HomeMy WebLinkAboutNorthwest Municipal Advisors - PSA Debt BookPERSONAL SERVICES AGREEMENT
NORTHWEST MUNICIPAL ADVISORS
THIS AGREEMENT is entered by and between the City of Pasco and Northwest
Municipal Advisors Inc. referred to as Consultant for the purpose of contracting for personal
services in the capacity as municipal advisory services related to capital planning and funding for
the City.
RECITALS
WHEREAS, the City desires to have certain services and/or tasks performed as set forth
below requiring specialized skills, training, equipment, and other supportive capabilities; and
WHEREAS, the Consultant represents that it is qualified and possesses sufficient skills,
experience, equipment, and necessary capabilities, including: technical and professional expertise,
when required, to perform the services and/or tasks as set forth in this Agreement upon which the
City is relying.
NOW, THEREFORE, in consideration of the mutual covenants, and performances
contained herein, the parties agree as follows:
1. Scope of Services. The Consultant shall perform such services and accomplish such tasks,
including the furnishing of all labor, materials, facilities, and equipment necessary for full
performance thereof, as identified and designated as Consultant's Responsibilities
throughout this Agreement, and as more particularly described in Scope of Work detailed
in Exhibit A, attached hereto, and incorporated herein (the "Project").
2. Term. This Project shall begin on the execution date listed above and promptly be
completed by December 31, 2023.
3. Compensation and Payment.
3.1 Payment for services provided hereunder shall be made following the performance
of such services. Such payment shall be full compensation for work performed or
services rendered, and for all labor, materials, supplies, equipment, and incidentals
necessary to complete the Project.
3.2 No payment shall be made for any services rendered by the Consultant except for
services identified and set forth in this Agreement except as may be authorized by
a written supplemental agreement approved by the City.
3.3 The City shall pay the Consultant for work performed under this Agreement upon
timely submitted invoices detailing work performed and expenses for which
reimbursement is sought. The City shall approve all invoices before payment is
issued. Payment shall occur within thirty (30) days of receipt and approval of an
invoice.
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3.4 The City shall pay the Consultant for all work performed and expenses incurred
under this Agreement, as follows.
® Other: Such rates as identified on Exhibit A, plus actual expenses incurred
as provided under this Agreement, but not to exceed amount outlined below
per debt issuance without the prior written authorization by the City.
(a) Fire Station 85 debt issuance: $20,000
(b) East UGA Sewer LID Bond Anticipation Note: $30,000
(c) Waterworks Utility debt issuance, tax exempt: $30,000
(d) Waterworks Utility debt issuance, taxable: $20,000
(e) Broadmoor Transportation — Tax Increment Finance: $30,000
4. Reports and Inspections.
4.1 The Consultant at such times and in such forms as the City may require, shall
furnish to the City such statements, records, studies, surveys, reports, data, and
information as the City may request pertaining to matters covered by this
Agreement.
4.2 The Consultant shall, at any time during normal business hours and as often as the
City or the Washington State Auditor may reasonably deem necessary, make
available for examination all of its records and data with respect to all matters
covered, directly or indirectly, by this Agreement and shall permit the City, or its
designated authorized representative to audit and inspect other data relating to all
matters covered by this Agreement. The City shall receive a copy of all audit
reports made by the agency or firm as to the Consultant's activities. The City may,
at its discretion, conduct an audit at its expense, using its own or outside auditors,
of the Consultant's activities which relate, directly or indirectly, to this Agreement.
Consultant shall be provided a copy of such reports.
4.3 The Consultant, during the term of this Agreement, shall obtain all permits and
registration documents necessary for the performance of its work and for the
execution of services at its own expense, and shall maintain its validity. Upon
request, the Consultant shall deliver to the City copies of these licenses, registration
documents, and permits or proof of their issuance or renewal.
