is authorized by law to engage in the performance of the activities herein described, subject to the terms and conditions set forth in these AGREEMENT documents. The provider shall at all times exercise independent,professional judgment and shall assume professional responsibility for the services to be provided. CONTRACTOR shall provide services to the degree permitted by law and ordered by the Court and using the following standards, as a minimum requirement: 3.1 Monitor Special Conditions CONTRACTOR shall monitor compliance with conditions placed on referred cases as directed by the Court. The CONTRACTOR shall monitor, collect, follow up and enforce special conditions of probation, including,but not limited to: (i) Restitution - (ii) Fines and Court costs (iii) Evaluation and treatment programs (iv) Community services (v) Cost of supervision fees (vi) Procurement of licenses (vii) Pre-Trial Services The CONTRACTOR shall place priority on payment of restitution. Waivers by the sentencing Court of any special condition of probation shall be noted in the case file. 3.2 Staffing 3.2.1 The CONTRACTOR shall maintain adequate staffing levels to: (i)attend Court when specifically requested by the Court, (ii) provide proper liaison with the sentencing.Court, (iii)perform the initial intake of persons placed on misdemeanor probation with the CONTRACTOR, (iv) properly supervise persons placed on misdemeanor probation with the CONTRACTOR, (v) appear at all Court hearings involving a probationer supervised by the CONTRACTOR, (vi) supervise all probationers of the COURT, (vii) maintain records and reporting requirements set by law and by this Agreement, and (viii)provide oversight of any offender placed on pre-trial diversion. (ix) collect, record, report, and distribute all payments as required under this Agreement. 3.2.2 CONTRACTOR shall staff each area with personnel who are fluent in English and trained in courtroom decorum, who have experience in providing testimony in court, who are available to testify,who have knowledge of the probationer and file about which they are called to testify. pa�.7r�/P _ s - - 3.2.3 Each area shall be staffed at all times during regular hours and flexible hours with personnel who are fluent in Spanish and fluent in English to ensure that probationers will be supervised in the language understandable to the probationer. It is not a requirement that staff members be bilingual, it is acceptable to have an English speaker and a Spanish speaker available. The CONTRACTOR shall have, either on staff or on an on-call basis, interpreters fluent in other foreign languages to assist the probationer(s)in understanding and meeting the terms of their probation. 3.2.4 The CONTRACTOR shall have, either on staff or on-call, interpreters to assist the probationer(s) in understanding and meeting the terms of probation pursuant to provisions of the Americans with Disabilities Act. 3.2.5 Staff shall provide Face-to-Face contact, at a minimum, at the outset of supervision and prior to final report to the Court regarding compliance with the order of probation.Additional Face to Face contacts shall be conducted as may be deemed necessary or beneficial to the successful completion of probation or as- required by the Court. All Face to Face contacts and any non-Face to Face • contacts shall be recorded in the probations file. 3.2,6 The CONTRACTOR shall employ professional probation personnel that meet or exceed current standards required by the American Correctional • - Association. In exigent circumstances,individual_exceptions will be permitted based solely on approval of the individual by the majority vote of all the sitting COUNTY COURT judges and solely within the judges' discretion. The vote shall be based on experience and knowledge of the individual and on information given to the judges by CONTRACTOR prior to the vote. 3.2,7 The CONTRACTOR shall clear all employees prior to hiring through a criminal background records check, as required by State statute. A record of the background check shall be kept in the personnel file of each employ. 3.3 Programs & Services • 3.3.1 The needs of each probationer referred to the CONTRACTOR by the sentencing Court shall be evaluated by the CONTRACTOR. The. CONTRACTOR shall determine if said probationer requires other services in addition to those ordered by the sentencing Court and shall use its best efforts to direct the probationer to an appropriate program. Contractor will make recommendations to the Court and get Court approval for additional services. Records of referrals to such programs and progress reports shall be included in the case file. 3.3.2 The CONTRACTOR shall cooperate with all treatment agencies, schools and other programs to which offenders are referred. In any case where a treatment provider, school or other program does not appear to be providing its 'W sit le proper function, the CONTRACTOR shall immediately notify the sentencing Court. 3.3.3 The CONTRACTOR shall provide to the Administrative County Judge and the COUNTY an annual report, and other statistical reports as are required by the Court or law. 3.3.4 Any new programs proposed by the CONTRACTOR to be utilized by people placed on probation in Monroe County shall be disclosed to the COURT prior to implementation and shall be subject to review and approval of the COURT. 3.3.5 The CONTRACTOR shall provide electronic monitoring services as ordered by the Court, with the expenses to be borne by the probationer. The description of the electronic monitoring services,the responsibilities of the CONTRACTOR and the COURT, as well as the notification for alerts are described in Exhibit A. 3.3.6 The CONTRACTOR shall provide program services to Probationers when ordered by the Court. The pricing and description of the Programs offered are attached as Exhibit B. 3.3.7 The CONTRACTOR shall provide random drug testing as ordered by the Court, with the expense born by the probationer. 3.3.8 The CONTRACTOR shall comply with all laws regarding confidentiality of Probationers records. 3.4 Probationer Records,Reporting. Filing, and Court Appearances 3.4.1 The CONTRACTOR shall maintain a separate file containing information on each probationer referred to the program. Records shall be maintained by the CONTRACTOR for a period of five (5) years from expiration of the probationary term. The information in the file shall include the name of the probationer,case number, charge(s),probation disposition, automated house arrest records, correspondence, payment records, and any known prior criminal record. Should this Agreement be terminated for any reason,a complete copy of the probationer's file shall be turned over to the COUNTY or it's designee within ten (10) days of termination. 3.4.2 The CONTRACTOR shall provide'weekly reports to the Court of collections made and remittances to Court. All collected fine and cost payments shall be remitted on a weekly basis to the Clerk of Court. 3.4.3 The CONTRACTOR shall report to the Court any and all violations of court ordered conditions for any probationer who is materially in violation of such ;oar � �/�' - . conditions. The CONTRACTOR shall make recommendations for revocation of. probation when the probationer has been arrested or a warrant issued for the probationer's_arrest and when multiple probation violations have occurred. 3.4.4 The CONTRACTOR shall file petitions,warrants,orders or other pertinent documentation as ordered by the COURT related to the probationer or related to hearings before the Court. -3.4.5 The CONTRACTOR shall staff each area with personnel who are fluent in English and trained in courtroom decorum, who have experience in providing testimony in court, who are available to testify, who have knowledge of the probationer and file about which they are called to testify. The staff member, providing testimony in court shall provide both testimony and supporting documentation as may be required by the Court, and, shall, upon disposition of the case by the Court, assure that all required documents are timely filed and take action as ordered by the Court. 3.4.6 The CONTRACTOR shall submit a weekly statement to the Court or its representative for the amount of Court fines, costs and restitution ordered by the Court and collected by the CONTRACTOR from the Probationers. This report shall provide to the Court collection data by area of the Florida Keys. 3.4.7 The CONTRACTOR shall tender all fines, costs and restitution ordered by the Court and collected by the CONTRACTOR. Payments shall be applied first to Restitution. 3.4.8 The CONTRACTOR shall maintain fine, restitution and/or court costs collected from the Probationers in an escrow account without the benefit or profit from said accounts. 3.5 Offices and Office Hours 3.5.1 The CONTRACTOR shall maintain at least one office in each area of the Keys (Key West and the Lower Keys, Middle Keys, and Upper Keys). The hours of operation of the CONTRACTOR shall be flexible to encourage employment of the probationers. The CONTRACTOR shall notify the probationers of its hours of operation. 3.5.2 Each area shall have flexible office hours, and shall be open regular hours from 8:00 to 5:00 week days, shall alternate personnel so as to remain open during the lunch hour, shall provide additional office hours one day per week .from 5:00 pm to 7:00 pm on week days and a minimum of four consecutive hours on Saturdays as needed to ensure probationers are able to report and maintain employment. On call hours may be acceptable after regular office hours and on Saturdays so long as one regularly scheduled week day will be staffed until 7:00 pm and as long as a minimum of two Saturdays per month are staffed S /P and/or the staff member on-call is able to respond to a scheduled probationers' appointment on Saturday. 3.6 Job Assistance The CON TRACTOR shall encourage unemployed probationers to improve the probationer's employability through schools and training. The CONTRACTOR shall provide service to all probationers in securing suitable employment and shall provide to the Administrative County Judge or his designee a written document detailing its job assistance procedures. 3.7 Supervision 3.7.1 Initial Intake and Counseling. The CONTRACTOR shall require an initial face-to-face contact with all probationers for counseling and supervision upon initiation of probation. The CONTRACTOR shall clearly explain all of the terms of probation to the probationer in a manner that the probationer understands.The CONTRACTOR shall conduct a substance abuse evaluation of the probationer within fifteen(15) days of the initiation of the probation if ordered by the Court. The CONTRACTOR shall verify the probationer's actual home address by scheduling a site visit with the probationer and meeting at the probationer's home within the first thirty (30) days of the probation. The CONTRACTOR shall verify the probationer's employment within the first thirty (30) days of the probation, or within 30 days of obtaining employment, unless specifically waived by the Court. 3.7.2 Supervision. The CONTRACTOR shall supervise the probationer and make every effort to ensure the probationer's attendance at the reporting and - counseling sessions described in this paragraph. In addition to the initial intake and counseling session noted above, most probationers will be required to report to the CONTRACTOR'S office once per week during the first month of their probationary term. Probationers will then be required to report once per month for the remainder of their probationary term. The Court may alter the frequency of visits in individual cases. Attendance by the probationer at Court-ordered counseling sessions is also required. 3.7.3 Electronic Monitoring. The CONTRACTOR shall also be required to provide electronic monitoring of certain probationers as directed by the Court. Costs of electronic monitoring shall be borne by the probationers and shall be in addition to the payment of supervision fees referenced in this Agreement. 3.8 Court Orders Proposed orders of probation violation,probation modification, and early termination shall be prepared by the CONTRACTOR and shall conform to a format adopted by the COURT. 3.9 Community Service Work The CONTRACTOR may refer probationers to approved non-profit service organizations or County or municipal governments for completion of community service hours. The CONTRACTOR will refer probationers first to any of the aforementioned entities which have a specific project which requires community service workers. The CONTRACTOR is not permitted to utilize the service of probationers to perform community service work to the benefit of the CONTRACTOR. CONTRACTOR shall maintain as part of the probationer's record all community service hours completed and/or not completed by the probationer. 3.10 Violation of Probation - - 3.10.1 When a violation of any term of probation is alleged to have occurred, the CONTRACTOR shall advise the sentencing Court of the alleged violation(s) by sworn affidavit within fifteen (15) days of the occurrence. 