REPORT/RECOMMENDATION TO THE BOARD OF SUPERVISORS
OF SAN BERNARDINO COUNTY
AND RECORD OF ACTION
November 5, 2024
FROM
DEREK ARMSTRONG, Director, Economic Development
SUBJECT
Title
Agreement with IMPLAN Group LLC for the IMPLAN System Economic Modeling Platform
End
RECOMMENDATION(S)
Recommendation
Approve Terms and Conditions Agreement with IMPLAN Group LLC, including non-standard terms, to license use of the IMPLAN System economic modeling platform, in the amount of $10,800 for the contract period of November 5, 2024 through November 4, 2027
(Presenter: Derek Armstrong, Director, 387-4386)
Body
COUNTY AND CHIEF EXECUTIVE OFFICER GOALS & OBJECTIVES
Promote the Countywide Vision.
Create, Maintain and Grow Jobs and Economic Value in the County.
Improve County Government Operations.
Operate in a Fiscally-Responsible and Business-Like Manner.
Ensure Development of a Well-Planned, Balanced, and Sustainable County.
FINANCIAL IMPACT
Approval of this item will not result in the use of additional Discretionary General Funding (Net County Cost). The estimated cost of the 36-month agreement, which is a subscription agreement that includes license and system terms and conditions of use (Agreement), with IMPLAN Group LLC (IMPLAN) for the IMPLAN System is $10,800. Sufficient appropriation is included in the Economic Development (ED) 2024-25 budget and will be included in future recommended budgets.
BACKGROUND INFORMATION
ED is often asked for various types of local, regional and national information that may impact different economic development and County projects and programs. The IMPLAN System is an economic modeling platform that uses regional economic data to estimate economic impacts in the planning of construction projects. The IMPLAN System is a tool that will allow ED to collect, analyze and provide data as needed.
The Terms and Conditions (Agreement) is IMPLAN’s standard commercial contract, which includes terms that differ from the standard County contract and omits certain County standard contract terms. While the parties negotiated certain contract terms to County standard, IMPLAN would not agree to all County standard terms. The non-standard and missing terms include the following:
1. The Agreement is silent on governing law.
• The County standard contract requires California governing law.
• Potential Impact: Having no specified governing law in the Agreement results in uncertainty over which state’s laws will govern the interpretation of the Agreement and leads to ambiguity in the interpretation of the Agreement terms. IMPLAN is a Limited Liability Corporation registered and based in North Carolina. The Agreement could be interpreted under any state law depending on where the claim is brought, including North Carolina or California. Any questions, issues or claims arising under this Agreement could require the County to hire outside counsel competent to advise on the applicable state law, which may result in fees that exceed the total Agreement amount.
2. There is no provision in the Agreement addressing each party’s responsibility for paying attorneys’ fees.
• The County standard contract requires each party to bear its own costs and attorney fees, regardless of who is the prevailing party.
• Potential Impact: County Counsel cannot advise on, whether and to what extent, an any non-California state’s law may affect a party’s requirement to pay the prevailing party’s attorneys’ fees and costs in a legal action where no specific provision is provided in the Agreement.
3. IMPLAN’s maximum liability to the County is limited to the amount charged in the 6 months prior to the event giving rise to the claim, excluding gross negligence and willful misconduct, but including indemnification obligations.
• The County standard contract does not include a limitation of liability.
• Potential Impact: Claims could exceed the liability cap and the Agreement amount leaving the County financially liable for the excess.
4. Payment is due upon receipt of invoice, with a late payment interest penalty of 1%.
• County standard payment terms are Net 60 days with no interest or late payment penalties.
• Potential Impact: County standard processing time is 60 days or more. Failing to pay upon receipt of invoice may result in a material breach of the Agreement, which could allow IMPLAN to terminate the Agreement and seek other legal remedies, including charging the County interest at a rate of 1%, which could exceed the Agreement amount.
5. The County may not terminate the Agreement for convenience. In addition, the County agrees to a non-cancelable payment obligation and non-refundable fees.
• County Policy 11-05 requires that the County have the right to terminate the contract, for any reason, with a 30-day written notice of termination without any obligation other than to pay amounts for services rendered and expenses reasonably incurred prior to the effective date of termination.
• Potential Impact: The County can only terminate the Agreement during the term for an uncured breach by IMPLAN. Any attempted termination by County without cause could result in payment liability for the full Agreement amount, which could result in payment liability where no funds are available due to lack of allocation or loss of funding.
6. There is no stated venue in the Agreement.
• County Policy 11-05 requires venue for disputes in Superior Court of California, County of San Bernardino, San Bernardino District.
• Potential Impact: IMPLAN is located in North Carolina. Having no express venue in the Agreement means that North Carolina venue could be applied to disputes arising under this Agreement, which may result in additional expenses that exceed the amount of the Agreement.
Economic Development recommends approval of the Agreement with IMPLAN, including the non-standard terms. The Board of Supervisors approved a 1 year agreement for this software last year (Agreement No. 23-1187) . The department utilized the economic modeling platform to perform economic impact analysis internally, saving the County thousands of dollars on consulting firm fees. The department would like to continue utilizing the platform during the requested renewal period.
PROCUREMENT
Economic Development did a search for comparable economic impact systems. The IMPLAN System is commonly used by agencies in California and throughout the United States, including agencies such as the California Governor’s Office of Business and Economic Development (GOBiz) and the San Bernardino International Airport. The Purchasing Department concurs with the non-competitive justification of proprietary for the IMPLAN System for an economic modeling platform as this software meets the needs of the Economic Development Department.
REVIEW BY OTHERS
This item has been reviewed County Counsel (Bonnie Uphold, Supervising Deputy County Counsel, 387-5455) on October 7, 2024; Purchasing (Ariel Gill, Supervising Buyer, 387-2070) on October 4, 2024; Risk Management (Gregory Ustaszewski, Staff Analyst, 386-9008) on October 21, 2024; Innovation and Technology (Robert Pittman, Chief Information Security Officer, 388-5510) on October 7, 2024; Finance (Carl Lofton, Administrative Analyst, 387-5404) on October 18, 2024; and County Finance and Administration (Robert Saldana, Deputy Executive Officer, 387-5423) on October 21, 2024.
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