Item N18BOARD OF COUNTY COMMISSIONERS
AGENDA ITEM SUMMARY
ADD ON
Meeting Date: March 19, 2008 Division: COUNTY ATTORNEY
Bulk Item: Yes XX No
Staff Contact Person: Bob Shillinger, x3470
AGENDA ITEM WORDING: Approval of settlement agreement in the matter of South Florida
Employment and Training Consortium v. Agency for Workforce Innovation, DOAH case number 06-
4333 and payment of $22,988.57 to resolve that dispute.
ITEM BACKGROUND: The County, along with several other South Florida local governments,
entered into an agreement to create the South Florida Employment and Training Consortium (SFETC)
in 2004. Under the agreement, the local government entities agreed to contribute a pro-rata share to
resolve any liabilities that SFETC incurred for disallowed costs. In 2006, the Agency for Workforce
Innovation disallowed costs totaling $651,282.00 and demanded payment by the member entities for
that amount. After the SFETC and its members provided additional documentation, AWI reduced the
amount it was seeking to $343,688.00. Monroe County's portion of that debt is $22,988.57.
Fortunately, over $300,000.00 has been collected from providers who failed to provide sufficient
documentation of their services. That money is being held in a trust fund by the Miami -Dade Finance
Department. If all five local governments execute the agreement and pay their respective pro-rata
shares, that money will be redistributed to the consortium members at their respective pro-rata rates
which would bring approximately $20,000.00 back to Monroe County.
This item is being added on after the deadline because there is a hearing scheduled before DOAH on
April lst and 2nd and this agreement was finalized after the agenda deadline. If this agreement is not
executed by all five entities, it is possible but not probable that the hearing will be postponed. Once
this matter goes to hearing, the proposed deal is likely off the table and each local government entity,
including Monroe County, has an increased exposure for costs.
The Director of Community Services joins in the recommendation of legal staff.
PREVIOUS RELEVANT BOCC ACTION: Board agreed to enter into consortium in 2004.
CONTRACT/AGREEMENT CHANGES: n/a
STAFF RECOMMENDATIONS: Approval.
TOTAL COST: $343,688.00.
BUDGETED: Yes _ No xx
COST TO COUNTY: $22,988.57 SOURCE OF FUNDS: Ad valorem
REVENUE PRODUCING: Yes No x AMOUNT PER MONTH Year
APPROVED BY: County Atty _ OMB/Purchasing Risk Management
DOCUMENTATION: Included Not Required
DISPOSITION: AGENDA ITEM #
SETTLEMENT AGREEMENT
I. PARTIES
This Settlement Agreement ("Agreement') is entered into by, between, and among
Miami -Dade County, Monroe County, the City of Miami, the City of Hialeah, and the City of
Miami Beach, former member jurisdictions of the South Florida Employment and Training
Consortium ("SFETC") and the State of Florida Agency for Workforce Innovation ("the
Agency").
II. PREAMBLE
A. WHEREAS, Miami -Dade County, Monroe County, the City of Miami, the City
of Hialeah, and the City of Miami Beach entered into a Consortium Agreement effective
July 1, 2004 and expiring on June 30, 2006; and
B. WHEREAS, the aforesaid Consortium Agreement created the South Florida
Employment and Training Consortium ("SFETC'); and
C. WHEREAS, the Chief Elected Officials of the aforesaid former member
jurisdictions of the SFETC served as the Chief Elected Officials for Region 23 of the State
of Florida pursuant to the federal Workforce Investment Act of 1998 and state law; and
D. WHEREAS, Paragraph 11 of the aforesaid Consortium Agreement states:
11. Each member jurisdiction of the Consortium agrees to
promptly contribute to any SFETC liability incurred
under this Agreement as follows:
a. No liability shall be paid by any Consortium
member or by the SFETC unless ordered by a
court of competent jurisdiction or other superior
state or federal government entity or unless
otherwise agreed by affirmative vote of the
SFETC Board. The majority vote necessary to
approve payment of any financial claim or
financial liability shall include the vote of either
the City of Miami or Miami -Dade County to be
effective.
b. Costs and other expenses disallowed by the
state or federal government or by the
SFETC/SFW Boards with respect to contracts
between the SFETC/SFW Boards and an
individual Consortium member jurisdiction for the
provision of workforce services shall be paid by
and shall be the financial liability solely of the
same individual Consortium member jurisdiction.