3.10.2 If the affidavit recommends revocation of probation, the affidavit must include the reasons therefore and the circumstances under which revocation is being recommended. 3.10.3 In the event that the CONTRACTOR recommends termination of probation prior to the probationer having completed payment of restitution, fines or Court costs,without notifying the sentencing Court that the conditions have not been completed,the CONTRACTOR shall be responsible for payment of any remaining restitution, fines or costs unless waived for good cause by the sentencing Court. 3.10.4 In any case in which the sentencing Court's jurisdiction has been lost prior to all conditions of probation being satisfied,the CONTRACTOR shall transmit a copy of the case file to the judge in whose division the case has been heard. The probation officer shall transmit with the case file a cover letter on CONTRACTOR'S letterhead providing details of the efforts made by that officer to seek compliance with the terms of probation. 3.11 Employees and Subcontractors 3.11.1 No later than the execution of this AGREEMENT, the CONTRACTOR shall submit to the Court Administrator, or his designee, a list of the names of all probation employees, including those of any subcontractors or independent Contractors, if any, to be used by the CONTRACTOR in providing the-services- under this AGREEMENT. This list shall include the education levels and job titles of the employees, subcontractors and independent Contractors. This list shall be updated at least annually, upon the anniversary of the date of this r . AGREEMENT. All personnel and employees of all subcontractors and , independent Contractors used by the CONTRACTOR shall be cleared prior to using the individual through a criminal background records check, as required by State statute and paragraph 3.11.6 of this agreement. 3.11.2 The CONTRACTOR shall provide at its own expense all necessary personnel to provide the services under this AGREEMENT. The probation personnel shall not be employees,of or have any contractual relationship with the County, the Court, or any law enforcement agency. 3.11.3 The CONTRACTOR shall maintain a minimum staffing level of at least one (1)probation officer per two hundred(200) probationers to ensure effective supervision of probationers. To the highest extent possible, the CONTRACTOR shall assign each probationer to a specific probation officer who shall maintain and be responsible for the case throughout the term of the probation. 3.11.4 All of the services required herein shall be performed by the CONTRACTOR or under its supervision. To the extent that CONTRACTOR - uses subcontractors or independent Contractors, this AGREEMENT specifically requires that the level of independence normally exercised by such subcontractors and independent Contractors be curtailed and that they be supervised by the CONTRACTOR. - 3.11.5 All personnel engaged in performing services under this AGREEMENT shall be fully qualified,and, if required,to be authorized or permitted under State and local law to perform such services. 3.11.6 All probation officers and supervisors performing services under this AGREEMENT shall possess a Bachelor's degree from an accredited college or university or have an equivalent combination of education and relevant experience. A background check, including FCIC check, verification of relevant employment and claimed education shall be conducted for newly hired probation officers and supervisors to determine if they are of good character and have no felony or other conviction involving dishonesty or deceit. Pursuant to Sect. 948.15(3)(b),.Florida Statutes, qualifications and criminal record checks of staff shall comply with standards established by the American Correctional Association. The results of the background checks shall be kept on file and available for examination by the COURT and the County. 3.11.7 Each officer, director, principle, and probationary service employee shall provide an affidavit executed under oath, subject to the penalties for perjury established under Chapter 837, Florida Statutes,that the information provided for his application and/or background check is true and accurate, that there are no material omissions therein,and that the intentional false execution of the affidavit constitutes a misdemeanor of the second degree. These affidavits shall be maintained by the CONTRACTOR and made available to the Court Administrator upon request. 3.12 CONTRACTOR'S Financial Records 3.12.1 The CONTRACTOR shall maintain financial records capable of being audited of all fines, restitution, and supervision fees received,expended and disbursed by.the CONTRACTOR. An annual financial report audited and certified by a licensed Certified Public Accountant shall be provided to the County Clerk and to the Court Administrator or his designee within one hundred twenty(120)days following the close of the CONTRACTOR'S fiscal year. The certified financial report shall be in such detail as to disclose the revenues, expenses, and disbursements relating to the services provided under this AGREEMENT. Notes to the financial statements shall disclose noncompliance with requirements of this AGREEMENT concerning conflict of interests. 3.12.2 The CONTRACTOR shall also record and maintain statistical data concerning the number and types of cases being handled, terminated and completed, number of visits, hours of community service preformed by probationers, and such additional information as may be required by the Administrative County Judge,the Court Administrator, or the County. A _ quarterly report shall be submitted to the Court Administrator and to the Administrative County Judge. 3.12.3 The CONTRACTOR shall provide to the Court Administrator and the County a copy of the CONTRACTOR'S fiscal budget each year within thirty (30) days of the beginning of its fiscal year. 3.12.4 The CONTRACTOR shall retain all records pertaining to this AGREEMENT for a period of five (5) years after the termination of this AGREEMENT. 3.12.5 The County,the COURT, the State Auditor General,and agents thereof shall have access to CONTRACTOR'S books, records, and documents required by this AGREEMENT for the purposes of inspection or audit during normal business hours, at the CONTRACTOR'S place(s) of business. 3.13 Public Records and Open Meeting Laws • The CONTRACTOR acknowledges the requirement, in so far as it may be deemed to be acting on behalf of either the COUNTY or the Court, to comply, when applicable, with Florida public records and open meeting laws. 3.14 Confer with Others The CONTRACTOR shall confer with Court staff,the Judges, the State - Attorney and Assistant State Attorneys on cases as appropriate. 4, PAYMENTS TO THE CONTRACTOR 4.1 -The CONTRACTOR is entitled to collect from each probationer costs of supervision as may be ordered by the sentencing Court and as authorized by Florida Statute, This amount is established by the COURT, as of the date of this AGREEMENT, at$50 per month per probationer. The COURT shall review this amount at least annually and may order an increase for new cases. 4.2 The COUNTY, the Chief Administrative Judge, the Court Administrator, or the COURT, individually and collectively, do not assume any liability to the CONTRACTOR for its costs of supervision or any uncollected fees. The CONTRACTOR shall look solely to the probationers for such payments. 4.3 The CONTRACTOR shall accept payments for restitution, fines, and court costs in such forms as are acceptable to the CONTRACTOR. Partial payments shall be accepted and appropriate records maintained. Written receipts shall be issued to the probationers for alI payments received by the CONTRACTOR. CONTRACTOR shall make all restitution payments to the victim promptly following receipt. CONTRACTOR shall make all payments of fines and Court costs to the Clerk of Court within five (5) working days following receipt. In any case in which the victim cannot be located or in which less than the full amount of the fine and costs are collected, the CONTRACTOR shall request that the sentencing Court instruct the CONTRACTOR as to proper disposition. 4.4 The sentencing Court may, in its discretion, order that cost of supervision fees be waived in cases involving indigent probationers and the CONTRACTOR agrees to accept such cases without the supervision fee. 4.5 A written document detailing procedures for handling collection of probationers'. fees and restitution will be provided by the CONTRACTOR to the Administrative County Judge no later than five (5) days following the approval by the Board of County Commissioners of this AGREEMENT. 4.6 The COUNTY and the COURT make no representations as to the number, if any, of cases that may be assigned to the CONTRACTOR. 5. TERM OF AGREEMENT The term of this AGREEMENT is for Three (3)years, commencing on the 1st day of August, 2007, and ending on the 31st day of July, 2010. COUNTY, with the consent of the Administrative Judge, has the option of renewing this AGREEMENT for four (4) additional one-year terms. COUNTY shall provide CONTRACTOR at least thirty (30) days notice of its intent to renew. 6. CONTRACTOR'S ACCEPTANCE OF CONDITIONS 6.1 The CONTRACTOR hereby agrees that he has carefully examined the courthouse facilities for each area of the Keys for which he shall provide services and has made investigations to fully satisfy himself that such site(s) is (are)correct and suitable for this work and he assumes full responsibility therefor. The provisions of the AGREEMENT shall control any inconsistent provisions contained in the specifications. All specifications have been read and carefully considered by the CONTRACTOR, who understands the same and agrees to their sufficiency for the work to be done. Under no circumstances,conditions, or situations shall this AGREEMENT be more strongly construed against the COUNTY than against the CONTRACTOR. 6.2 Any ambiguity or uncertainty in the specifications shall be interpreted and construed by the COUNTY, and his decision shall be final and binding upon all parties. 6.3 The CONTRACTOR agrees that the Court Administrator may designate representatives to visit the CONTRACTOR'S probation facility(ies)periodically to conduct random open file evaluations during the CONTRACTOR'S normal business hours. 6.4 The CONTRACTOR has, and shall maintain throughout the term of this AGREEMENT, appropriate licenses and approvals required to conduct its business, and that it will at all times conduct its business activities in a reputable manner. Proof of such licenses and approvals shall be submitted to the County upon request. 7. HOLD HARMLESS AND INSURANCE The CONTRACTOR covenants and agrees to indemnify and hold harmless Monroe County,the Board of County Commissioners and the Court of the 16th Judicial District of Monroe County from any and all claims for bodily injury (including death), personal injury, and property damage (including property owned by Monroe County) and any other losses, damages, and expenses (including attorney's fees) which arise out of, in connection with, or by reason of services provided by the CONTRACTOR or any of its Subcontractor(s), occasioned by the negligence, errors, or other wrongful act of omission of the CONTRACTOR or its Subcontractors,their employees, or agents. The extent of liability is in no way limited to, reduced, or lessened by the insurance requirements contained elsewhere within this agreement. Prior to execution of this agreement, the CONTRACTOR shall furnish the COUNTY Certificates of Insurance indicating the minimum coverage limitations as indicated by an"X"on the attached forms, each attached hereto and incorporated as part of this AGREEMENT document, and all other requirements found to be in the best interest of Monroe County as may be imposed by the Monroe County Risk Management Department 8. INDEPENDENT CONTRACTOR At all times and for all purposes under this agreement the CONTRACTOR is an independent CONTRACTOR and not an employee of Monroe County. No statement - contained in this agreement shall be construed so as to find the CONTRACTOR or any of his employees, CONTRACTORS, servants, or agents to be employees of Monroe County. 9. NONDISCRIMINATION COUNTY and CONTRACTOR agree that there will be no discrimination against any person, and it is expressly understood that upon a determination by a court of competent jurisdiction that discrimination has occurred,this Agreement automatically terminates without any further action on the part of any party, effective the date of the court order. COUNTY or CONTRACTOR agree to comply with all Federal and Florida statutes, and all local ordinances, as applicable, relating to nondiscrimination. These include but are not limited to: Title VII of the Civil Rights Act of 1964 (PL 88- 352) which prohibits discrimination on the basis of race, color or national origin; Title IX of the Education Amendment of 1972, as amended (20 USC ss. 1681-1683, and 1685-1686), which prohibits discrimination on the basis of sex; Section 504 of the Rehabilitation Act of 1973, as amended (20 USC s. 794), which prohibits discrimination on the basis of handicaps; The Age Discrimination Act of 1975, as amended (42 USC ss. 6101-6107) which prohibits discrimination on the basis of age; The Drug Abuse Office and Treatment Act of 1972 (PL 92-255), as amended,relating to nondiscrimination on the basis of drug abuse; The Comprehensive Alcohol Abuse and Alcoholism Prevention, Treatment and Rehabilitation Act of 1970 (PL 91-616), as amended, relating to nondiscrimination on the basis of alcohol abuse or alcoholism; The Public Health Service Act of 1912, ss. 523 and 527 (42 USC ss. 690dd-3 and 290ee-3), as amended, relating to confidentiality of alcohol and drug abuse patent records; Title VIII of the Civil Rights Act of 1968 (42 USC s. et seq.), as amended,relating to nondiscrimination in the sale, rental or financing of housing; The Americans with Disabilities Act of 1990 (42 USC s. 1201 Note), as may be amended from time to time, relating to nondiscrimination on the basis of disability; Any other nondiscrimination provisions in any Federal or state statutes which may apply to the parties to, or the subject matter of, this Agreement. 