4.4 Consultant shall maintain books, records, and documents, which sufficiently and
properly reflect all direct and indirect costs related to the performance of this
Agreement and shall maintain such accounting procedures and practices as may be
necessary to assure proper accounting of all funds paid pursuant to this Agreement.
These records shall be subject, at all reasonable times, to inspection, review, or
audit as provided above.
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4.5 The Consultant shall retain all books, records, documents, or other material relevant
to this Agreement for three (3) years after its expiration. Consultant agrees that the
City, or its designee, shall have full access and right to examine any of said
materials at all reasonable times during this period.
5. Ownership and Use of Documents.
5.1 All research, tests, surveys, preliminary data, information, drawings, and
documents made, collected, or prepared by the Consultant for performing the
services subject to this Agreement, as well as any final product, collectively
referred to as "work product," shall be deemed as the exclusive property of the City,
including copyright as secured thereon. Consultant may not use them except in
connection with the performance of the services under this Agreement or with the
prior written consent of the City. Any prior copyrighted materials owned by the
Consultant and utilized in the performance of the services under this Agreement, or
embedded in with the materials, products and services provided thereunder, shall
remain the property of the Consultant subject to a license granted to the City for
their continued use of the products and services provided under this Agreement.
Any work product used by the Consultant in the performance of these services,
which it deems as "confidential," "proprietary," or a "trade secret" shall be
conspicuously designated as such.
5.2 In the event of Consultant's default, or if this Agreement is terminated prior to its
completion, the work product of the Consultant, along with a summary of the
services performed to date of default or termination, shall become the property of
the City, and tender of the work product and summary shall be a prerequisite to
final payment under this Agreement. The summary of services provided shall be
prepared at no additional cost if the Agreement is terminated through default by the
Consultant. If the Agreement is terminated through convenience by the City, the
City agrees to pay Consultant for the preparation of the summary of services
provided.
6. Public Records.
6.1 Consultant acknowledges that the City is an agency subject to Chapter 42.56 RCW
"Public Records Act." All preliminary drafts or notes prepared or gathered by the
Consultant, and recommendations of the Consultant are exempt prior to the
acceptance by the City or public citation by the City in connection with City action.
6.2 If the Consultant becomes a custodian of public records of the City and request for
such records is received by the City, the Consultant shall respond to the request by
the City for such records within five (5) business days by either providing the
records, or by identifying in writing the additional time necessary to provide the
records with a description of the reasons why additional time is needed. Such
additional time shall not exceed twenty (20) business days unless extraordinary
good cause is shown.
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6.3 In the event the City receives a public records request for protected work product
of the Consultant within its possession, the City shall, prior to the release of any
protected work product or as a result of a public records request or subpoena,
provide Consultant at least ten (10) business days prior written notice of the pending
release and to reasonably cooperate with any legal action which may be initiated
by the Consultant to enjoin or otherwise prevent such release.
7. Independent Contractor Relationship.
7.1 The parties intend that an independent contractor relationship is created by this
Agreement. The City is interested primarily in the results to be achieved; subject
to the scope of services and the specific requirements of this Agreement, the
implementation of services will lie solely with the discretion of the Consultant. No
agent, employee, officer, or representative of the Consultant shall be deemed to be
an employee, agent, officer, or representative of the City for any purpose, and the
employees of the Consultant are not entitled to any of the benefits or privileges the
City provides for its employees. The Consultant will be solely and entirely
responsible for its acts and for the acts of its agents, employees, officers,
subcontractors, or representatives during the performance of this Agreement.
7.2 In the performance of the services provided in this Agreement, Consultant is an
independent contractor with full authority to control and direct the performance of
the details of the work, however, the results of the work contemplated herein must
meet the approval of the City and shall be subject to the City's general rights of
inspection and review to secure the satisfactory completion thereof.
