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May 25, 1990 <br />Ms, Mary Kueffner <br />City Administrator <br />3800 Laverne Ave, No <br />Lake Elmo, MN 55042 <br />Subject: [DPRA Contract and Rate Increase Request <br />Dear Mary: <br />The purpose of this letter is to respond to the request for new <br />labor rates by Chris Lough, Vice President, DPRA, in his letter <br />to you dated May 15, 1990, <br />The increasedlabor rates amounts to approximately a 7% increase, <br />This figure breaks down to 4% for cost -of -living and 3% for <br />performance. Increased rates for the subcontractor to DPRA, <br />Geraghty and Miller, are not included in this request. An increase <br />from Geraghty and Miller is not anticipated. <br />It is the recommendation of ReAPP that the labor rates be approved <br />as requested for two reasons. <br />First, our working relationship with DPRA has been excellent from <br />the start. Initially, we asked for relief from their normal profit <br />level and they complied. Also, contrary to normal business practices, <br />DPRA does not add a percentage increase to billings they receive from <br />Geraghty and Miller. Second, the performance of DPRA has met our <br />expectations. Their work is competent, professional and timely. <br />The new rates will increase the total cost for engineering services <br />by $2937.00 to $101,035.00, or an increase of 3%. Please see the <br />attached revised contract. Two points need to be made here. First, <br />since this figure now exceeds $100,000.00, there exists the possibil- <br />ity that funds from the appropriated $200,000.00 may have to be used <br />to cover that portion of engineering services exceeding $100,000.00. <br />Second, it may be possible, in the future, to delete or reduce in <br />size some parts of the engineering contract as shown. In either case, <br />these possibilities combined with the 10% contingency may provide <br />flexibility to reduce the total actual outlays for engineering services <br />to less than $100,000.00. Consequently, no monies would be needed from <br />the appropriated funds for engineering services. <br />We ask that this issue be put before the Lake Elmo City Council for the <br />June 5, 1990 meeting, and that the amended contract be executed by <br />appropriate individuals and forwarded to DPRA. <br />Todd Williams <br />cc: Chris Lough, DPRA <br />Dan Novak <br />