10. ASSIGNMENT/SUBAGREEMENT The CONTRACTOR shall not assign or subcontract its obligations under this agreement, except in writing and with the prior written approval of County, which approval shall be subject to such conditions and provisions as COUNTY may deem ( necessary. This paragraph shall be incorporated by reference into any assignment or subcontract and any assignee or subcontractor shall comply with all of the provisions of this agreement. Unless expressly provided for therein, such approval shall in no manner or event be deemed to impose any additional obligation upon the board. 11. COMPLIANCE WITH LAW In providing all services pursuant to this agreement,the CONTRACTOR shall abide by all statutes, ordinances, rules and regulations pertaining to, or regulating the provisions of, such services, including those now in effect and hereinafter adopted. Any violation of said statutes,ordinances, rules and regulations shall constitute a material breach of this agreement and shall entitle the Board to terminate this AGREEMENT immediately upon delivery of written notice of termination to the CONTRACTOR. The CONTRACTOR shall possess proper licenses to perform work in accordance with these specifications throughout the term of this AGREEMENT. 12. DISCLOSURE AND CONFLICT OF INTEREST The CONTRACTOR represents that it, its directors,principles and employees, presently have no interest and shall acquire no interest, either direct or indirect, which would conflict in any manner with the performance of services required by this AGREEMENT, as provided in Sect. 112.311, et. seq.,Florida Statutes. Upon execution of this AGREEMENT, and thereafter as changes may require, the CONTRACTOR shall notify the and the Court Administrator of any financial interest it may have in any and all programs utilized by those people placed on probation in Monroe County which the CONTRACTOR sponsors, endorses, recommends, supervises, or requires for counseling,assistance, evaluation, or treatment. This provision shall apply whether or not such program is required by statute,as a condition of probation, or is provided on a voluntary basis. 13. ARREARS The CONTRACTOR shall not pledge the County's credit or make it a guarantor of payment or surety for any AGREEMENT, debt, obligation,judgment, lien, or any form of indebtedness. The CONTRACTOR further warrants and represents that it has no obligation or indebtedness that would impair its ability to fulfill the terms of this AGREEMENT. 14, NOTICE REQUIREMENT Any notice required or permitted under this agreement shall be in writing and hand delivered or mailed, postage prepaid, to the other party by certified mail,returned receipt requested, to the following: FOR COUNTY Monroe COURT Administrator and County Attorney 500 Whitehead Street PO Box 1026 Key West, FL 33040 Key West,FL 33041- 1026 FOR CONTRACTOR: Court Options, Inc.. Attn: Eddy Lacasa 17984 Franjo Rd. Palmetto bay, FI. 33156 Telephone No.(305) 378-8122 15. TAXES The County's exempt from payment of Florida State Sales and Use taxes. The CONTRACTOR shall not be exempted by virtue of the County's exemption from paying sales tax to its suppliers for materials used to fulfill its obligations under this AGREEMENT, nor is the CONTRACTOR authorized to use the County's Tax Exemption Number in securing such materials. The CONTRACTOR shall be responsible for any and all taxes, or payments of withholding, related to services rendered under this agreement. 16. TERMINATION 16.1 The COUNTY may terminate this AGREEMENT for cause in the event that CONTRACTOR materially breaches any of the terms and provisions of this Agreement and such breach continues for a period of ten(10) days after written notice thereof from COUNTY to CONTRACTOR, or in the case of a breach which cannot with due diligence be cured within such period often (10) days where CONTRACTOR fails to proceed with all due diligence within such period of ten(10) days to commence to cure the same and thereafter to pursue the curing of such breach with all due diligence, cause shall constitute a breach of the obligations of the CONTRACTOR to perform the services enumerated as the CONTRACTOR'S obligations under this AGREEMENT. 16.2 Either of the parties hereto may terminate this AGREEMENT without cause by giving the other party one hundred and eighty (180)days written notice of its intention to do so. 17. GOVERNING LAW,VENUE, INTERPRETATION, COSTS, AND FEES This Agreement shall be governed by and construed in accordance with the laws of the State of Florida applicable to Agreements made and to be performedentirely in the State. In the event that any cause of action or administrative proceeding is instituted for the enforcement or interpretation of this Agreement, the COUNTY and CONTRACTOR 60a i1tf1F • • • agree that venue will lie in the appropriate court or before the appropriate administrative body in Monroe County, Florida. 18. MEDIATION The COUNTY and CONTRACTOR agree that, in the event of conflicting interpretations of the terms or a term of this Agreement by,or between any of them the issue shall be submitted to mediation prior to the institution of any other administrative or legal proceeding. Mediation proceedings initiated and conducted pursuantto this Agreement shall be in accordance with the Florida Rules of Civil Procedure and usual and customary procedures required by the Circuit Court of Monroe County.Mediation prior to institution of litigation of administrative proceeding shall not exclude a court ordered mediation following institution of litigation if ordered by a judge or magistrate. 19. SEVERABILITY If any term, covenant, condition or provision of this Agreement(or the application thereof to any circumstance or person) shall be declared invalid or unenforceable to any extent by a court of competent jurisdiction,the remaining terms, covenants, conditions and provisions of this Agreement, shall not be affected thereby; and each remaining term, covenant, condition and provision of this Agreement shall be valid and shall be enforceable to the fullest extent permitted by law unless the enforcement of the remaining terms, covenants, conditions and provisions of this Agreement would prevent the accomplishment of the original intent of this Agreement. The COUNTY and CONTRACTOR agree to reform the Agreement to replace any stricken provision with a valid provision that comes as close as possible to the intent of the stricken provision. 20. ATTORNEY'S FEES AND COSTS COUNTY and CONTRACTOR agree that in the event any cause of action or administrative proceeding is initiated or defended by any party relative to the _ enforcement or interpretation of this Agreement,the prevailing party shall be entitled to reasonable attorney's fees. Each party agrees to pay its own court costs, investigative, and out-of-pocket expenses whether it is the prevailing party or not, through all levels of the court system. 22. ADJUDICATION OF DISPUTES OR DISAGREEMENTS COUNTY and CONTRACTOR agree that all disputes and disagreements shall be attempted to be resolved by meet and confer sessions between representatives of each of COUNTY and CONTRACTOR. If no resolution can be agreed upon within 30 days after the first meet and confer session, the issue or issues shall be discussed at a public meeting of the Board of County Commissioners. If the issue or issues are still not resolved to the satisfaction of COUNTY and CONTRACTOR, then any party shall have the right to seek such relief or remedy as may be provided by this Agreement or by Florida law. ri5Vil® 23. COOPERATION In the event any administrative or legal proceeding is instituted against either party _relating to the formation, execution,performance, or breach of this Agreement, COUNTY and CONTRACTOR agree to participate,to the extent required by the other party, in all proceedings, hearings, processes, meetings, and other activities related to the substance of this Agreement or provision of the services under this Agreement. COUNTY and CONTRACTOR specifically agree that no party to this Agreement shall be required to enter into any arbitration proceedings related to this Agreement. 24. BINDING EFFECT The terms,covenants,conditions, and provisions of this Agreement shall bind and inure to the benefit of COUNTY and CONTRACTOR and their respective legal representatives, successors, and assigns. - 25. AUTHORITY Each party represents and warrants to the other that the execution, delivery and performance of this Agreement have been duly authorized by all necessary COUNTY and corporate action, as required by law. 26, CLAIMS FOR FEDERAL OR STATE AID CONTRACTOR and COUNTY agree that each shall be, and is,'empowered to apply for, seek,,and obtain federal and state funds to further the purpose of this Agreement; provided that all applications,requests, grant proposals, and funding solicitations shall be approved by each party prior to submission. . 27. PRIVILEGES AND IMMUNITIES All of the privileges and immunities from liability, exemptions from laws, ordinances, and rules and pensions and relief, disability, workers' compensation, and other benefits which apply to the activity of officers, agents, or employees of any public agents or employees of the COUNTY, when performing their respective functions under this Agreement within the territorial limits of the COUNTY shall apply to the same degree and extent to the performance of such functions and duties of such officers, agents, volunteers, or employees outside the territorial limits of the County. 28. NON-RELIANCE BY NON-PARTIES No person or entity shall be entitled to rely upon the terms, or any of them, of this Agreement to enforce or attempt to enforce any third-party claim or entitlement to or benefit of any service or program contemplated hereunder, and the COUNTY and the CONTRACTOR agree that neither the COUNTY nor the CONTRACTOR or any agent, 1. f officer,or employee of either shall have the authority to inform,counsel, or otherwise _ indicate that any particular individual or group of individuals,entity or entities, have entitlements or benefits under this Agreement separate and apart, inferior to, or superior to the community in general or for the purposes contemplated in this Agreement. • 29. ATTESTATIONS CONTRACTOR agrees to execute such documents as the COUNTY may reasonably require, to include a Public Entity Crime Statement, an Ethics Statement, a Drug-Free Workplace Statement, Non-Collusion Affidavit, Lobbying and Conflict of Interest Clause,and an Indemnification Statement. 30. NO PERSONAL LIABILITY No covenant or agreement contained herein shall be deemed to be a covenant or agreement of any member, officer, agent or employee of Monroe County in his or her individual capacity, and no member, officer, agent or employee of Monroe County shall be liable personally on this Agreement or be subject to any personal liability or accountability by reason of the execution of this Agreement. 31. EXECUTION IN COUNTERPARTS This Agreement may be executed in any number of counterparts, each of which shall be regarded as an original, all of which taken together shall constitute one and the same instrument and any of COUNTY and CONTRACTOR hereto may execute this . Agreement by singing any such counterpart. 32. SECTION HEADINGS Section headings have been inserted in this Agreement as a matter of convenience of • reference only, and it is agreed that such section headings are not a part of this Agreement and will not be used in the interpretation of any provision of this Agreement. IN,WITNESS WHEREOF the parties hereto have executed this Agreement olAthgay : first written above in four (4)counterparts;each of which shall, witht plpof .accsrutg for the other counterparts, be deemed an original AGREEMENT, <" r*7 s a `— -•- N `AE _ -- BOARD OF COUNTY - .