HomeMy WebLinkAboutMILLIMAN, INC - 2006
II~SURANCE 1:1-01 ON FILE
WORK MAY NOT PROCEED
CLERK OF COUNCIL
DATE: 1- /f- C>'
THIS AGREEMENT, made and entered into this I' a:. day of January, 2006 by and
between Milliman, Inc., a Washington corporation (hereinafter "Consultant"), and the City of
Santa Ana, a charter city and municipal corporation organized and existing under the
Constitution and laws of the State of California (hereinafter "City").
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N-2006-004
CONSULT ANT AGREEMENT
RECITALS
A. The City desires to retain a consultant having special skill and knowledge in the field of
actuarial studies to provide an actuarial study of a proposed enhanced PARS retirement
plan for executive management employees.
B. Consultant represents that Consultant is able and willing to provide such services to the
City.
C. In undertaking the performance of this Agreement, Consultant represents that it is
knowledgeable in its field and that any services performed by Consultant under this
Agreement will be performed in compliance with such standards as may reasonably be
expected from a professional consulting firm in the field.
NOW THEREFORE, in consideration of the mutual and respective promises, and subject to the
terms and conditions hereinafter set forth, the parties agree as follows:
1. SCOPE OF SERVICES
Consultant shall perform an actuarial study regarding the adoption of a PARS Retirement
Enhancement Plan for the City's non-safety Executive Management employees, as set forth in
Exhibit A, attached hereto and incorporated by reference.
2. DELIVERY OF WORK PRODUCT
Consultant shall deliver to City all work product resulting from the services provided.
Said work product shall be submitted in a hard copy and produced in a form compatible with
City's computer system, as agreed between the Project Manager and Consultant.
Consultant shall retain all rights, title and interest in and to all technical or internal
designs, methods, ideas, concepts, know-how, techniques, generic documents and templates that
have been previously developed by Consultant or developed during the course of the provision of
the Services provided such generic documents or templates do not contain any City Confidential
Information or proprietary data. Rights and ownership by Consultant of original technical
designs, methods, ideas, concepts, know-how and techniques shall not extend to or include all or
any part of the City's proprietary data or Confidential Information. To the extent that Consultant
may include in its study, pre-existing proprietary information or other materials owned by
Consultant, Consultant agrees that City shall be deemed to have a fully paid license to make
copies of Consultant's materials, which materials may be shared with PARS to implement the
retirement plan which is the subject of this Agreement.
3. COMPENSA nON
a. City agrees to pay, and Consultant agrees to accept as total payment for its services,
the rates and charges identified in Exhibit A. The total sum to be expended under this
Agreement shall not exceed $7,250 during the term of this Agreement.
b. Payment by City shall be made within thirty (30) days following PARS advice to pay
the invoice, which will be given after PARS has reviewed and accepted the document prepared
by Consultant. Payment need not be made for work which fails to meet the standards of
performance set forth in the Recitals which may reasonably be expected by City.
4. TERM
This Agreement shall commence on the date first written above and upon delivery of the
document which is the subject of this Agreement, unless terminated earlier in accordance with
Section 12, below. The term of this Agreement may be extended upon a writing executed by the
Executive Director of Personnel Services and the City Attorney.
5. INDEPENDENT CONTRACTOR
Consultant shall, during the entire term of this Agreement, be construed to be an
independent contractor and not an employee of the City. This Agreement is not intended nor
shall it be construed to create an employer-employee relationship, a joint venture relationship, or
to allow the City to exercise discretion or control over the professional manner in which
Consultant performs the services which are the subject matter of this Agreement; however, the
services to be provided by Consultant shall be provided in a manner consistent with all
applicable standards and regulations governing such services. Consultant shall pay all salaries and
wages, employer's social security taxes, unemployment insurance and similar taxes relating to
employees and shall be responsible for all applicable withholding taxes.
6. INSURANCE
Prior to undertaking performance of work under this Agreement, Consultant shall
maintain and shall require its subcontractors, if any, to obtain and maintain insurance as
described below:
a. Worker's Compensation Insurance. In accordance with the provisions of Section 3300
of the Labor Code, Consultant, if Consultant has any employees, is required to be insured against
liability for worker's compensation or to undertake self-insurance. Prior to commencing the
performance of the work under this Agreement, Consultant agrees to obtain and maintain any
employer's liability insurance with limits not less than $1,000,000 per accident.
b. Professional liability (errors and omissions) insurance, with a combined single limit
of not less than $5,000,000 per claim.
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c. The following requirements apply to the insurance to be provided by Consultant
pursuant to this section:
(i). Consultant shall maintain all insurance required above in full force and effect
for the entire period covered by this Agreement.
(ii). Certificates of insurance shall be furnished to the City upon execution of this
Agreement and shall be approved in form by the City Attorney.
