City Council Meeting Date: September 8, 2026
To: Mayor and Members of Council
From: Ben Martig, City Administrator
Title
Consider Resolution Approving Professional Service Contract with Merchant McIntyre.
Body
Action Requested:
The City Council is asked to approve a Resolution authorizing a professional services agreement with Merchant McIntyre Associates to assist the City in identifying and pursuing federal funding.
Summary Report:
Merchant McIntyre Associates provides federal funding assistance to local governments and other organizations, including identifying federal grant opportunities, developing funding strategies, supporting grant applications, pursuing Congressional earmarks, and assisting with federal funding requests.
Staff met with representatives from Merchant McIntyre to discuss the City's priorities and potential federal funding opportunities. The proposed engagement is consistent with the City's adopted strategic and long-range planning framework. The 2025-2028 Strategic Plan identifies financial strength and revenue diversification as a strategic priority, including a goal of increasing non-tax and non-intergovernmental revenue. The Northfield 2045 Comprehensive Plan identifies funding decisions and grant applications as important implementation tools and calls for the City to incorporate plan recommendations into capital planning and budgeting. Merchant McIntyre's work would provide additional capacity and expertise to identify and pursue external funding opportunities that can help advance these adopted priorities while leveraging local resources.
Merchant McIntyre has proposed an initial 90-day engagement during which it will conduct a Resource Inventory, develop a Federal Funding Strategy and Grants Grid, arrange meetings with Congressional and federal agency staff, and provide assistance with federal grant development and applications. The firm will also assist the City in evaluating and pursuing potential FY28 Community Project Funding/Congressionally Directed Spending requests and a WRDA authorization request for the City's water infrastructure needs. The proposed scope of work is attached (attachment 2).
Staff recognizes that the City has an interest in using professional consultants selectively, obtaining reasonable value for City resources, and considering available alternatives when engaging outside expertise. Staff therefore did not recommend proceeding with Merchant McIntyre solely on the basis of the firm's initial proposal.
Merchant McIntyre initially provided the City with a solicitation/proposal outlining its approach to federal funding assistance. Staff subsequently followed up with the firm regarding its proposed scope, services, fee structure, and approach to working with the City. Staff also conducted due diligence regarding other potential providers and considered whether a broader competitive solicitation would be likely to produce a materially different or more advantageous result for the City.
Based on that review, staff believes Merchant McIntyre's proposed $10,000 monthly fee is reasonable for the specialized federal funding services proposed. The firm is offering its standard fee structure for this scope of work, with an initial 90-day engagement rather than requiring the City to commit to a full year. The proposed work also includes specialized federal funding strategy, Congressional and federal agency outreach, grant development, earmark assistance, and WRDA authorization support that would be difficult to replicate entirely through existing City staff capacity.
Staff's review did not identify a clear benefit that would justify undertaking a longer, broader solicitation process before beginning the work. In particular, the proposed engagement is structured as a limited initial test period that allows the City to assess the firm's actual performance and value before making any longer-term commitment. Staff believes this approach provides an appropriate balance between due diligence, fiscal responsibility, and the opportunity to pursue time-sensitive federal funding opportunities.
The initial 90-day engagement should therefore be viewed as both a limited commitment and an evaluation period. During that period, staff will assess the quality and usefulness of the firm's funding strategy and grants grid, the opportunities identified, its responsiveness and coordination with City staff, its ability to develop relationships with federal agencies and Congressional offices, and its overall contribution to advancing viable funding opportunities. Any renewal for the additional one-year term would be based on the City's assessment of the value demonstrated during the initial engagement.
The firm's proposal identifies several examples of federal funding it has helped secure for other local governments. For example, Merchant McIntyre reports securing $15 million in FY26 for the removal of two hydroelectric dams in River Falls, Wisconsin, with an anticipated return on investment of 58:1 once the funds are appropriated.
The initial 90-day engagement is intended to allow the City to evaluate Merchant McIntyre's approach and the value of its services before deciding whether to continue the relationship for an additional year.
Mark McIntyre and Brandon Bookout from Merchant McIntyre will join the City Council meeting remotely to provide an overview of the firm's services and discuss how it proposes to assist the City in pursuing federal funding.