- `o .. COMMISSIONERS =, • w Attest' DA1sTNY L. KOLHAGE, CLERK OF MONROE COUNT ; can ; FLORIDA By: B}� Deputy Clerk Mayor/Chairman MONROE COUNTY ATTORNEY APPROVED AS TO FO NATILEENE W. CASSEL ASSISTANT COUNTYATTOANEY Date 2 —I '' 40a 4J g /7 T /F CONTRACTOR: /' CQURT OPTIONS Attest: del)! WITNESS By: Eduardo R. Lacasa Its:President i EXHIBIT"A" 33.5 The Contractor shall provide electronic monitoring services as orc Bred by the Court,with the expenses to be borne by the probationer, The description of the electronic -- monitoring services,the responsibilities of the Contractor and the Court,as well as the notification for alerts are described in Exhibit A. • 1; See Attachments for Alcohol Monitoring 2, GPS Monitoring Contractor will work with Secure Alert which provides state of the art GPS monitoring products and services using two or three way voice communications and wireless location technology and real time,2417 monitoring. The GPS devices are nearly indestructible,tamper proof and water re Istant.The device has a built In processing unit(CPU)that is able to alert the Monitoring Center of any efforts to tamper with it.The ankle strap requires destruction ofthe strap for removal. Key features include: - - Active Tracking GPRS/GSM Enabled Set Restrictions(inolusion/exciusion areas) 24/7 Remote Access for law enforcement Tamper Resistant - • Two-Way Voice Communication Data Store Forward Rechargeable/Replaceable Batteries • EXHIBIT"B" ( 3.3.6 The Contractor shall provide program services to Probationers when ordered by the Court.The pricing and description of the Programs offered are attached as ExhIbit B. Diversion Pee: $60.00 Monthly . _ - Course.s: $75.00(All Classes) Scram: Sliding Scale • Record Seal Workshop $40.00 . _ • • illlllltll w1111.1 OTMON Adult Sex Education .• 4 total hours One session: Designed for Individuals who.have been arrested for sax related offenses..Risk taking behavior is discussed along with Impulse control issues.The Individual is challenged to explore the behaviors and underlying issues ihat led to the arrest.A trained therapist faalitates this class.Recommendations for treatment are available when appropriate. Anger Management 8 total hours Four sessions: Designed for clients Who display anger related behavior during the arrest on who are arrested for a crime where anger issues were evident, Cients are educated on strategies to help prevent future anger management proN.►ems.This course focuses on teaching the following: Interpersonal skill building,cognitive behavioral strategies,conflict resolution and impulse control. 'Changing iFaulty Thinking 12 total hours Three Sessions: This course is more comprehensive than the values course described abc ve.The course is designed for clients who have been charged with felony and misdemeanor offenses.The course is appropriate for defendants: to have more than one previous arrest The course will focus on identifying criminal thinking patterns coupled with providing strategies on how to prevent future criminal behavior. Driving While Ucense Suspended 4 total hours One session., Designed to provide education to the participant on public safety issues coup ed with skills that will help the individual obtain a valid drivers license. The goat of this class is to reduce recidivism by providing the participant the specific consequences of their choices along with skills to help prevent future arrest. - - Drug and Alcohol Education 8 total hours Two sessions: Designed for clients Who have been arrested for drug and alcohol related offenses,Facilitators educate clients in the direction of self-evaluation,Facilitators educate clients on the criteria for dependence and abuse act:cl ling to DSM-IV guidelines.Additionally, recommenda- tions are provided for clients who appear to display signs that indicate a risk for present or fti lure drug or alcohol related problems. - Effective Parenting 8 total hours Fauriasions: Designed to focus on skill building techniques to help improve parenting slaps. Clients explore beliefs and attitudes that influence their current parenting practices. - Florida Fish end Wildlife 4 total hours On jegaion: This course Is designed for individuals charged with:boating,fishing and wit life offenses.Florida law is discussed along with be- haviors and beliefs that have led to violating Florida law, Shoplifting 4 total hours Two Sessions: Designed for clients who have been charged with retail theft Clients explai is the beliefs and attitudes that support the behaviors that led to the wrest Clients are challenged to accept responsibility for their behavior and a a educated on strategies to help prevent future crimi- nal behavior. - Understanding HIV and Aids 2 total hours One session: Faciltated by a certified HIV instructor.Prevention of sexually transmitted dist uses is discussed,as well as behaviors and attitudes that lead to risk taking behavior. Values and Personal Responsibility 4 total hours Two Sessions: Designed to encourage clients to evaluate their belief system.Clients are chi rllenged to explore the values that support the behav- iors that led to the arrest Clients are provided with strategies to help prevent future criminal tehavior, Weapons 4 total hours One session: Designed for individuals charged with a weapon related offense.Florida law Is discussed along with safety concerns.The individual Is challenged to explore the behaviors that led to the arrest. 12i90 N.E.70r Avenue,Suite 220 17284 S.W.9701 Avenue .200 Southwest 27th Avenue North Miami,Florida 33181 MIaml,Florida 33167 Fort Lauderdale,Rorids 33312 Ph.(305)091.5330 Ph.(305)378.8122 Ph.(Qsg 5i7.8881 Fr.(305)8171.5388 Frt.'(305)378-8123 Ft.O51)587-8887 — �.i 1a, ES—z • COURT RECORD SEAL . We all have a past...Don't. lel: yotirs stop you Court Options offers a RecordSealing and Expunction Workshop which can help put closure to a past arrest. The arrest will be removed from public record. During the one hour Workshop: • An attorney will facilitate All required forms provided • . Notary Public on site ▪ Finger Print Technician on site . Review Give yourself peace of mind knowing your arrest is no longer available on public record Classes available in • Call today to register for . our next workshop. English and Spanish . during convenient Dade: 305-891-5330 g hours. urs. 3 05-37$-8122 evening g 8r - ovr a rd: 954 587-8881 $25.00 Workshop Fee COURT OPIAONS DWLS Program Driving While License Suspended Program Our goal is to develop a comprehensive program to assist our community ob- tain a legal drivers license. The program would assist the Broward County State Attorneys office by providing support and oduca�tion to the participants. DWLS Educational Classes 4 total hours One Session: Designed to provide education to the pZ ticip4nt on public safety issues coupled with skills that will help the individual obtain a valid drivers license. The goal of this class is to reduce recidivism by providing the participant the specific consequences of their choices along with the skills to help prevent future arrest. Topics covered in class: • Values clarification • Problem solving shills • • Decision making skills • Negative consequences to our community • General drug education information related to driving ° Negative consequences of driving with a suspended license • 'Negative financial consequences to individual & community 1 "010.11111MOPPI ear 1242O K E.751 AMNIA Salta 220 17984 S.W.97th A►►wue 200 Softest North ai(a o4 Ronda 33161 We*Florid,33157 FortLaudwdala,Florida 33312 Ph,(305)891-6330 Ph.(305)376-8122 Ph.(854)3874681 Fr.(305)8914381 FL(305)3714123 Px.(954)587. 587 �. -----•T-�� - v - 4--c um awry COURT 111.1 OPT . . * NS �r Court Options Continuous Alcohol Monitoring Program ' (CAMP) Will provide Continuous Alcohol Monitoring protocol into programs that in- clude education, sanctions, treatment, and punishment. The addition of Continuous Alco- hol Monitoring and the true ability to monitor and enforce 24-hour a day sobriety and safety is setting a ,new standard for the way agencies and courts supervise and treat DUI, domestic violence, and other alcohol-triggered on enders. With automated, passive testing from 24 to 48 times per day and daily reporting of tests results delivered right to your desktop, court can now efficiently and cost effectively: • Assess offenders for their alcohol problem • • Detect alcohol around the clock while they're under ourt supervision • Deter defendants from drinking and relapsing while they're on the road to recovery. • Assist treatment counselors with an accurate report of alcohol consumption, rather than relying on self-reports. The CAMP Program will: • . Provide Public Safety for our Community • Reduce the number of arrests • Reduce the number of Individuals driving while under the influence • Safe tax dollars for the local community by providing alternative sentencing options for the court instead of incarceration • Assist the defendant and the family during recoveryoy allowing the individual to re- main employed in the community • Reduce incidents of domestic violence by keeping tho defendant abstinent while in treatment and under court supervision • Fees • One time initial installation fee$75,00 • Average daily cost of$12,00 per day • Sliding fee scale • Payment plans available 12490 IV.E 78h Avenue,Suite 220 17084&W.97th Avenue 200 Southwest-27th Avsnuu North Mang Florida 31161 Wang Aar1dd 33157 Fort Lauderdale,Florida 33312 Ph.P (305) .fir Ph.(30s)379-0122 Phi.(954)517-5 81 01 Fr.(305)3784123 Fig(954)5E7-8887 ACCRD CERTIFICATE OF LIABILITY INSURANCE DATE(MFNODlYYW)912i2b06 . ' PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE >RAL FINANCIAL GROUP • T'-IIS CERTIFICATE DOES NOT AMEND, EXTEND OR .J176 W Sample Rd RECEIV LTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. (. Coral Springs, 'FL 33065-3942 --- — (954) 345-2600 INSUR RS AFFORDING COVERAGE . NAIC# INSURED COURT OPTIONS, INC. SEP ? 8 •?Nto,F2ER • CENTURY SURETY GROUP INSURER : EViANSTON INSURANCE CO 17964 SW 97TH AVE ' MIAMI, FL 33157 MONROE COU FISURER D: I COVERAGES THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED.NOTWITHSTANDING ANY REQUIREMENT,TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN,THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH - POLICIES.AGGREGATE LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. INS(F�DwwL POLICY EFFECTIVE POLICYEXPIRATIO)N LIMITS• - LTR (NERD TYPE QF INSURANCE POLICY NUMBER PATE(MM/DDMf) OAT MIDD/YYL - GENERAL LIABILITY EACH OCCURRENCE S 1,000,000 , DAMAGE i 0 PIN X COMMERCIAL GENERAL LIABILITY PREMISES(Ea occurence) $ 50,000 CLAIMS MADE X OCCUR MED EXP(Any one person) $ . 5,000 , A CCP560367 07/27/08 07/27/09 PERSONAL&ADVINJURY $ 1,000,000 GENERAL AGGREGATE $ 2,000,000 GENL AGGREGATE LIMIT APPLIES PER: - PRODUCTS-COMP/OPAGG $ 1,000,000 X POLICY n JEI T n LOC AUTOMOBILE LIABILITY COMBINED SINGLE LIMIT $ (Ea accident) ANYAUTO ALL OWNED AUTOS BODILY INJURY S SCHEDULED AUTOS (Per person) HIRED AUTOS BODILY INJURY - 5 NON-OWNEDAUTOS (Perasldent) ti PROPERTY DAMAGE - S (Par accident) GARAGE LIABILITY • I' (,• AUTO ONLY-EA ACCIDENT $ C' ANYAUTO a OTHER THAN EA ACC—$ y AUTOONLY: AGG $ EXCESS/UMBRELLA LIABILITY .-- - ••-•- EACH OCCURRENCE $ • _I OCCUR El CLAIMSMADE AGGREGATE S S _ DEDUCTIBLE - S RETENTION S $ - WCSTATU- OTH- WORKERSCOMPENSATIONAND TORYLIMD'S ER EMPLOYERS'LIABILITY EL,EACH ACCIDENT S ANY PROPRIETOR/PARTNER/EXECUTIVE , OFFICERRAEMBER EXCLUDED? E.L.DISFAA -EA EMPLOYE S Ilyea,desctibe eder E.L.DISEASE-POLICY LIMIT $ SPECIAL PROVISIONS below OTHER - B PROF LIABILITY E0836349 04/16/08 04/16/09 1,000,000 • DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES!EXCLUSIONS ADDED BY ENDORSEMENT/SPECIAL PROVISIONS MONROE COUNTY BOARD OF COUNTY COMMISSIONERS IS NAMED AS ADDITIONAL INSURED. CERTIFICATE HOLDER CANCELLATION SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION MONROE COUNTY BOARD OF COUNTY DATE THEREOF,THE ISSUING INSURER WILL ENDEAVOR TO MAIL 30 DAYS WRITTEN COMMIS S I ONERS NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEFT,BUT FAILURE TO DO SO SHALL 110 0 'S IMONTON ST IMPOSE NO OBLI OR LIABILITY OF ANY KI • PON THE INSURER,ITS AGENTS OR GATO BUILDING -- •R2.ENTAT KEY WEST, FL 33040 A,• .1aQE J .ACORD25(2001/08) / e t 0 ACORD CORPORATION 1988 CG - Exhibit #2 First Amendment to the Agreement for Probation Services between Monroe County and Court Options, Inc. dated 05/ 19/2010 FIRST AMENDMENT TO THE AGREEMENT FOR PROBATION SERVICES BETWEEN MONROE COUNTY AND COURT OPTIONS,INC. THIS FIRST AMENDMENT TO THE AGREEMENT FOR PROBATION SERVICES, is made and entered into this day of tray 2010,by and between MONROE COUNTY,FLORIDA, (hereinafter sometimes called the"COUNTY"),and - COURT OPTIONS,INC., a Florida corporation,(hereinafter called the"COURT OPTIONS"). WHEREAS, COUNTY and COURT OPTIONS entered into an AGREEMENT FOR PROBATION SERVICES BETWEEN MONROE COUNTY AND COURT OPTIONS, INC. (AGREEMENT)dated July 18th,2007;and _ WHEREAS,the AGREEMENT allows the COUNTY and COURT OPTIONS the option of four(4)one year renewals;and WHEREAS,COUNTY has been well served by COURT OPTIONS,and it is in the public interest to continue to have COURT OPTIONS continue to provide probation services;and ' WHEREAS, COURT OPTIONS believes that it will be better able to continue to rent space,provide for employees and better serve the COUNTY with the certainty of-two(2) . two year renewals, rather than a series of four(4)one year renewals; and WHEREAS,the Judiciary is in agreement with the change; and NOW THEREFORE, in consideration of the mutual covenants herein set forth and other good and valuable consideration,the receipt and sufficiency of which is hereby acknowledged,the COUNTY and COURT.OPTIONS hereby agree to amend the Agreement as follows: 1. Paragraph 2 shall be amended to read as follows: _ "TERM OF AGREEMENT The term of this AGREEMENT is for Three(3)years,commencing on the l sc day of August,2007, and ending on the 31, day of July,2010. County,with the consent of the Chief Judge of the Court,has the option of renewing this AGREEMENT for few two succeeding periods of(14-ene year two years each. COUNTY shall provide CONTRACTOR at least thirty(30) days notice of its intent to renew." Page 1 of 2 • 2. In all other respects,the original AGREEMENT remains in full force and effect. , IN WITNESS WHEREOF COUNTY and COURT OPTIONS hereto have executed this Agreement To Exercise Option To Extend Agreement For Probation Services Between Monroe County And Court Options,Inc.,on the day and date first written above in four(4) counterparts, each of which shall,without proof or accounting C • A1 1 other counterparts, be deemed an original contract amendment. - - c; ..17\ Board of County Commissioners Of Monroe County - - 'YuL : . •. :..lha:-, erk By: , .s, �'- / Ma r Syl • Murphy Deputy lerk MAY 1 9 2010 Date: MAY 19 2010 Date: For COURT I i IONS: Witnesses for COURT OPTIONS: '//%//�• 1. 