08/03/2015 – Nelson Mullins Ext

Law Firm Renewal Agreement (Part I and II)
08/03/2015 – Work/Business
eboard link icon Agenda Item – Law Firm Renewal Agreement

Note: Letter of Engagement says “On the tenth day of each month, DCSD will forward to our firm, an advance retainer fee in the amount of $65,000.00 per month, from general funds, from which our firm will bill against for the specified services at the hourly rates contained in this Engagement Letter. In the event the monthly retainer is not expended (excluding costs), the DCSD will be issued a credit on the next monthly billing. If the monthly retainer is expended (excluding costs), the DCSD will remit funds to compensate the firm for the amount due in excess of the retainer. Monthly billings shall be reconciled by the 5th business day of the ensuing month and submitted to DCSD for payment. Said payment shall be processed by the 15th of every month.”

Transcript
[08:34 into discussion]
Stan Jester (Board of Education) – The renewal agreement in question was emailed to us last week.  For posterity, can we get this on eBoards so we can see this in the future.
When is this contract scheduled to be bid out again?
Michael Walker (iChief Legal Officer) – Next Year
Stan Jester – Philosophically I’m against extending contracts that aren’t bid out.  I have a question for Dr. Bell.
The letter of engagement says that on the 10th day, DCSD will effectively cut Nelson Mullins a check for $65,000 and one for $25,000 and I’ve seen those on the vendor spend report.
Dr. Michael Bell (Chief Financial Officer) – yes
Stan Jester – And that happens every month?
Dr. Bell – No.  The law firm submits and invoice to the office of legal affairs.  We review the invoice and then get a signature by the chief legal officer and superintendent.  In some months in the past, it didn’t happen on schedule.
Also, there is a retainer they bill against.  So, you can’t just say it’s going to be that amount every month.  Sometimes there is a lag and we don’t accrue against the retainer because it’s billed against the retainer.  It’s not an exactly known number.
Stan Jester – Did you we were invoiced on the retainer and that’s when we send the money?
Dr. Bell – No, we get an invoice from the law firm and they bill against the retainer.  So that number varies somewhat.  The office of legal affairs initiates the payment process.  It goes through the payment process and then goes through finance.  If everything is in order, we then pay it out of accounts payable.
Stan Jester – So before the 9th, you true up how much you owe them and then you pay them what’s left.
Dr. Bell – It depends on how they structure the invoices.  If a law firm didn’t get paid in a prior month because they didn’t submit, they’ll total that up as the amount payable.
Stan Jester – So, there’s a lot of truing going on and on some months we don’t send them the retainer.  So, in some months we may not have legal fees at all.
Dr. Bell – If it turns out the law firm didn’t do anything and the retainer is 0, but I don’t think I’ve seen that yet.
Stan Jester – There have been two or three months this year where we had zero legal fees.  So, that would be the case.
Dr. Bell – I would have to go back and take a look at those specific months in terms of timing.