7.3 The Consultant shall comply with all State and Federal laws including, but not
limited to:
7.3.1 The definition requirements of RCW 50.04.140 (Employment Security).
7.3.2 RCW 51.08.195 (Industrial Insurance).
7.3.3 Obtain a City of Pasco business license.
7.4 The City may, at its sole discretion, require the Consultant to remove any employee,
agent, or servant from employment on this Project who, in the City's sole
discretion, may be detrimental to the City's interest.
7.5 Consultant as an independent contractor and not an employee shall not be entitled
to any employee benefits including but not limited to vacation time, sick leave, paid
time off, or paid holidays.
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8. Indemnification.
8.1 The Consultant shall defend, indemnify, and hold harmless the City, its officers,
officials, employees, and volunteers harmless from any and all claims, injuries,
damages, losses, or suits including attorney fees, arising out of or resulting from
the acts, errors or omissions of the Consultant in performance of this Agreement,
except for injuries and damages caused by the sole negligence of the City.
8.2 However, should a court of competent jurisdiction determine that this Agreement
is subject to RCW 4.24.115, then, in the event of liability for damages arising out
of bodily injury to persons or damages to property caused by or resulting from the
concurrent negligence of the Consultant, and the City, its officers, officials,
employees, and volunteers, the Consultant's liability, including the duty and cost
to defend, hereunder shall be only to the extent of the Consultant's negligence. It is
further specifically and expressly understood that the indemnification provided
herein constitutes the Consultant's waiver of immunity under Industrial Insurance,
Title 51 RCW, solely for purposes of this indemnification. This waiver has been
mutually negotiated by the parties. The provisions of this section shall survive the
expiration or termination of this Agreement.
8.3 No liability shall attach to the City by reason of entering into this Agreement except
as expressly provided herein.
8.4 This indemnification shall include damages, penalties and attorney fees caused by
Consultant's delayed or failed performance of Section 6 above.
9. Insurance. The Consultant shall procure and maintain for the duration of the Agreement,
insurance against claims for injuries to persons or damage to property which may arise
from or in connection with the performance of the work hereunder by the Consultant, its
agents, representatives, employees, or subcontractors. The Consultant's maintenance of
insurance as required by the Agreement shall not be construed to limit the liability of the
Consultant to the coverage provided by such insurance, or otherwise limit the City's
recourse to any remedy available at law or in equity.
9.1 Minimum Scope of Insurance. Consultant shall obtain insurance of the types and
coverage described below:
9.1.1 Automobile Liability insurance covering all owned, non -owned, hired, and
leased vehicles. Coverage shall be at least as broad as Insurance Services
Office (ISO) form CA 00 01.
9.1.2 Commercial General Liability insurance shall be at least as broad as ISO
occurrence form CG 00 01 and shall cover liability arising from premises,
operations, stop -gap independent contractors, and personal injury and
advertising injury. The City shall be named as an additional insured under
the Consultant's Commercial General Liability insurance policy with
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respect to the work performed for the City using an additional insured
endorsement at least as broad as ISO endorsement form CG 20 26.
9.1.3 Workers' Compensation coverage as required by the Industrial Insurance
laws of the State of Washington.
9.1.4 Professional Liability insurance appropriate to the Consultant's profession.
9.2 Minimum Amounts of Insurance. Consultant shall maintain the following
insurance limits:
9.2.1 Automobile Liability insurance with a minimum combined single limit for
bodily injury and property damage of $1,000,000 per accident.
9.2.2 Commercial General Liability insurance shall be written with limits no less
than:
® $1,000,000 each occurrence; and
® $2,000,000 general aggregate.
9.2.3 Professional Liability insurance shall be written with limits no less than:
® $1,000,000 per claim; and
® $1,000,000 policy aggregate limit.
9.3 Other Insurance Provision. The Consultant's Automobile Liability and
Commercial General Liability insurance policies are to contain or be endorsed to
contain that they shall be primary insurance as respect the City. Any insurance, self-
insurance, or self -insured pool coverage maintained by the City shall be excess of
the Consultant's insurance and shall not contribute with it.