90 le‘27". - Signature EA) V Authorized t/- Agent f((JJ� Signature Print Name Print Name: 000,e,G E 8orn4 a oS* Date: 6l1I/b Date: s/i//v Address: /.2 2/qd /1( Wit_G p /t/ass .. //t , f /Z• 33/to/ Telephone Number: 3&,r 333 2514 `'a Print Name: ,L�d i 11- A..454:S' _L Date: Sfgi/l d STATE OF FLORIDA _ :L_.-_ -._a _-_ . COUNTY OF fih/9/T/-'PAGE' Sworn to(or aff ed)and subscribed before me this �- day of /yi¢y , 20/a,by / aE'il j/i4L D/d!R , on behalf of COURT OPTIONS, who is personally known to me or produced the following i identification ',, , t= o '— rn Notary Stamp: Signature of No _ - — • PD NOTARY PV'SLIC-STATE OF FLORIDA Page 2 of 2 Judith Coakley Burke - ag - Ma. = rn 1 Commission#D D898499 c� 2013 . -; - `.9 o Expires: JULY 13, -) BOOED MIT ATLt2 TIC BONDING CO.,INC. i-•7 IV Q Exhibit #3 Agreement to Exercise Option to Extend Agreement for Probation Services between Monroe County and Court Options, Inc. dated 05/ 19/2010 • • AGREEMENT TO EXERCISE OPTION TO EXTEND AGREEMENT FOR PROBATION SERVICES BETWEEN MONROE COUNTY AND COURT OPTIONS,INC. THIS AGREEMENT To Exercise Option To Extend Agreement For Probation Services Between Monroe County And Court Options,Inc.,is made and entered into this lay of Nay ,2010,by and between MONROE COUNTY,FLORIDA, (hereinafter sometimes called the"COUNTY"), and COURT OPTIONS, INC.,a Florida corporation,(hereinafter called the"COURT OPTIONS"). • WHEREAS,COUNTY and COURT OPTIONS entered into an AGREEMENT FOR PROBATION SERVICES BETWEEN MONROE COUNTY AND COURT • OPTIONS, INC. (AGREEMENT)dated July 18th, 2007;and WHEREAS,the AGREEMENT allows COUNTY and COURT OPTIONS, INC. to renew the agreement for an additional two year term; and WHEREAS,COUNTY has been well served by COURT OPTIONS,and it is in the public interest to continue to have COURT OPTIONS continue to provide probation services; and • WHEREAS,the Judiciary is in agreement with the change; and NOW THEREFORE, in consideration of the mutual covenants herein set forth and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, 1. . COUNTY and COURT OPTIONS hereby agree to extend their agreement for one(1)additional two(2) year term. The new term shall begin on August 1,2010 and end on July 31, 2012. (REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK) Page 1 of 2 • 2. In all other respects,the original AGREEMENT remains in full force and effect. IN WITNESS WHEREOF COUNTY and COURT OPTIONS hereto have executed this FIRST AMENDMENT TO THE AGREEMENT FOR PROBATION SERVICES BETWEEN MONROE COUNTY AND COURT OPTIONS,INC.,on the day and date fir written above in four(4) counterparts,each of which shall,without proof or :��'';',. • for the other counterparts,be deemed an original contract amendment. 9:-... -- ,.,:` ," ,_ Board of County Commissioners sir . Of Monroe County • * : t:aii ,li rge,C er. - / - By: °°ati'1 / L►_ Mayo ylvia urphy .• - OS piitty Cle. MAY 1 9 2QfQ Date: MAY 1. For COURT OPTIO► ..: • Witnesses for COURT OPTIONS: Signature of Authorized Corporate Agent 1. -Rr14EA) ocz tt/i* Signature Print Name Print Name:64O tE /20 of/f 60.9 — . Date: s/1Ej/� Date: - 6/'11//0 Address: /.2€/`70 4/€! 7 i �"t r� .tJ M uk , . 38/6/ . . 2 Telephone Number: 333 z Z . Signature Print Name: 74 LAYAd . ..,%• n.S TO ; - STATE OF FLORIDA 4 -.,5 .-/U .... .._..:. COUNTY OF/f I4M/—DIQDE //!! Sworn to(or affirmed)and subscribed before me this T ay of AM}/ ,20/0 by . JeLI 6N j/ h l V,6 ,on behalf of COURT OPTIONS,who is personally known to me or produced the following identification • Notary_Stamp: Signature of No Page of 2 . 1iOTAlil F:':::.::•: \TF OF 1.1.()R11DA Judith Luaidc y rt'"'1:(2 - G o � • T: =Commission#!)1)H98499 -�- — r • \,,,,,•...Expires: JULY 23,2013 BONDED mu.ATLANTIC BONDING CO.,INC. `-}P - , —1 Co, O .�i — ;LMC rn =�;—c> 2 • -:) Gi . NI .CO 0 Exhibit #4 Court Options, Inc. ' s Independent Auditor' s Report. on Audited Financial Statements for years January 1 , 2009 through December 31 , 2012 COURT OPTIONS, INC. FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 • COURT OPTIONS, INC. Table of Contents Page No. FINANCIAL STATEMENTS Independent Auditor's Report 1-2 Balance Sheet 3 Statement of Income 4 Statement of Changes in Stockholders' Equity 5 Statement of Cash Flows 6 Notes to Financial Statements 7-10 SUPPLEMENTAL INFORMATION . . Supplemental Information:Comparative Balance Sheets 11 Supplemental Information:Comparative Income Statements 12 • SHARMA & ASSOCIATE S, INC. - Vishnu Sharma, Certified Public Accountant 4901 NW 17 Way,Suite 305 Ft.Lauderdale,FL 33309 Office(954)284-3080 Fax(954)284-3081 - Auditing -- Accounting — Taxes — Condominium Accounting — Financial Management — Consulting INDEPENDENTAUDITOR'S REPORT To the Board of Directors Court Options, Inc. 17984 Franjo Rd. Palmetto Bay, FL 33156 Dear Board of Directors, • I have audited the accompanying balance sheets of Court Options, Inc. as of December 31, 2012, and the related statements of program income, the Company's cash flows and statement of stockholders' equity for the years January 1, 2009 through December 31, 2012. These financial statements are the responsibility of the Company's management. My responsibility is to express an opinion on these financial statements based on my audit. Management's Responsibility for the Financial Statements - Management is responsible for the preparation and fair presentation of these financial statements in . accordance with accounting principles generally accepted in the United States of America;this includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. . Auditor's Responsibility My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that I plan and perform the.audit to obtain reasonable assurance about whether the financial statements are free from misstatement. - An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgments, including the assessment of risks of material misstatement of the financial statements,whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, I express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion. ' . Members:American Institute of Certified Public Accountants•Florida Institute of Certified Public Accountants Association of Certified Fraud Examiners■Community Associations Institute Basis for Qualified Opinion My ability to test accounts receivable was limited by the Company's inability to produce reports in detail. Accounts Receivable balances were available in summary as an aging report by program and in detail but only for current period.The Company did not retain yearend detail report nor was their accounting system able to reproduce reports in detail from prior period. Qualified Opinion In my opinion, except for possible effects of the matter described in the Basis for Qualified Opinion paragraph, the financial statements referred to above present fairly, in all material aspects, the financial position of Court Options, Inc.as of December 31, 2012,and the results of its operations and cash flows for the years January 1, 2009 through December 31, 2012 in accordance with accordance with accounting principles generally accepted in the United.States of America. These financial statements were prepared solely for the purpose of satisfying the Company's contractual requirements with Monroe County and are intended solely for the use by Monroe County in satisfaction of - that requirement. Velma Slsan6na, Sharma &Associates, Inc. - Ft. Lauderdale, FL August 31,2013 • • American Institute of Certified Public Accountants•Florida Institute of Certified Public Accountants Association of Certified Fraud Examiners•Community Associations Institute Court Options, Inc. . Balance Sheet As of December 31,2012 Assets Current Assets Cash $ 227,571 Cash(Restricted) 327,843 Accounts Receivable(net of allowance for doubtful accounts,$267,532) 409,624 Prepaid Expenses 910 Total Current Assets $ .965,948 Net Fixed Assets 66,971 Other Assets-Security Deposits 22,084 Total Assets $1,055,003 Liabilities and Stockholders' Equity Liabilities Accounts Payable . $ 74,646 Restitution Payable 327,843 Accrued Payroll 198,257 Total Liabilities $ 600,746 Stockholders' Equity Retained Earnings 454,257 Total Liabilities and Shareholders'Equity $1,055,003 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. 3 • Court Options,Inc. Income Statement For the Year Ending December 31,2012 • Revenue Program Revenues $ 3,694,812 92.9% Income From Other Services 281,737 7.1% Total Revenue 3,976,549 100.0% • Operating Expenses Payroll Expenses 1,947,499 49.0% Bad Debts 243,320 6.1% Building Occupancy 261,939 6.6% Administrative Costs 300,711 7.6% Contract Labor 3,220 0.1% _ Insurance Expense 167,464 4.2% Direct Client Costs 169,702 4.3% Licenses and Taxes 2,260 0.1% Office Expenses 100,497 2.5% Professional Fees . - 8,640 0.2% - Total Operating Expenses 3,205,252 80.6% Income from Operations 771,297 19.4% Other Income Interest Income 381 0.0% Net Income $ 771,678 19.4% • • THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. 4 Court Options,Inc. Statement Of Stockholders'Equity For the Year Ending December 31,2012 Common Stock Paid in Retained Shares Par Capital Earnings Total Balance December 31,2011 $ - $ - $ - $ 568,079 $ 568,079 Net Profit December 31,2012 - - - 771,678 771,678 Shareholder Distribution - - - (885,500) (885,500) Balance December 31,2012 $ - $ - $ $ 454,257 $ 454,257 • THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. 5 I Court Options,Inc. - Statement of Changes in Cash Flows For the Year Ending December 31,2012 Net Income(Loss) $ 771,678 Non Cash Adjustments: Write-off of Bad Debt&Allowance for Doubtful Accounts , 243,320 Adjustments to reconcile change in net assets to net cash used by operating activities: (Increase) Decrease accounts receivable (156,648) Increase(Decrease)in Accounts Payable 16,645 Increase(Decrease) in accrued liabilities and other payables 37,120 Net cash flow from operations • - 912,115 • Cash flow from investing activities Investment in Fixed Assets (13,284) Net cash flow from investing activities (13,284) " Cash flow from financing activities Dividends Paid (885,500) Net cash flow from financing.activities (885,500) Net increase(decrease)in cash _ 13,331 Cash at beginning of year 542,0.83 Cash at end of year • _ $ 555,414 Supplemental Information: Interest Expense $ 372 • • THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. 6 Court Options, Inc. Notes to the Financial Statements As of December 31, 2012 Note 1. Organization Court Options, Inc. ("Company") was incorporated as a For Profit Corporation in the State of Florida on June 14, 2004. Simultaneous with their incorporation the Company elected to be treated as a Subchapter S Corporation for Income tax purposes. The Company's main office is located in Palmetto Bay, Florida. In addition, there are several branch offices located throughout South Florida, specifically in Miami-Dade, Broward and Monroe counties. The Company's primary business is to provide a variety of support services to the, criminal justice system. These services include educational courses and workshops, pretrial diversion, case supervision, court specialists and criminal record sealing and expunction workshops.The Company also acts as an escrow agent on behalf of the various judicial agencies, collecting court fees and restitution from client and passing them on to the appropriate agency. The services are provided by Company employees who have a particular expertise in the specific field. Note 2. Summary of significant accounting policies Basis of Accounting The Company uses the accrual basis of accounting, which recognizes revenue when earned and expenses when incurred. Fair Value of Financial Instruments- Financial instruments, including cash, receivables, accounts payable, and notes payable are carried at amounts which reasonably approximate their fair value due to the short term nature of these amounts or due to variable rates of interest which are consistent with market rates. Concentration of Credit Risk - The Company's financial instruments that are exposed to concentration of credit risk are cash and accounts receivable. The Company maintains cash balances in bank deposit accounts, which, at times, may exceed federally insured limits. As of December 31, 2012, the Company held no bank balances that exceeded FDIC insurance limits. Cash and cash equivalents • The Company's considers cash on hand, cash in banks, certificates of deposit, time deposits, U.S. government and other short-term securities with maturity of three months or less when purchased as cash and cash equivalents. Prepaid Expenses The Company pays their annual insurance premiums at one time and then prorates the cost equally over 12 months. That amount that has not been recognized as an expense and other payments made in advance of services rendered as of December 31,2012 is considered to be a prepaid expense. 