C. Costs and other expenses disallowed with
respect to contracts between SFETC/SFW
Boards and any service providers or caused by
SFW staff errors shall be paid by and shall be
the financial liability of:
Miami -Dade County 42.2%
Miami, City of 33.3%
Hialeah, City of 11.1 %
Miami Beach, City of 6.7%
Monroe County 6.7%
TOTAL 100%
; and
E. WHEREAS, the Agency, a superior state governmental entity, sent a
Management Decision to the South Florida Workforce Board dated September 27, 2006,
pertaining to an audit of federal funds awarded through the Agency for the Year Ended
June 30, 2005, which states in pertinent part: "AWI has established a debt for the
disallowed costs associated with Finding CF 2005-6 in the amount of $651,282. This debt
must be repaid to AWI using a non -Federal funding source. We request that this payment
is made by December 31, 2006."; and
F. WHEREAS, Finding CF 2005-6 found unjustified prepaid transportation costs
in the amount of $651,282.00 for three programs: U.S. Department of Labor, passed
through the Agency, WIA Cluster; U.S. Department of Health and Human Services, passed
through the Agency, Temporary Assistance for Needy Families; U.S. Department of Health
and Human Services, passed through the Florida Department of Children and Families,
Refugee and Entrant Assistance Program; and
G. WHEREAS, the Agency determined that under OMB Circular A-133 Allowable
Costs/Cost Principles, costs must be documented in accordance with OMB Circular A-1 02
Common Rule for State, Local, and Indian Tribal Governments to a point where costs can
be determined to be allowable or not; and
H. WHEREAS, Section 29 U.S.C.A. 2832(3)(B)(i)(1) provides that the Chief
Elected Official(s) shall serve as the local grant recipient and shall be liable for any misuse
of the federal grant funds; and
I. WHEREAS, 20 CFR Section 667.705 provides that the grant recipient is
responsible for all federal funds under its grant(s) and that the political jurisdiction(s) of the
Chief Elected Official(s) is liable for any misuse of the grant funds allocated to the local
area; and
—2—
J. WHEREAS, the aforesaid former member jurisdictions of the SFETC have
provided to the Agency additional documentation related to the disallowed costs, and the
Agency has reviewed this documentation and determined that the aforesaid former
member jurisdictions of the SFETC have justified $307,594.00 of the disallowed costs.
III. TERMS AND CONDITIONS
NOW, THEREFORE, in consideration of mutual promises, covenants, and
obligations set forth below, and for good and valuable consideration as stated herein, the
parties agree as follows:
1. The aforesaid former member jurisdictions of the SFETC agree to repay the
amount of $343,688.00 in disallowed costs to the Agency, from a non-federal funding source
within thirty (30) days from the date of execution of this Settlement Agreement by all parties.
Along with the payment, the aforesaid former member jurisdictions of the SFETC shall provide
a schedule, which sets forth the grant, grant amount, and grant year for the repayment
costs of $343,688.00.
a. In accordance with Paragraph 11.b. of the Consortium Agreement, the
City of Hialeah shall pay the Agency For Workforce Innovation the sum of $575.00 from a
non-federal funding source not later than thirty (30) days from the date of execution of this
Settlement Agreement by all parties.
b. In accordance with Paragraph 11.c. of the Consortium Agreement,
Miami -Dade County shall pay the Agency For Workforce Innovation the sum of
$144,793.68 (derived by subtracting $575.00 from $343,688.00 and multiplying the
resulting sum of $343,113.00 by 42.2%) from a non-federal funding source not later than
thirty (30) days from the date of execution of this Settlement Agreement by all parties.
C. In accordance with Paragraph 11.c. of the Consortium Agreement, the
City of Hialeah shall pay the Agency For Workforce Innovation the sum of $38,085.54
(derived by subtracting $575.00 from $343,688.00 and multiplying the resulting sum of
$343,113.00 by 11.1 %) from a non-federal funding source not later than thirty (30) days
from the date of execution of this Settlement Agreement by all parties.
d. In accordance with Paragraph 11.c. of the Consortium Agreement, the
City of Miami shall pay the Agency For Workforce Innovation the sum of $114,256.62
(derived by subtracting $575.00 from $343,688.00 and multiplying the resulting sum of
$343,113.00 by 33.3%) from a non-federal funding source not later than thirty (30) days
from the date of execution of this Settlement Agreement by all parties.
e. In accordance with Paragraph 11.c. of the Consortium Agreement,
Monroe County shall pay the Agency For Workforce Innovation the sum of $22,988.57
(derived by subtracting $575.00 from $343,688.00 and multiplying the resulting sum of
$343,113.00 by 6.7%) from a non-federal funding source not later than thirty (30) days from
the date of execution of this Settlement Agreement by all parties.