9.3.1 The Consultant's insurance shall be endorsed to state that coverage shall not
be cancelled by either party, except after thirty (30) days prior written notice
by certified mail, return receipt requested, has been given to the City.
9.4 Acceptability of Insurers. Insurance is to be placed with insurers with a current
A.M. Best rating of not less than A: VII.
9.5 Verification of Coverage. Consultant shall furnish the City with original certificates
and a copy of the amendatory endorsements, including, but not necessarily limited
to, the additional insured endorsement, evidencing the insurance requirements of
the Agreement before commencement of the work.
9.6 Notice of Cancellation. The Consultant shall provide the City with written notice
of any policy cancellation within two (2) business days of their receipt of such
notice.
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9.7 City Full Availability of Consultant Limits. If the Consultant maintains higher
insurance limits than the minimums shown above, the City shall be insured for the
full available limits of Commercial General and Excess or Umbrella liability
maintained by the Consultant, irrespective of whether such limits maintained by the
Consultant are greater than those required by this Agreement or whether any
certificate of insurance furnished to the City evidences limits of liability lower than
those maintained by the Consultant.
9.8 Failure to Maintain Insurance. Failure on the part of the Consultant to maintain the
insurance as required shall constitute a material breach of contract, upon which the
City may, after giving five (5) business days notice to the Consultant to correct the
breach, immediately terminate the Agreement or, at its discretion, procure or renew
such insurance and pay any and all premiums in connection therewith, with any
sums so expended to be repaid to the City on demand, or at the sole discretion of
the City, offset against funds due the Consultant from the City.
10. Nondiscrimination. In the performance of this Agreement, the Consultant will not
discriminate against any employee or applicant for employment on the grounds of race,
creed, color, national origin, sex, marital status, age, or the presence of any sensory, mental,
or physical handicap; provided that the prohibition against discrimination in employment
because of handicap shall not apply if the particular disability prevents the proper
performance of the particular worker involved. The Consultant shall ensure that applicants
are employed, and that employees are treated during employment in the performance of
this Agreement without discrimination because of their race, creed, color, national origin,
sex, marital status, age, or the presence of any sensory, mental, or physical handicap.
Consultant shall take such action with respect to this Agreement as may be required to
ensure full compliance with local, State and Federal laws prohibiting discrimination in
employment.
11. Covenant Against Contingent Fees. The Consultant warrants that it has not employed
nor retained any company, firm, or person, other than a bona fide employee working
exclusively for the Consultant, to solicit or secure this Agreement; and that it has not paid
or agreed to pay any company, person or firm, other than a bona fide employee working
exclusively for the Consultant, any fee, commission, percentage, brokerage fee, gift, or
other consideration contingent upon or resulting from the award or making of this
Agreement. For breach or violation of this warranty, the City shall have the right to
terminate this Agreement.
12. Assignment and Subcontracting.
12.1 The City has awarded this Agreement to the Consultant due to its unique
qualifications to perform these services. The Consultant shall not assign (or
subcontract other than as specifically identified in Exhibit A) its performance under
this Agreement or any portions of this Agreement without the prior written consent
of the City, which consent must be sought at least thirty (30) days prior to the date
of any proposed assignment.
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12.2 Any work or services assigned or subcontracted hereunder shall be subject to each
provision of this Agreement including Section 6, Public Records; Section 10,
Nondiscrimination; proper bidding procedures where applicable; and all local, State
and Federal statutes, ordinances, and guidelines.
12.3 Any technical or professional service subcontract not listed in this Agreement, must
have prior written approval by the City.
13. Termination.
13.1 Termination for Convenience. Either party may terminate this Agreement for any
reason upon giving the other parry no less than ten (10) business days written notice
in advance of the effective date of such termination.
13.2 Termination for Cause. If the Consultant fails to perform in the manner called for
in this Agreement, or if the Consultant fails to comply with any other provisions of
this Agreement and fails to correct such noncompliance within five (5) business
days of written notice thereof, the City may terminate this Agreement for cause.
