BICKMORE & ASSOCIATES, INC. 2-2016

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Proposal to Provide Actuarial Valuation of OPEB Liabilities For the City of Santa Ana May 2016 The following is a description of the general process we typically follow. Some changes can often be made to suit the City's needs or preferences. Our approach to providing services to the City will be for the consultant to collect and review preliminary information with appropriate City representatives to obtain their specific directions and needs regarding the upcoming valuation. At this time, a tentative schedule will be developed, such as the typical schedule shown below. Typical Time Elapsed. for Bickmore Time Description of Tasks - - 1 week 1 week Engagement letter or contract signed. Bickmore and City representatives discuss project overvlew/Issues. 1 week 2 weeks Data request materials are sent to the City from actuarial analyst. Data request materials are returned to Bickmore analyst. Returned data Is organized by analyst and (If needed) subsequent questions asked. Varies -Agency's timing 2 weeks 4 weeks Actuary prepares report to City summarizing recommended assumptions; review with City Organized data is coded by analyst and checked by senior actuaries; add'I questions/analysis If needed. 2 weeks 6 weeks 1 week 7 weeks Once results are set, report exhibits are created and full report Is drafted. Editing process begins. 1 week 8 weeks Actuaries complete final review and editing of the full draft report and send to the City. When the City is ready, the lead actuary reviews draft report with city staff, Once the City approves the report draft, Bickmore Issues the final report and assists with any audit Issues. Varies - Agency's timing Varies- Agency's timing A complete and accurate data submission and responsiveness to our questions (although tedious, we know) can greatly improve our ability to turn our report out more quickly, should that be important to the City for its particular circumstances. S. City Staff Estimate We recognize that significant employee and plan information most be communicated between the City and the actuary and respect the effort that is required from our clients to provide the data necessary for Bickmore to produce a credible product. Likewise, we commit significant time beyond the report itself to identify issues worthy of discussion, the ramifications of various results and decisions and to assist in the disclosure of results for financial reporting. The time required for each agency to gather the data varies based on the complexity of benefits and the agency's existing records and ability to select the fields required to prepare the calculations. We've included samples of our typical Data Request Parts I and II as Appendices A and B, respectively. In some cases, we have had clients able to complete these requests in about 4 hours (especially when a CaIPERS OPEB data extract is used). Others may require 8-12 hours if retrieval of information is less automated. In addition, we anticipate 1-4 hours of finance staff time to answer occasional questions or to discuss the draft report prior to it being finalized. As we noted earlier in our proposal, the time that Bickmore and the City invested during the 2014 valuation process provides a solid foundation regarding the benefits, funding policy and plan population that should shorten the time required during this 2016 valuation process.in addition, elimination of the various union subsidy plans from this engagement will reduce the breadth of information to be provided and analyzed. Bickmore a ;