-3-
f. In accordance with Paragraph 11.c. of the Consortium Agreement, the
City of Miami Beach shall pay the Agency For Workforce Innovation the sum of $22,988.57
(derived by subtracting $575.00 from $343,688.00 and multiplying the resulting sum of
$343,113.00 by 6.7%) from a non-federal funding source not later than thirty (30) days from
the date of execution of this Settlement Agreement by all parties.
2. The aforesaid former member jurisdictions of the SFETC and the Agency
acknowledge hereby that the U.S. Department of Labor and the U.S. Department of Health
and Human Services have the authority to demand repayment of misused federal funds from
the recipients of those funds. The aforesaid former member jurisdictions of the SFETC agree
that if either the U.S. Department of Labor or the U.S. Department of Health and Human
Services requires either the Agency or the aforesaid former member jurisdictions of the
SFETC to repay federal funds related to Final Management Decision Finding CF 2005-6, the
aforesaid former member jurisdictions of the SFETC shall fully indemnify the Agency for the
entire amount of such a repayment, to wit, the balance of $307,594.00.
3. The parties also acknowledge that U.S. Department of Labor or the U.S.
Department of Health and Human Services may require the repayment of prepaid
transportation costs in addition to the amount that is the subject of this Settlement Agreement.
If either the U.S. Department of Labor or the U.S. Department of Health and Human Services
requires either the Agency or the aforesaid former member jurisdictions of the SFETC to repay
these federal funds, the aforesaid former member jurisdictions of the SFETC will indemnify the
Agency for any disallowed costs attributable to SFETC.
4. Upon execution of this Settlement Agreement by all parties, the parties shall file
a Joint Notice of Settlement and Voluntary Dismissal of DOAH Case No. 06-4333.
5. The parties hereto stipulate and agree that this document represents the entire
agreement by, between, and among them and that the provisions contained herein may not be
changed or altered without the express written consent of all of the parties.
6. All of the parties hereto participated in the preparation of this stipulation and
Settlement Agreement, and in the process of preparation thereof, each and all of the parties
acknowledge hereby that each party was fully and adequately represented by its own
respective legal counsel and has received legal advice from its own respective legal counsel.
7. In the event of any litigation arising out of this Settlement Agreement, this
Settlement Agreement shall not be construed in favor of or against any party by reason of its
process of preparation.
8. All parties to this Settlement Agreement shall bear their own respective legal
costs and attorney's fees, if any, with respect to the preparation and execution of this
Settlement Agreement and DOAH Case No. 06-4333.
9. This Settlement Agreement shall be effective on the date of signature of the
last signatory to this Settlement Agreement ("Effective Date"), to wit, the date that all of the
—4—
parties hereto have executed this Settlement Agreement. Facsimiles of signatures shall
constitute acceptable, binding signatures for purposes of this Settlement Agreement. This
Settlement Agreement shall be signed in counter -part originals by each and all of the
parties hereto and each such counter -part original shall be deemed an original for all
purposes. Each such counter -part original of each and all of the aforesaid former members
of the SFETC shall be executed by the duly authorized respective Chief Elected Official of
the aforesaid former member jurisdictions of the SFETC.
—5—
IN WITNESS HEREOF, THE CHIEF ELECTED OFFICIALS AND THE
AGENCY HAVE EXECUTED THIS AGREEMENT:
FORMER MEMBER JURISDICTIONS OF THE
SOUTH FLORIDA TRAINING AND EMPLOYMENT CONSORTIUM
DATED: BY:
DATED: BY:
DATED: BY:
DATED: BY:
DATED: BY:
Miami -Dade County
Mayor
Miami -Dade County
Approved as to form and legal sufficiency by
County Attorney
Monroe County
Mayor
Monroe County
Approved as to form d le al y
County Attorney /
City of Miami
Mayor
City of Miami
Approved as to form and legal sufficiency by
City Attorney
City of Hialeah
Mayor
City of Hialeah
Approved as to form and legal sufficiency by
City Attorney
City of Miami Beach
Mayor
City of Miami Beach
Approved as to form and legal sufficiency by
City Attorney
AGENCY FOR WORKFORCE INNOVATION
DATED: BY:
BARBARA K. GRIFFIN, DEPUTY DIRECTOR
Agency for Workforce Innovation
Approved as to form and legal sufficiency.
KIMBERLY SISKO WARD, DEPUTY GENERAL COUNSEL
—7—
From: Tell, Peter (CAO) [mailto:TELLP@miamidade.gov]
Sent: Tuesday, March 11, 2008 1:25 PM
To: Curry, Cynthia W. (CEO); darosemond@ci.miami.fl.us; Barsell-Debbie; Marinelli, Frederick H.