Termination shall be affected by serving a notice of termination on the Consultant
setting forth the manner in which the Consultant is in default. The Consultant will
only be paid for services and expenses complying with the terms of this Agreement,
incurred prior to termination.
14. General Provisions.
14.1 For the purpose of this Agreement, time is of the essence.
14.2 Notice. Notice provided for in this Agreement shall be sent by:
14.2.1 Personal service upon the Project Administrators; or
14.2.2 Certified mail to the physical address of the parties, or by electronic
transmission to the e-mail addresses designated for the parties below.
14.3 The Project Administrator for the purpose of this Agreement shall be:
14.3.1 For the City: Darcy Buckley, or his/her designee
525 N 3rd Ave
Pasco, WA 99301
buckleyd@pasco-wa. gov
14.3.2 For the Consultant: Scott Bauer, or his/her designee
11900 NE First Street, Suite 300
Bellevue, WA 98005
Scott@nwmunicipaladvisors.com
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15. Dispute Resolution.
15.1 This Agreement has been and shall be construed as having been made and entered
into and delivered within the State of Washington and it is agreed by each party
hereto, that this Agreement shall be governed by the laws of the State of
Washington.
15.2 In the event of a dispute regarding the enforcement, breach, default, or
interpretation of this Agreement, the Project Administrators, or their designees,
shall first meet in a good faith effort to resolve such dispute. In the event the dispute
cannot be resolved by agreement of the parties, said dispute shall be resolved by
arbitration pursuant to RCW 7.04A, as amended, with both parties waiving the right
of a jury trial upon trial de novo, with venue placed in Pasco, Franklin County,
Washington. The substantially prevailing party shall be entitled to its reasonable
attorney fees and costs as additional award and judgment against the other.
16. Nonwalver. Waiver by the City of any provision of this Agreement or any time limitation
provided for in this Agreement shall not constitute a waiver of any other similar event or
other provision of this Agreement.
17. Integration. This Agreement between the parties consists in its entirety of this document
and any exhibits, schedules, or attachments. Any modification of this Agreement or change
order affecting this Agreement shall be in writing and signed by both parties.
18. Authorization. By signature below, each party warrants that they are authorized and
empowered to execute this Agreement binding the City and the Consultant respectively.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed on the
date first written above.
CITY OF PA CO, WAS NGTON
Adam R. Lincoln, Interim City Manager
Inc.
A EST:
Debra C. Barham, City Clerk
APPROVED AS TO CORM
Kerr Fergusoi , 1 1:C, City Attorneys
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A/VNORTHWEST
MUNICIPAL ADVISORS
11900 NE 151 Street, Suite 300 Bellevue, Washington 98005
March 23, 2023
Ms. Darcy Buckley
Finance Director
City of Pasco
525 N. 3'd Avenue
Pasco, Washington 99301
Re: ENGAGEMENT LETTER FOR MUNICIPAL ADVISORY SERVICES
Dear Ms. Buckley:
This letter and proposal specifies the terms of the engagement between Northwest Municipal Advisors and the City
of Pasco (the "City") for municipal advisory services related to capital planning and funding for the City. If acceptable
to the City, this engagement shall become effective upon acceptance by the City.
INTRODUCTION TO NORTHWEST MUNICIPAL ADVISORS
Northwest Municipal Advisors ("NWMA") is a municipal advisory firm that specializes in assisting public entities
finance projects. We have significant experience in general government and special purpose district financing.
As a firm we do not sell or underwrite securities or bonds but only serve in an advisory role. This allows us to avoid
a potential conflict of interest in providing advice to a bond issuer.
NWMA is a registered Municipal Advisor with the Securities and Exchange Commission ("SEC") and the Municipal
Securities Rulemaking Board ("MSRB"). As such, NWMA has a fiduciary duty to our clients and shall act and provide
advice in a manner it believes to be in the best interest of its clients.