City staff have begun developing a list of potential projects and priorities for Merchant McIntyre to evaluate. The initial scope of work includes:
1. Conducting a Resource Inventory to identify federal funding objectives and potential funding requests for the City.
2. Developing a Federal Funding Strategy and Grants Grid identifying federal funding opportunities and recommended strategies for pursuing those opportunities.
3. Arranging meetings with Congressional staff and federal agency program officers related to targeted funding opportunities.
4. Supporting the City with federal grant development and applications, including planning, partnership development, grant writing, budget development, proposal submission, and administrative requirements.
5. Assisting the City with FY28 Community Project Funding/Congressionally Directed Spending requests and evaluating potential WRDA funding opportunities for the City's water infrastructure needs.
City Plans & Policies Relevance:
2025-2028 Strategic Plan - Improve Financial Strength
The Strategic Plan identifies financial strength as a top strategic priority and specifically calls for diversifying revenue sources. The plan establishes an outcome of increased revenue diversification, with a target of a 10% increase in non-tax/non-intergovernmental revenue between 2025 and 2028, and identifies creation of a revenue diversification program as a strategic initiative. Engaging specialized federal funding expertise supports this priority by increasing the City's capacity to identify and pursue federal grants, Community Project Funding/Congressionally Directed Spending, federal authorizations, and other non-local funding opportunities that can reduce the City's reliance on local revenues to fund capital investments and other adopted priorities.
Northfield 2045 Comprehensive Plan
The Comprehensive Plan establishes the City's long-term policy framework for land use, infrastructure, transportation, economic development, resilience, and other community priorities. The Plan's Implementation section specifically identifies capital planning, budgeting, funding decisions, and grant applications as tools for translating the Plan's goals into action. The proposed engagement would help the City identify and pursue external funding for projects that advance these adopted priorities, including transportation improvements, flood resilience, dam removal, park improvements, water and wastewater infrastructure, economic development, and public safety. The Plan also calls for the City to aggressively seek funding opportunities to reduce initial capital costs of infrastructure improvements while maintaining resources for ongoing maintenance and replacement.
Capital Improvement Plan/Capital Equipment Plan
Merchant McIntyre's proposed work will build upon the City's existing capital planning process by evaluating projects with staff identified in the CIP and CEP for potential federal funding opportunities and developing strategies to pursue those resources.
Other adopted plans and policies:
Federal funding opportunities identified through the engagement may also support implementation of the Park Improvement Plan (including the recently named “Cannon River Regional Park” and other adopted City plans and policies, as applicable.
Alternative Options:
The City Council may choose not to approve the agreement at this time, or may direct staff to pursue a broader competitive solicitation for federal funding consulting services.
Staff recommends approval of the agreement based on the specialized nature of the services, the City's current need for additional federal funding expertise and capacity, the due diligence conducted regarding the proposed provider and alternatives, and the limited 90-day initial commitment.
Staff recognizes that a competitive process can be appropriate when the City is seeking professional services, particularly where there may be significant differences in price or approach among potential providers. In this case, however, staff does not believe that a broader solicitation process would likely produce sufficient additional value to justify the time and delay associated with conducting one before beginning this work. The proposed initial engagement is limited to 90 days and $30,000, allowing the City to test the firm's approach and determine whether the anticipated value is being realized before considering a longer-term commitment.
The alternative of performing this work entirely with existing staff was also considered. While City staff will remain responsible for identifying priorities, providing project information, making decisions, and coordinating with the firm, staff does not currently have the same specialized federal funding expertise, federal agency relationships, Congressional engagement capacity, or dedicated time necessary to proactively pursue these opportunities at the level contemplated by the proposed engagement.
Staff therefore recommends approval of the initial 90-day agreement, with the understanding that continuation beyond the initial term should be based on demonstrated value to the City.
Financial Impacts:
The proposed professional services agreement is $10,000 per month. The initial agreement is for 90 days, for a total initial contract amount of $30,000. If the agreement is renewed for the full one-year Renewal Term, the professional services fee would be $120,000 for the renewal period.
Merchant McIntyre has also estimated approximately $2,000 in annual travel expenses for two City officials to attend meetings in Washington, D.C. These expenses are not included in the professional services fee and are not specifically addressed in the proposed agreement. Any such travel would be subject to the City's normal travel authorization and reimbursement procedures.
Tentative Timelines:
The initial contract term is October 1, 2026, through December 31, 2026. The City reserves the right to renew the agreement for one additional year, from January 1, 2027, through December 31, 2027.