7 Court Options, Inc. • Notes to the Financial Statements As of December 31, 2012 • Accounts Receivable • Accounts receivable are disclosed net of an allowance for doubtful accounts. As of December 31 the accounts • receivables detail is as follows: - Accounts Receivable $677,156 Allowance for Doubtful Accounts (267,532) Accounts Receivable(net) $409,624 Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities,and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could vary from the estimates that were used. Fixed Assets Fixed assets are stated at cost. Major additions and improvements are capitalized in the month following the month in which the assets or improvement are deemed to be placed in service. Maintenance and repairs are expensed as incurred..Upon disposition, the net book value is eliminated from the accounts, with the resultant gain or loss reflected in operations. Depreciation expense is computed on a straight-line basis over the estimate useful lives of the assets as follows: Machinery and equipment: 5-7 years Furniture and fixtures&transportation equipment: 3-7 years Building 39 years The Company periodically assesses the recoverability of property, plant and equipment and evaluates such . assets for impairment whenever events or changes in circumstances indicate that the net carrying amount of an asset may not be recoverable. Asset impairment is determined to exist if estimated future cash flows, undiscounted and without interest charges,are less than the net carrying amount. Other Assets-Security Deposits Security deposits consist of security deposits for the leases of the Company's offices and utility deposits. Accounts Payable and Accrued Expenses " Accounts payable and accrued expenses consist of expenses incurred by the Company as of December 31,2012, and the amount of the liability was either known or estimated by management, but unpaid. Accounts payable relates primarily to vendor incurred expenses,while accrued expenses are.primarily related to payroll. • 8 • Court Options, Inc. Notes to the Financial Statements As of December 31, 2012 , Recognition of Revenue The Company has adopted SEC Staff Accounting Bulletin (SAB) No. 101 - Revenue Recognition, which defines that revenue is both earned and realizable when the following four conditions are met: • Pervasive evidence of an arrangement exists • The selling price is fixed or determinable • Delivery or performance has occurred • Collectability is reasonably assured • The Company recognizes revenue for its services after they have been performed and collects its fees on a monthly basis directly from the individual clients. Income Taxes Restitution Payable The Company collects various fees and payments for restitution from its clients on behalf of the various fees ordered by the courts and hold the funds in segregated bank accounts. The funds are disbursed to the various counties or victims of crime. Income taxes - • - The Company has elected to be treated as a Subchapter S Corporation under section 1362 of the Internal Revenue Code for income tax purposes. Therefore, all profit or loss is passed on to the shareholders of the Company to be included in their individual tax returns. The Company will file an informational return (1120S) with the IRS on an annual basis. In January 2010, the Financial Accounting Standards Board (FASB) issued additional disclosure requirements for fair value measurements. According to the guidance, the fair value hierarchy disclosures are to be further disaggregated by class of assets and liabilities. A class is often a subset of assets or liabilities within a line item in the statement of financial position. In addition, significant transfers between Levels 1 and 2 of the fair value hierarchy will be required to be disclosed. These additional requirements are effective January 1, 2010 for quarterly and annual reporting.These amendments will not have an impact on the consolidated financial results as this guidance relates only to additional disclosures. In addition, the guidance requires more detailed disclosures of the changes in Level 3 instruments.These changes took effect January 1, 2011. The Company has no income tax returns under examination by the Internal Revenue Services. However, the Association's Federal income tax returns for the last three years (2010, 2011, and 2012) are subject to examination,generally for three years after they are filed. • Court Options, Inc. Notes to the Financial Statements As of December 31,2012 Note 3. Commitments .. - The Company leases it office spaces under non-cancelable operating leases,which have various expiration dates. Rent expense charged to operations under the above operating leases was $217,784 for the year ended December 31,2012. • Note 4.Restricted Cash/Restitution Payable A service provided by the Company requires it to act as an intermediary to disperse restitution to victims. All funds received are tracked independent of operating funds and maintained in segregated bank accounts. Attempts to reach parties designated by the Court to receive.restitution are not always successful and as such the Company can end up holding these funds for many years. The Company is currently working with the requisite Court and State agencies to determine the proper disposition of these funds. Note 5. Subsequent Events - The Company has evaluated events and transactions for potential recognition or disclosure in the financial statements through August 31, 2013, which is the date the financial statements were available to be issued. No subsequent events have been recognized other than that disclosed below.• - • • 10 SUPPLEMENTAL SCHEDULES • COURT OPTIONS, INC. • SUPPLEMENTARY INFORMATION: COMPARATIVE BALANCE SHEETS AS OF DECEMBER 31, • 2012 2011 2010 2009 Assets Current Assets Cash $ 227,571 $ 231,047 $ 149,724 $ 85,915 Cash(Restricted) - 327,843 224,117 187,208 316,618 Accounts Receivable(net of allowance for 409,624 496,295 481,849 479,239 doubtful accounts) Prepaid Expenses 910 910 910 910 Total Current Assets $ 965,948 $ 952,369 $819,690 $ 882,682 Net Fixed Assets 66,971 53,687 35,579 32,323 Other Assets-Security Deposits 22,084 22,084 22,084 22,084 Total Assets $1,055,003 $1,028,140 $877,353 $937,089 Liabilities and Stockholders'Equity Liabilities Accounts Payable $ 74,646 $ 59,663 .$ 35,835 $ 31,741 Restitution Payable 327,843 324,443 246,490 302,533 Accrued Payroll 198,257 162,776 106,388 28,553 Total Liabilities $ 600,746 $ . 546,881 $ 388,713 $ 362,826 Stockholders' Equity Retained Earnings 454,257 481,260 488,641 574,263 Total Liabilities and Shareholders' Equity $1,055,003 $1,028,140 - $877,353 $937,089 11 - - COURT OPTIONS, INC. SUPPLEMENTARY INFORMATION: COMPARATIVE INCOME STATEMENTS FOR THE TWELVE MONTH PERIOD ENDING DECEMBER 31, - 2012 2011 : 2010 2009 - Revenue • Program Revenues $ 3,694,812 $ 4,101,968 $ 2,922,053 $ 2,780,999 Income From Other Services 281,737 225,235. 288,781 180,890 Total Revenue - 3,976,549 4,327,203 3,210,834 2,961,889 Operating Expenses Payroll Expenses- 1,947,499. ." .1,615,050 1,298,426 982,595 • Bad Debts 243,320 459,987 - - Building Occupancy 261,939 269,807. 262,989 261,346 Administrative Costs 300,711 305,607 223,273 179,283 Contract Labor 3,220 290,575 259,406 193,015 ' Insurance Expense 167,464 127,948 " 91;554 83,541 Direct Client Costs 169,702 167,867 150,974 95,445 Licenses and Taxes 2,260 1,669 1,232 1,784 Office Expenses - - 100,498 98,866 84,104 - 75,983 Professional Fees. 8,640 69,415 55,820 43,221 Total Operating Expenses 3,205,252 3,406,793 2,427,778 1,916,212 Income from Operations 771,297 920,410 783,056 1,045,677 Other Income • Interest Income 381 593 51 202 Net Income $ 771,678 $ 921,003 $ 783,107 $ 1,045,879 12 Exhibit #5 Court Options, Inc. ' s Independent Auditor' s Report on Audited Financial Statements for the year ending COURT OPTIONS, INC. FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2013 COURT OPTIONS, INC. Table of Contents Page No. FINANCIAL STATEMENTS Independent Auditor's Report 1-2 Balance Sheet 3 Statement of Income 4 Statement of Changes in Stockholders' Equity 5 Statement of Cash Flows 6 Notes to Financial Statements 7-10 SHARMA & ASSOCIATES, INC. Vishnu Sharma, Certified Public Accountant 4901 NW 17 Way,Suite 305 Ft.Lauderdale,FL 33309 Office(954)284-3080 Fax(954)284-3081 Auditing - Accounting - Taxes . Condominium Accounting - Financial Management - -Consulting INDEPENDENT AUDITOR'S REPORT To the Board of Directors Court Options, Inc. 17984 Franjo Rd. Palmetto Bay, FL 33156 Dear Board of Directors, . I have audited the accompanying balance sheet of Court Options; Inc. as of December 31, 2013, and the related statements of program income, the Company's cash flows and statement of stockholders' equity for the year then ended.These financial statements are the responsibility of the Company's management. My responsibility is to express an opinion on these financial statements based on my audit. - Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America;this includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility My responsibility is to express an opinion on these financial statements based on my audit. I conducted my • audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from misstatement. An audit involves performing procedures to obtain audit evidence about the amounts.and disclosures in the financial statements. The procedures selected depend on the auditor's judgments, including the .- assessment of risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, I express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management,as well as evaluating the overall presentation of the financial statements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion. Members:American Institute of Certified Public Accountants•Florida Institute of Certified Public Accountants Association of Certified Fraud Examiners■Community Associations Institute Basis for Qualified Opinion In my testing of restitution payable, I was able test the actual restitution payable liability, but was unable to reconcile the cash in excess of restitution payable liability. All restitution funds received are tracked independent of operating funds and maintained in segregated bank accounts. Attempts to reach parties designated by the Court to receive restitution are not always successful and as such the Company can end up holding these funds for many years. The Company is currently working with the requisite Court and State agencies to determine the proper disposition of these funds. Monroe County represented less than six percent [6.0%) of all restitution activity in 2013. Qualified Opinion In .my opinion,except for possible effects of the matter described in the Basis for Qualified Opinion paragraph, the financial statements referred to above present fairly, in all material aspects, the financial - position ofCourt Options, Inc. as of December 31,2013, and the results of its operations and cash flows for the year then ended in accordance with accordance with accounting principles generally accepted in the United States of America. These financial statements were prepared solely for the purpose of satisfying the Company's contractual requirements with Miami-Dade and Monroe Counties and are intended solely for the use by Miami-Dade and Monroe County in satisfaction of that requirement. 2/ut 4 Va'sa, ( r� Sharma&Associates, Inc. Ft. Lauderdale, FL April 24, 2014 • American Institute of Certified Public Accountants•Florida Institute of Certified Public Accountants Association of Certified Fraud Examiners■Community Associations Institute Court Options, Inc. Balance Sheet As of December 31,2013 • Assets Current Assets Cash $ 122,989 Cash (Restricted) 237,989 Accounts Receivable (net of allowance for - doubtful accounts,$267,532) 418,215 Prepaid Expenses 10,377 Total Current Assets $ 789,569 Net Fixed Assets 57,053 Other Assets-Security Deposits 21,430 Total Assets $ 868,052 Liabilities and Stockholders'Equity Liabilities Accounts Payable $ 82,563 Restitution Payable 134,274 Accrued Payroll& Payroll Related 238,054 Total Liabilities $ 454,891 Stockholders' Equity Retained Earnings 413,161 Total Liabilities and Shareholders' Equity $ 868,052 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. 