(iii). Certificates and policies shall state that the policies shall not be canceled or
reduced in coverage or changed in any other material aspect without thirty (30)
days prior written notice to the City.
d. If Consultant fails or refuses to produce or maintain the insurance required by this
section or fails or refuses to furnish the City with required proof that insurance has been procured
and is in force and paid for, the City shall have the right, at the City's election, to forthwith
terminate this Agreement. Such termination shall not effect Consultant's right to be paid for its
time and materials expended prior to notification of termination. Consultant waives the right to
receive compensation and agrees to indemnify the City for any work performed prior to approval
of insurance by the City.
7. INDEMNIFICATION
Consultant agrees to and shall indemnify and hold harmless the City, its officers, agents,
employees, consultants, special counsel, and representatives from and against any liability for
third party claims or actions of any nature to the extent such claim or action results or arises from
the negligent performance of Consultant pursuant to this Agreement. City shall promptly notify
Consultant of any such indemnified claim and Consultant shall defend City with counsel
reasonably acceptable to City, which consent shall not be unreasonably be withheld.
8. CONFIDENTIALITY
If Consultant receives from the City information which due to the nature of such
information is reasonably understood to be confidential and/or proprietary, Consultant agrees
that it shall not use or disclose such information except in the performance of this Agreement,
and further agrees to exercise the same degree of care it uses to protect its own information of
like importance, but in no event less than reasonable care. "Confidential Information" shall
include all nonpublic information. Confidential information includes not only written
information, but also information transferred orally, visually, electronically, or by other means.
Confidential information disclosed to either party by any subsidiary and/or agent of the other
party is covered by this Agreement. The foregoing obligations of non-use and nondisclosure
shall not apply to any information that (a) has been disclosed in publicly available sources; (b) is,
through no fault of the Consultant disclosed in a publicly available source; (c) is in rightful
possession of the Consultant without an obligation of confidentiality; (d) is required to be
disclosed by operation of law; or (e) is independently developed by the Consultant without
reference to information disclosed by the City.
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9. CONFLICT OF INTEREST CLAUSE
Consultant covenants that it presently has no interests and shall not have interests, direct
or indirect, which would conflict in any manner with performance of services specified under
this Agreement.
10. NOTICE
Any notice, tender, demand, delivery, or other communication pursuant to this
Agreement shall be in writing and shall be deemed to be properly given if delivered in person or
mailed by first class or certified mail, postage prepaid, or sent by telefacsimile or other
telegraphic communication in the manner provided in this Section, to the following persons:
To City:
Clerk ofthe City Council
City of Santa Ana
20 Civic Center Plaza (M-30)
P.O. Box 1988
Santa Ana, CA 92702-1988
telefacsimile (714) 647-6956
With courtesy copies to:
Personnel Services Agency, Risk Manager
City of Santa Ana
20 Civic Center Plaza (M-28)
P.O. Box 1988
Santa Ana, California 92702
telefacsimile (714) 647-5311
Attn: Jeff Stevens
and
City Attorney
City of Santa Ana
20 Civic Center Plaza (M-29)
P.O. Box 1988
Santa Ana, California 92702
telefacsimile (714) 647-6515
To Consultant:
Milliman, Inc.
Mr. Robert Dezube
1921 Gallows Road, Suite 900
Vienna, Virginia 22182
A party may change its address by giving notice in writing to the other party. Thereafter,
communication shall be addressed and transmitted to the new address. If sent by mail,
communication shall be effective or deemed to have been given three (3) days after it has been
deposited in the United States mail, duly registered or certified, with postage prepaid, and
addressed as set forth above. If sent by telefacsimile, communication shall be effective or
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deemed to have been given twenty-four (24) hours after the time set forth on the transmission
report issued by the transmitting facsimile machine, addressed as set forth above. For purposes
of calculating these time frames, weekends, federal, state, County or City holidays shall be
excluded.
11. EXCLUSIVITY AND AMENDMENT
This Agreement represents the complete and exclusive statement between the City and
Consultant, and supersedes any and all other agreements, oral or written, between the parties. In
the event of a conflict between the terms of this Agreement and any attachments hereto, the
terms of this Agreement shall prevail. This Agreement may not be modified except by written
instrument signed by the City and by an authorized representative of Consultant. The parties
agree that any terms or conditions of any purchase order or other instrument that are inconsistent
with, or in addition to, the terms and conditions hereof, shall not bind or obligate Consultant nor
the City. Each party to this Agreement acknowledges that no representations, inducements,
promises or agreements, orally or otherwise, have been made by any party, or anyone acting on
behalf of any party, which are not embodied herein.
12. ASSIGNMENT
Inasmuch as this Agreement is intended to secure the specialized services of Consultant,
Consultant may not assign, transfer, delegate, or subcontract any interest herein without the prior
written consent of the City and any such assignment, transfer, delegation or subcontract without
the City's prior written consent shall be considered null and void. Nothing in this Agreement
shall be construed to limit the City's ability to have any of the services which are the subject to
this Agreement performed by City personnel or by other consultants retained by City.