As municipal advisor, our most important responsibility is to provide sound advice to our clients, and our preference
is to be involved in all aspects of a financing, ranging from up -front planning and identification of financing options
to the actual sale, pricing and closing of a bond issue or other financing. We work with most of the bond counsel
and underwriter firms in the Northwest, with national underwriting firms, with regional and national banking
institutions, and with the bond rating agencies.
Our firm includes three professionals and support staff. Scott Bauer and Ryan Neumeister will be the primary
contacts on any financing, with back-up from Malinda Okerlund.
SCOPE OF SERVICES
NWMA will serve as municipal advisor for the City's financing needs and provide the following services:
• Consult with the City in determining the amount of borrowing, bond structure and the timing of any bond
sale financing. This analysis will take into account current and future capital requirements, adequate levels
of City reserves, interest rates and reinvestment rates, among other things. We will advise the City on
whether or not to proceed with any financing.
• Recommend to the City whether a borrowing should be completed through a bank loan, a public issuance
of bonds or other method. If a public issuance of bonds, recommend a negotiated or competitive sale
process.
• If a negotiated sale is appropriate, assist the City in selecting an underwriter for the financings.
• Attend financing meetings as appropriate and assist in facilitating the business aspects of such meetings.
• Review the City's outstanding debt and update the City, as appropriate, on refunding opportunities.
• Assume overall coordination of any financing, including developing time schedules, ensuring that
documents are available on a timely basis and keeping the City up-to-date on the bond market and any
changes that could affect the financing timeline.
• If issued through a public bond sale, prepare and coordinate rating presentations for the bonds.
• Review all documents related to the issuance of any bonds and provide the City and bond counsel with
comments and recommendations as appropriate.
• Perform analytical work and provide other advice and recommendations associated with the issuance of
bonds, as requested by the City.
• Meet with the City's Council, management and staff as requested.
• If issued through a public bond sale, represent the City during pricing of the bonds and advise and inform
the City as to the reasonableness of the structure and terms of the bonds and the fairness and
reasonableness of the pricing offered by the underwriter, as of the sale date of the bonds. We will
recommend whether or not to accept the underwriter's offer to purchase the bonds.
• If acting in the capacity of an Independent Registered Municipal Advisor ("IRMA") with regard to the IRMA
exemption of the SEC Rule, NWMA will review all third -party recommendations submitted to NWMA in
writing by the City.
• Provide such other related services as requested by the City.
From time to time, NWMA may provide non -municipal advisory services, including but not limited to:
• For bank loans, assist the City in selecting a bank for the financings.
FEES AND CHARGES
For bond/loan financings where we have primary responsibility for coordinating the financing and structuring the
issue, the fee schedule would be up to the following amounts for each issue:
• For issues up to $20 million, $1.25 per $1,000 par amount, with a minimum fee of $17,500.
• For issues from $20 million to $40 million, $25,000 plus $1.00 per $1,000 par amount over $20 million.
• If the City issues a bond/loan exceeding $40 million, we will provide a separate compensation proposal.
Fees calculated on the above schedule shall be adjusted as follows:
• NWMA will be reimbursed for direct out-of-pocket expenses. These expenses may include, but are not
limited to, mileage, travel expenses, printing, conference calls, and other.
• For special projects or assignments, NWMA will work with the City to define a scope of service and will
negotiate a fixed fee or hourly compensation (at the City's option) prior to any work being commenced. If
the City selects hourly compensation, we bill (per hour) $300 for principals and $200 for municipal advisors.
FIDUCIARY DUTY
NWMA is registered as a Municipal Advisor with the SEC. As such, NWMA has a fiduciary duty to the City and must
provide both a Duty of Care and a Duty of Loyalty that entails the following.
Duty of Care
a) Exercise due care in performing its municipal advisory activities.
b) Possess the degree of knowledge and expertise needed to provide the City with informed advice.
c) Make a reasonable inquiry as to the facts that are relevant to the City's determination as to whether to
proceed with a course of action or that form the basis for any advice provided to the City.