3 Court Options,Inc. Income Statement For the Year Ending December 31,2013 Revenue Program Revenues $ 3,635,957 93.4% Income From Other Services 255,763 6.6% Total Revenue 3,891,720 100.0% Operating Expenses - Payroll Expenses _ 1,820,750 46.8% Bad Debts • . 590 0.0% • Building Occupancy 228,100 • 5.9% Administrative Costs 393,504 10.1% Depreciation 23,128 0.6% Insurance Expense 168,521 4.3% Direct Client Costs 180,094 4.6% Licenses and Taxes 1,203 0.0% Office Expenses 73,678 1.9% Professional Fees 77,260 2.0% Total Operating Expenses 2,966,828 76.2% Income from Operations 924,892 23.8% Other Income Interest Income 173 0.0% Net Income $ 925,064 23.8% THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. 4 Court Options,Inc. Statement Of Stockholders'Equity For the Year Ending December 31,2013 Common Stock Paid in Retained Shares Par Capital Earnings Total Balance December 31,2011 $ - $ - $ - -$ 568,079 $ 568,079 Net Profit December 31,2012 - - - 771,678 771,678 Shareholder Distribution - - - (885,500). (885,500) Balance December 31,2012 .$ - $ - $ - $ 454,257 $ 454,257 Net Profit December 31,2013 - - - 924,905 924,905 Shareholder Distribution - - (966,000) (966,000) Balance December 31,2013 $ $ - $ - $ 413,161 $ 413,161 • THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. 5 Court Options,Inc. Statement of Changes in Cash Flows • For the Year Ending December 31,2013 Net Income(Loss) $ 924,905 Non Cash Adjustments: Write-off of Bad Debt&Allowance for Doubtful Accounts - 2,014 Adjustments to reconcile change in net assets to net cash used by operating activities: (Increase) Decrease accounts receivable (10,605) (Increase) Decrease prepaid expense . (9,466) (Increase) Decrease security deposits - 654 Increase(Decrease)in Accounts Payable 7,916 • Increase(Decrease) in accrued liabilities and other payables (153,773) Net cash flow from operations 761,645 Cash flow from investing activities Investment in Fixed Assets 9,919 Net cash flow from investing activities 9,919 Cash flow from financing activities Distributions (966,000) Net cash flow from financing activities (966,000) Net increase (decrease)in cash (194,436) Cash at beginning of year 555,414 Cash at end of year $ 360,977 Supplemental Information: Interest Expense $ 185 • THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. 6 Court Options, Inc. Notes to the Financial Statements As of December 31, 2013 Note 1. Organization Court Options, Inc. ("Company")was incorporated as a For Profit Corporation in the State of Florida on June 14, 2004. Simultaneous with their incorporation the Company elected to be treated as a Subchapter S Corporation for Income tax purposes. The Company's main office is located in Palmetto Bay, Florida. In addition, there are several branch offices located throughout South Florida, specifically in Miami-Dade, Broward and Monroe counties. The.Company's primary business is to provide a variety of support services to the criminal justice system. These services include educational courses and workshops, pretrial diversion, case supervision, court specialists and criminal record sealing and expunction workshops.The Company also acts as an escrow agent on behalf of the various judicial agencies, collecting court fees and restitution from client and passing them on to the appropriate agency. The services are provided by Company employees who have a particular expertise in the specific field. Note 2. Summary of significant accounting policies Basis of Accounting The Company uses the accrual basis of accounting, which recognizes revenue when earned and expenses when incurred. Fair Value of Financial Instruments - Financial instruments, including cash, receivables, accounts payable, and notes payable are carried at amounts which reasonably approximate their fair value due to the short term nature of these amounts or due to variable rates of interest which are consistent with market rates. Concentration of Credit Risk The Company's financial instruments that are exposed to concentration of credit risk are cash and accounts receivable. The Company maintains cash balances in bank deposit accounts, which, at times, may exceed federally insured limits. As of December 31, 2013, the Company held no bank balances that exceeded FDIC insurance limits. • Cash and cash equivalents The Company's considers cash on hand, cash in banks, certificates of deposit, time deposits,.U.S. government and other short-term securities with maturity of three months or less when purchased as cash and cash equivalents. Prepaid Expenses The Company pays their annual insurance premiums at one time and then prorates the cost equally over 12 months. That amount that has not been recognized as an expense and other payments made in advance of services rendered as of December 31, 2013 is considered to be a prepaid expense. 7 Court Options, Inc. Notes to the Financial Statements As of December 31, 2013 Accounts Receivable Accounts receivable are disclosed net of an allowance for doubtful accounts. As of December 31, 2013 the accounts receivables detail is as follows: Accounts Receivable $685,747 Allowance for Doubtful Accounts (267,532) Accounts Receivable (net) $418,215 Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities,and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could vary from the estimates that were used. Fixed Assets Fixed assets are stated at cost. Major additions and improvements are capitalized in the month following the month in which the assets or improvement are deemed to be placed in service.Maintenance and repairs are expensed as incurred. Upon disposition, the net book value is eliminated from the accounts, with the resultant gain or loss reflected in operations. - Depreciation expense is computed on a straight-line basis over the estimate useful lives of the assets as follows: Machinery and equipment: 5-7 years Furniture and fixtures&transportation equipment: 3-7 years Computer equipment 5 years Building 39 years The Company periodically assesses the recoverability of property, plant and equipment and evaluates such assets for impairment whenever events or changes in circumstances indicate that the net carrying amount of an asset may not be recoverable. Asset impairment is determined to exist if estimated future cash flows, undiscounted and without interest charges, are less than the net carrying amount. • Other Assets-Security Deposits Security deposits consist of security deposits for the leases of the Company's offices and utility deposits. Accounts Payable and Accrued Expenses Accounts payable and accrued expenses consist of expenses incurred by the Company as of.December 31, 2013, and the amount of the liability was either known or estimated by management, but unpaid.Accounts payable relates primarily to vendor incurred expenses, while accrued expenses are primarily related to payroll. 8 Court Options, Inc. Notes to the Financial Statements As of December 31, 2013 Recognition of Revenue The Company has adopted SEC Staff Accounting Bulletin (SAB) No. 101 - Revenue Recognition, which defines that revenue is both earned and realizable when the following four conditions are met: • Pervasive evidence of an arrangement exists • The selling price is fixed or determinable • Delivery or performance has occurred • Collectability is reasonably assured The Company recognizes revenue for its services after they have been performed and collects its fees on a monthly basis directly from the individual clients. Income Taxes Restitution Payable The Company collects various fees and payments for restitution from its clients on behalf of the various fees ordered by the courts and hold the funds in segregated bank accounts.The funds are disbursed to the various counties or victims of crime. Income taxes The Company has elected to be treated as a Subchapter S Corporation under section 1362 of the Internal • Revenue Code for income tax purposes. Therefore, all profit or loss is passed on to the shareholders of the Company to be included in their individual tax returns. The Company will file an informational return (1120S) with the IRS on an annual basis. In January 2010,the Financial Accounting Standards Board (FASB) issued additional disclosure requirements for fair value measurements. According to the guidance, the fair value hierarchy disclosures are to be further disaggregated by class of assets and liabilities.A class is often a subset of assets or liabilities within.a line item in the statement of financial position. In addition, significant transfers between Levels 1 and 2 of the fair value hierarchy will be required to be disclosed. These additional requirements are effective January 1, 2010 for quarterly and annual reporting.These amendments will not have an impact on the consolidated financial results as this guidance relates only to additional disclosures. In addition, the guidance requires more detailed disclosures of the changes in Level 3 instruments.These changes took effect January 1, 2011. The Company has no income tax returns under examination by the Internal Revenue Services. However, the Association's Federal income tax returns for the last three years (2011, 2012, and 2013) are subject to examination,generally for three years after they are filed. 9 Court Options, Inc. Notes to the Financial Statements As of December 31, 2013 Note 3. Commitments The Company leases it office spaces under non-cancelable operating leases,which have various expiration dates. Rent expense charged to operations under the above operating leases was $216,988 for the year ended December 31,2013. - Note 4.Restricted Cash/Restitution Payable A service provided by the Company requires it to act as an intermediary to disperse restitution to victims. All funds received are tracked independent of operating funds and maintained in segregated bank accounts. • Attempts to reach parties designated by the Court to receive restitution are not always successful and as such the Company can end upholding these funds for many years. The Company is currently working with the requisite Court and State agencies to determine the proper disposition of these funds. Monroe County represented less than six percent [6.0%] of all restitution activity in 2013. Note 5. Subsequent Events The Company has evaluated events and transactions for potential recognition or disclosure in the financial statements through April 24, 2014, which is the date the financial statements were available to be issued. No subsequent events have been recognized other than that disclosed below. • 10 - Exhibit #6 Court Options Inc. ' s Audit Responses • COURT PTA Amy Heavilin, Clerk of County Court, Monroe County C/O Pamela Limbert Sellers, CFE • Director of Internal Audit • . Ms: Sellers: - • We are in receipt of your letter and findings dated July 25th regarding an audit performed by your division on the Misdemeanor Probation Services_contract, and the provider for those • services, Court Options. _ There are several irregularities and inconsistencies in your findings which we will respond to in an attachment to this letter. We would like to provide some background information regarding the audit and surrounding circumstances: This audit commenced almost twelve months ago.The initial auditor was Mike • Stanek who was removed from the process, although Court Options was never notified of this. _ Court Options provided the initial auditor with information and countless interviews that the replacement auditor could not locate or find. We were then told that your office didn't have "some" of the information we shared with Mr. Stanek. We sincerely believe that this audit was mishandled from it's onset because of the above stated facts, and will attest to that throughout our response. During the majority of our formal interviews with Mr. Stanek, we revealed exactly how we operated and communicated with the Clerk of the County Court in Monroe County. Not once during these interviews were we told to change our practices"immediately". In fact we asked if our practices were satisfactory and appropriate on several occasions and were told to "continue doing what you're doing". This was also the same response we received from the Clerk's Office anytime we inquired about the reports we were providing them with. At one point, we wanted to compare the referrals received to the referrals actually ordererl by the court to Court Options, and were told by the court administrator as well as a clerk's IT department, that they would not be able to provide those numbers or names for us. Additionally we requested from your office the accounts receivable amount from the Clerk's Office to compare to what we may have had outstanding, and your office was not able to provide that number either. Court Options welcomed this audit in order to be found in compliance before the Request for Qualifications for our contract was released. At no time during the length of the contract was COURT OPTIONS Court Options notified by the assigned contract manager (assistant county attorney) or the Court Administrator, as to pending reports and or information, even though we requested direction from these parties on numerous occasions. In fact Court Options received two separate•twoyear extensions to the original three year contract without any questions, requests for information, or verbalized or written concerns • regarding our performance and/or lack thereof. Court Options also has many satisfaction surveys from numerous criminal justice professionals which,consistently report satisfaction with our services.These professionals include clerks from the County Clerk's office, the Court Administrator, private defense attorneys, assistant state attorneys, bailiffs, and all of the County Court and Circuit Court judges for Monroe County. Court Options was also regularly advised by the assistant county attorney (contract manager) that we were performing above satisfactory.