[HF]; Inguanzo, Ramiro
Cc: Rick Beasley; Ward, Kimberly S.; KRMenendez@miamigov.com; Shillinger-Bob;
wgrodnick@hialeahfl.gov; yarilysam@miamibeachfl.gov; YamIlexMorales@miamibeachfl.gov;
steverothstein@miamibeachfl.gov; Gustavo Alonso; Christine Garcia; Padron, Blanca (FIN)
Subject: Settlement Agreement -DOAH Case No. 06-4333- Unjustified Prepaid Transportation
Costs-SFETC Liability to State of Florida AWI
Attached please find a Settlement Agreement for execution by the respective Mayors of each and
all of the five former member jurisdictions of the South Florida Employment and Training
Consortium. This Settlement Agreement has been approved by me for form and legal sufficiency
for my client, Miami -Dade County, and has been approved by Kimberly Ward, Deputy General
Counsel, State of Florida AWI. Please transmit this Settlement Agreement to your respective
Mayors for execution as soon as possible. The administrative hearing in the above -styled DOAH
Hearing has been continued only until April 1, 2, 2008. Therefore, time is of the essence. I have
included on this a mail distribution the respective legal counsel of Monroe County, City of Miami,
City of Miami Beach and City of Hialeah so that you can obtain independent legal advice since
the Miami -Dade County Attorneys Office only represents Miami -Dade County and not the other
four former member jurisdictions of the South Florida Employment and Training Consortium.
1) If you have questions regarding the financial aspects of this Settlement Agreement
please call Rick Beasley, Executive Director, South Florida Workforce Investment Board
at 305-594-7615.
2) If there are legal questions from respective legal counsel please contact me at 305-375-
1024.
3) Since it is extremely unlikely that I will be able to get another Agreed Continuance of the
DOAH hearing above referenced I will need some documentation (e mail explanation)
from you if you are not going to be able to process this Settlement Agreement and obtain
the execution of same by your respective Mayor by the last week of March. With such an
e mail explanation I may be able to convince the State AWI to agree to another
continuance until the first week in May for the DOAH hearing. (The pendency of the
DOAH proceeding automatically stays the required payment) As I have indicated in prior
e mails, if the matter is not settled as proposed herein and appears to be going to a
DOAH hearing on April 1, 2, 2008, then I will be filing a voluntary dismissal on behalf of
Miami -Dade County in the DOAH hearing prior to such hearing dates to protect my
client, Miami -Dade County, from having to pay costs and attorneys fees to State AWI.
The other four former member jurisdictions by and through their respective attorneys will
have to deal with that DOAH hearing and the potential liability for costs and attorneys
fees for their respective jurisdictions if the Settlement Agreement is not consummated or
file voluntary dismissals on behalf of their respective jurisdictions prior to April 1,2, 2008.
Please note that payment to the State AWI must be from a non-federal funding source.
4) As of March 3, 2008, Miami -Dade County Finance Department Trust Fund
643TSF/643001 has $305,077.50 in monies recovered and collected by Miami -Dade
County staff ( Rick Beasley and his able staff) from the numerous service providers
whose prepaid transportation costs remained unjustified. As you will note from the
Settlement Agreement Hialeah was a service provider and $575.00 remained unjustified.
Interest earned on the sum of $305,077.50 through and including March 3, 2008 was
$7433.40. After this Settlement Agreement is executed by all of the Mayors and after all
of the monies are paid to the State AWI to the satisfaction of the State AWI, I will be
sending you a second proposed agreement to release and disburse the aforesaid Trust
Fund monies in accordance with the same percentages of liability set forth in the
Consortium Agreement. Upon execution by the five Mayors of this second subsequent
agreement I will instruct the Miami -Dade County Finance Department to disburse the
monies accordingly. It is not anticipated that any more monies will in all likelihood be
collected or recovered. The interest aforementioned is considered program income by
State AWI pursuant to federal regulations and upon disbursal of the res of the Trust Fund
to the five former member jurisdictions as above referenced the interest accrued to date
will be transmitted to State AWI minus the $100 administrative cost expense to be paid to
Miami -Dade County Finance Department per federal regulations.
Peter S. Tell
Assistant County Attorney
Miami -Dade County
111 N.W. First Street, Suite 2800
Miami, Florida 33128
Tel-305-375-1024
Fax-305-375-5611
e-mail: tellp@miamidade.gov