2
d) Undertake a reasonable investigation to determine that NWMA is not forming any recommendation on
materially inaccurate or incomplete information; NWMA must have a reasonable basis for:
Any advice provided to or on behalf of the City;
Any representations made in a certificate that NWMA signs that will be reasonably foreseeably
relied upon by the City, any other party involved in the municipal securities transaction or
municipal financial product, or investors in the City securities; and
iii. Any information provided to the City or other parties involved in the municipal securities
transaction in connection with the preparation of an official statement.
Duty of Loyalty
NWMA must deal honestly and with the utmost good faith with the City and act in the City's best interests without
regard to the financial or other interests of NWMA. NWMA will eliminate or provide full and fair disclosure (included
herein) to the City about each material conflict of interest (as applicable). NWMA will not engage in municipal
advisory activities with the City as a municipal entity if it cannot manage or mitigate its conflicts in a manner that
will permit it to act in the City's best interests.
MUNICIPAL SECURITIES RULEMAKING BOARD RULE G-10 DISCLOSURE
Pursuant to Municipal Securities Rulemaking Board Rule G-10, on Investor and Municipal Advisory Client Education
and Protection, Municipal Advisors are required to provide certain written information to their municipal entity and
obligated person clients which include the following:
• NWMA is currently registered as a Municipal Advisor with the U.S. Securities and Exchange Commission and
the Municipal Securities Rulemaking Board.
• Within the Municipal Securities Rulemaking Board ("MSRB") website at www.msrb.ora, the City may obtain
the Municipal Advisory client brochure that is posted on the MSRB website. The brochure describes the
protections that may be provided by the MSRB Rules along with how to file a complaint with financial
regulatory authorities.
CONFLICTS OF INTEREST AND OTHER MATTERS REQUIRING DISCLOSURES
• As of the date of the Agreement, except as disclosed below, NWMA is not aware of actual or potential
conflicts of interest that NWMA that might impair its ability to render unbiased and competent advice or
to fulfill its fiduciary duty, except as discussed. If NWMA becomes aware of any other potential conflict of
interest that arise after this disclosure, NWMA will disclose the detailed information in writing to the City
in a timely manner.
NWMA represents that in connection with the issuance of municipal securities, NWMA may receive
compensation from an Issuer or Obligated Person for services rendered, which compensation is contingent
upon the successful closing of a transaction and/or is based on the size of a transaction. Consistent with
the requirements of MSRB Rule G-42, NWMA hereby discloses, that such contingent and/or transactional
compensation may present a potential conflict of interest regarding NWMA's ability to provide unbiased
advice to enter into such transaction. This potential conflict of interest will not impair NWMA's ability to
render unbiased and competent advice or to fulfill its Fiduciary Duty to the City.
NWMA fees under this agreement are also based on hourly fees of NWMA's personnel, with the aggregate
amount equaling the number of hours worked by such personnel multiplied by an agreed -upon hourly
billing rate. This form of compensation presents a potential conflict of interest because it could create an
incentive for NWMA to recommend alternatives that would result in more hours worked. This conflict of
interest will not impair NWMA's ability to render unbiased and competent advice or to fulfill its Fiduciary
Duty to the City.
NWMA serves a wide variety of other clients that may from time to time have interests that could have a
direct or indirect impact on the interests of another NWMA client. For example, NWMA serves as municipal
advisor to other municipal advisory clients and, in such cases, owes a fiduciary duty to such other clients
just as it does to the City. These other clients may, from time to time and depending on the specific
circumstances, have competing interests. In acting in the interests of its various clients, NWMA could
potentially face a conflict of interest arising from these competing client interests. NWMA fulfills its
fiduciary duty and mitigates such conflicts through dealing honestly and with the utmost good faith with
City.
• It should be noted that NWMA's intention is to keep its work for each of its clients separate, and to maintain
confidentiality relative to each client, except for information which is clearly public information.