- This is why these audit findings are confusing. It seems unlikely and inconceivable that a provider who was not performing to Monroe County's satisfaction or regularly missing report deadlines and/or reports in general be given two separate two year extensions on their contract.It should be noted that the court administrator and the assistant county attorney never brought up any of these issues or concerns regarding missing reports to the administrative judge, or even the Clerk of Court at any time during those four years. Court - Options wasn't given any direction whatsoever regarding where to send reports etc. even after many inquiries. We believe this situation regarding these departments in "charge" of contracts within Monroe County is baffling and would be of great concern to the citizens of Monroe County,There is little to no oversight or direction for these contracts in general from the contract manager (assistant county attorney) or from the court administrator, in our experience. Sincerely, - - Ruben Valdivia Director, Court Options Inc. • • Court Options' Responses to Findings Described in "Audit Report of Monroe County: . Agreement for Misdemeanant Probation Services with Court Options, Inc." I. Finding 1:"Contractually required documentation/reports are not being submitted by Court Options". • a. Monroe County auditors ("Monroe")cites paragraph 3.4.2 in the Agreement for Probation Services (the "Agreement") and states that"Court Options is not providing the • required weekly reports to the Court". However, in the paragraph immediately following this observation, Monroe agrees that Court Options has provided a report that has the "fees,fines and costs contained in the bank wire transfer of funds to the Clerk". This statement appears to be contradictory to the initial finding. Court Options did in fact send reports detailing collections made and remittances to the Court. Please see Exhibit A attached as an example of the reports sent.Court.Options requests that this section be removed from Finding 1. • • -b. Monroe cites paragraph 3.4.6 in the Agreement and states that Court Options shall • "submit a weekly statement to the Court or its representative for the amount of Court fines, costs and restitution ordered by the Court...". On-numerous occasions, Court Options requested guidance from the Contract Manager as to whom should,receive this information. The Contract Manager did not provide such guidance. Additionally, upon the commencement of the Agreement, Court Options submitted these reports to the • Clerk of Courts at the time,Jackie Clynes,who requested that we discontinue submitting these reports. .c. Monroe cites paragraph 3.11.1 in the Agreement and states that"Court Options did not • provide this information to the Court Administrator at any time during the contract period". This statement is incorrect. In addition to providing the list of names of all probation employees in our initial RFQ submitted,Court Options continually updated the Court Administrator of personnel changes throughout the contract period. Additionally, Court Options personnel were in constant contact with Monroe County Court personnel and, if there was ever any question as to their qualifications,the Court Administrators could have easily requested such information. Lastly,this information was provided during the audit. d. Monroe cites paragraph 3.12.1 in the Agreement and states that"Court Options did not provide...annual financial report audited and certified by a licensed CPA for years 2009 through 2012 within 120 days following the close of the fiscal year". Court Options does not dispute this finding, but would like to emphasize that steps were taken to • immediately address the issue and audits for those years were ultimately provided to • • Monroe. Furthermore, those audits did not yield any adverse or qualified opinions from our auditors. e. Monroe cites paragraph 3.12.2 in the Agreement and states that "Court Options did not submit... statistical data concerning the number and types of cases being handled..." Court Options does not dispute this finding, but would like to emphasize that steps were taken to immediately address the issue and statistical information for the years 2010— 2013 was provided immediately. Additionally, Court Options Directors George Romagosa and Ruben Valdivia have historically provided statistical updates via letters, e-mails and reports to Monroe County Court personnel throughout the term of the contract. f. Monroe cites paragraph 3.12.3 in the Agreement and states that"Court Options did not provide to the Court Administrator a copy of Court Options'annual fiscal budget for the years2008, 2010, 2011 and 2012" Court Options provided budgets to the Court Administrator each year under the Agreement.Additionally, Court Options requests that any references to 2008 and 2009 be removed from this report as those years do not fall within the scope of the audit (page 1 of the report states"Scope: A review of Court Options, Inc.'s bank reconciliations, methods of accounting and reporting fines and court cost information to the Court was performed for the period of January 1,2010 through May 31,2013"). g. Monroe cites paragraph 4.5 in the Agreement and states that "Court Options did not provide to the Administrative County Judge a copy of Court Options'Policy and Procedures". Not only did Court Options provide its policies and procedures to Monroe County Court personnel at the onset of the agreement, but a copy was also provided to the Monroe County auditors. Court Options requests that this section be removed from Finding 1. II. Finding 2:"Payments received from Probationers are being held in non-escrow bank accounts and funds are being comingled". - Monroe states that"The main depository account, which accepted all funds remitted by Probationers, was also used as a checking account... The comingling of funds is an inappropriate business practice for collection of funds which do not belong to the entity'. The "main depository account" referenced in the report was used as a temporary pass= through account for restitution, fines and other fees collected on behalf of Monroe County. Funds collected were then segregated accordingly to non-interest bearing accounts titled "Monroe Restitution" and "Court Fees". Court Options never used these accounts for any operating purposes of any kind. Furthermore,Court Options provided Monroe with substantial supporting documentation which allowed the auditors to trace any and all restitution or court fee payments made by probationers from the temporary pass-through account to its designated restitution/ court fee account. Court Options has been in compliance with segregating and disbursing funds from the appropriate non-interest bearing accounts titled accordingly to its disbursement of"Court Fees" and "Restitution"since the execution of the Agreement. The only guidance provided within the Agreement regarding collection and maintenance of funds is paragraph 3.4.8 which states: • • • "The CONTRACTOR[i.e., Court Options]shall maintain fine, restitution, and/or court costs collected from the Probationers in an escrow account without the benefit or profit , from said accounts". The Agreement provides very little, if any, guidance on the maintenance of fines and restitution, nor does any portion of the Agreement address "comingling" of funds. Additionally,the statement "the comingling of funds is an inappropriate business practice" is based strictly on the opinion of the Monroe County auditors. Court Options requests that the language regarding"comingling" of funds be removed from Finding 2. III. Finding 3: "Court Options did not remit Court fees and fines payments from Probationers to the Clerk of Court in a timely manner". a. Monroe found that"the average number of days for a.payment to be wired to the Clerk - of Court was seven (7)working days".The sampled reports could have included federal, state and local holidays. For the most part,Court Options has adhered to the policy of 5 working days and had established from the onset of the contract of wiring funds directly to the Courts as requested. b. Monroe states that "Court Options said in their response to Monroe County's Request for Qualifications that they would deposit funds into the Court options bank account daily". This language was never included in the Agreement and should therefore be removed • from Finding 2. • IV. Finding 4: "Court Options did not distribute restitution payments to the Victims in a timely manner". • a. Monroe cites paragraph 4.3 in the Agreement and states that Court Options "is not in compliance with the intended purpose of the Agreement for Probation Services". The Agreement does not specify an acceptable amount of time that restitution payments should be made. Furthermore, no consideration was given by the auditors for instances in which no victim contact information (including addresses, phone numbers, etc.) was provided by the County attorney. Many victims' checks were returned for unknown address and•needed to be reissued. A delay in restitution payments was also caused by the State not providing a restitution disbursement sheet. The Court Options Probation Counselors audit each file on a weekly basis for all contractually required paperwork (which was provided to the auditors) with a copy of the "file checklist". The counselor would then contact the State for the required information and, depending on their response, order to distribute the funds to the victims. The 14 instances stated on this report that"Court Options combined multiple restitution payments and then issued a check to the Victim" was due to the delay of the information being provided by the State. Additionally,the 14 instances represent 1%of the victim disbursements made during the past 7 years. V. Finding 5: "There is a large amount of restitutionand refunded court fees in Court Options possession that needs to be distributed to the Victims or Probationers". a. Monroe cites paragraph 4.3 in the Agreement and states that Court Options "As of May 31, 2013 bank statement, there were... 237 stale checks totaling$32,860.67". On numerous occasions, Court Options has contacted the victim witness department of Monroe County concerning victims unable to be located and Court Options has done vigorous research through search engines as anywho.com,flcis.com, etc. to locate the victims, including contacting the victim with the last known phone number provided by the State. Ruben Valdivia has contacted the Monroe County offices to discuss the . outstanding monies in order to provide the victims with their monies. After numerous attempts to work with the sentencing court we have conferred with our legal counsel • who has advised us to send the uncollected funds to the State of Florida. Furthermore, the stale and outstanding checks were not immediately reissued if a valid address was not known or provided by the State. EXHIBIT • `'t'v201" FW:Wre in Transit-courtoptions.org-SmarterMail From: Gisel Desarden [mailto:gdesarden@courtoptions.org] Sent: Wednesday, December 05, 2012 2:38 PM To: 'Jackie Clynes' • Subject: Wire in Transit HI Jackie. The following wire will be delivered by this week, attached is the report for your review. The following is the breakdown 11.23.12-11.29.12 KW Court Fee $6,956.96 • KW CSFO $ 1,335.00 k1 Court Fee $ 2, 380.00 • PK Court Fee $ 3. 531.17 • • Tota I $ 14, 203.13 11.30.11.30.12 • KW Court Fee $ 446.00 KWCSBO $ 0.00 M Court Fee $ 745.00 • • PK Court Fee $ 2.93.00 Total $ 1, 484.00 1 ito.i,w ii I.cotirlopiloiu.org/tvlain/IrmtvlessagePrint.asprOpopup=true&messageid=2533&folder=lnbox&user=mportuondo&domain=courtoptons.org&»iapped= 2!3 ii,t920.14 FW.Wre in Transit-courtoptions.org-SmarterM ail • ( . -_ ( . * 11011 . • • (CI kinting Dept. Court Options, Inc. • 6555 NW 36 ST • Miami FL 33166 Tel 4: 305.870.9920 Ext. 105 • • Fax it: 305.870-9921 Cell #: 786-239-8260 Email: odesarclenrb)CourtOptions.orq . ClkilaStr This email is free from viruses and malware because avast! Antivirus r•-4, fill ww.:tv:INt.criin/1 (http://www.avast.comi) protection is active. Attachments: • I I-2.3-12 lhru 11-29-12.xls • 1 I-lin-I 2 thru 1 I 2.xls • htti firrnil I L,-ourtoptions.org/Main/frrnMessagePrint.aspOpopup=tr ue&mess ag eid=2533&folder=Inbox&user=mpor tuondo&dornai n=court opt i ons.org&mapped- 3/3 . 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