• NWMA does not act as principal in any of the transactions related to this Agreement.
• NWMA does not have any affiliate that provides any advice, service, or product to or on behalf of the client
that is directly or indirectly related to the municipal advisory activities to be performed by NWMA.
• NWMA has not made any payments directly or indirectly to obtain or retain the City's municipal advisory
business.
• NWMA has not received any payments from third parties to enlist NWMA recommendation to the City of
its services, any municipal securities transaction or any municipal finance product.
• NWMA has not engaged in any fee -splitting arrangements involving NWMA and any provider of
investments or services to the City.
• NWMA does not have any legal or disciplinary event that is material to the City's evaluation of the municipal
advisory or the integrity of its management or advisory personnel.
• NWMA is not involved in the underwriting of bonds and is not associated with any underwriting firm which
eliminates any conflicts of interest related to underwriter selection or underwriter compensation.
• During the term of the municipal advisory relationship, this Agreement will be promptly amended or
supplemented to reflect any material changes in or additions to the terms or information within this
Agreement and the revised writing will be promptly delivered to the City.
LEGAL EVENTS AND DISCIPLINARY HISTORY
NWMA does not have any legal events and disciplinary history on its Form MA and Form MA-1, which includes
information about any criminal actions, regulatory actions, investigations, terminations, judgments, liens, civil
judicial actions, customer complaints, arbitrations and civil litigation. The City may electronically access NWMA's
most recent Form MA and each most recent Form MA-1 filed with the Commission at the following website:
www.sec.soy/edgar/searchedgar/companysearch.html.
There have been no material changes to a legal or disciplinary event disclosure on any Form MA or Form MA-1 filed
with the SEC.
RECOMMENDATIONS
If NWMA makes a recommendation of a municipal securities transaction or municipal financial product or if the
review of a recommendation of another party is requested in writing by the City and is within the scope of the
engagement, NWMA will determine, based on the information obtained through reasonable diligence of NWMA
whether a municipal securities transaction or municipal financial product is suitable for the City. In addition, NWMA
will inform the City of:
• the evaluation of the material risks, potential benefits, structure, and other characteristics of the
recommendation;
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• the basis upon which NWMA reasonably believes that the recommended municipal securities transaction
or municipal financial product is, or is not, suitable for the City; and
• whether NWMA has investigated or considered other reasonably feasible alternatives to the
recommendation that might also or alternatively serve the City's objectives.
If the City elects a course of action that is independent of or contrary to the advice provided by NWMA, NWMA is
not required on that basis to disengage from the City.
RECORD RETENTION
Effective July 1, 2014, pursuant to the SEC record retention regulations, NWMA is required to maintain in writing, all
communication and created documents between NWMA and the City for 5 years.
TERM OF AGREEMENT
This agreement shall remain in effect until December 31, 2025.
TERMINATION OF ENAGEMENT AGREEMENT
Engagement can be terminated by either party with 30-days notice. In the event of termination, NWMA shall be
reimbursed for expenses incurred to the date of termination.
LIMITATION OF LIABILITY
Liability of NWMA under this agreement shall be limited to fees paid.
OTHER PROVISIONS
This Agreement represents the complete agreement between the parties. Additional services and compensation
may be added to this Agreement by a written supplement, with the mutual written consent of both parties. All
amendments or supplements shall be signed by both parties and attached to this Agreement.
NWMA agrees that it will not provide financial services to any other individual or public entity on the same
transaction for which it is providing financial services to the City under the terms of this Agreement without prior
notice to and approval by the City.
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APPROVAL OF AGREEMENT
If this agreement is satisfactory to the City, please sign and return to NWMA.
We look forward to working with the City to meet your financing needs. If you have any questions regarding this
engagement letter, please do not hesitate to call.
Sincerely,
Scott J. Bauer
Accepted and approved by City of Pasco
This day of , 2023.
By:
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