13. TERMINATION
This Agreement may be terminated by the City upon thirty (30) days written notice of
termination. In such event, Consultant shall be entitled to receive and the City shall pay Consultant
compensation for all services performed by Consultant prior to receipt of such notice of termination,
subject to the following conditions:
a. As a condition of such payment, the Executive Director may require Consultant to deliver
to the City all work product completed as of such date, and in such case such work product shall be
the property of the City unless prohibited by law, and Consultant consents to the City's use thereof
for such purposes as the City deems appropriate.
b. Payment need not be made for work which fails to meet the standard of performance
specified in the Recitals of this Agreement.
14. DISCRIMINATION
Consultant shall not discriminate because of race, color, creed, religion, sex, marital
status, sexual orientation, age, national origin, ancestry, or disability, as defined and prohibited
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by applicable law, in the recruitment, selection, training, utilization, promotion, termination or
other employment related activities. Consultant affirms that it is an equal opportunity employer
and shall comply with all applicable federal, state and local laws and regulations.
15. DISPUTES
(a). Consultant and City agree to mediate any dispute or claim arising between them out
of this Agreement, or any resulting transaction, before resorting to arbitration or court action.
Mediation fees, if any, shall be divided equally among the parties involved. If, for any dispute or
claim to which this paragraph applies, any party commences an action without first attempting to
resolve the matter through mediation, or refuses to mediate after a request has been made, then
that party shall not be entitled to recover attorney fees, even if they would otherwise be available
to the party in any such action.
(b). Arbitration of Disputes. In the event any controversy or claim arising out of this
contract or a breach thereof cannot be resolved through mediation, as set forth in section 15(a),
such dispute shall be settled by final and binding arbitration in accordance with the rules of the
American Arbitration Association. The arbitration shall take place before a panel of three
arbitrators. Within 30 days of the commencement of the arbitration, each party shall designate in
writing a single neutral and independent arbitrator. The two arbitrators designated by the parties
shall then select a third arbitrator. The arbitrators shall have a background in either insurance,
actuarial science or law. The arbitrators shall have the authority to permit limited discovery,
including depositions, prior to the arbitration hearing, and such discovery shall be conducted
consistent with the Federal Rules of Civil Procedure. The arbitrators shall have no power or
authority to award punitive or exemplary damages. Any arbitration shall be confidential, and
except as required by law, neither party may disclose the content or results of any arbitration
hereunder without the prior written consent of the other parties, except that disclosure is
permitted to a party's auditors and legal advisors.
17. JURISDICTION - VENUE
This Agreement has been executed and delivered in the State of California and the
validity, interpretation, performance, and enforcement of any of the clauses ofthis Agreement
shall be determined and governed by the laws of the State of California. Both parties further
agree that Orange County, California, shall be the venue for any action or proceeding that may
be brought or arise out of, in connection with or by reason of this Agreement.
18. PROFESSIONAL LICENSES
Consultant shall, throughout the term of this Agreement, maintain all necessary licenses,
permits, approvals, waivers, and exemptions necessary for the provision of the services
hereunder and required by the laws and regulations of the United States, the State of California,
the City of Santa Ana and all other governmental agencies. Consultant shall notify the City
immediately and in writing of its inability to obtain or maintain such permits, licenses, approvals,
waivers, and exemptions. Said inability shall be cause for termination of this Agreement.
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19. MISCELLANEOUS PROVISIONS
a. Each undersigned represents and warrants that its signature hereinbelow has the power,
authority and right to bind their respective parties to each of the terms of this Agreement, and shall
indemnify City fully, including reasonable costs and attorney's fees, for any injuries or damages to
City in the event that such authority or power is not, in fact, held by the signatory or is withdrawn.
b. All Exhibits referenced herein and attached hereto shall be incorporated as if fully set
forth in the body of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the date and year
first above written.
ATTEST:
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PATRICIA E. HEALY
Clerk of the Council
CITY OF SANTA ANA
DAVT(J.fll2,
City Manager
-
APPROVED AS TO FORM:
JOSEPH W. FLETCHER
City Attorney
By:
Laura Sheedy
Assistant City Attorney
RECOMMENDED FOR APPROVAL:
CONSULTANT
(Na~ S~-FSA
(Title) Principal and Consulting Actuary
Tax ID# 91-0675641
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EXHIBIT A
SCOPE OF SERVICES
Consultant shall provide an actuarial study, as set forth in Attachment I hereto, for a proposed
PARS Retirement Enhancement Plan for non-safety Executive Management employees of the
City of Santa Ana. Said study will be delivered to and reviewed by PARS prior to acceptance by
City.
The valuation shall comply with the requirements of California Government Code Section 7505.
The following assumptions will be utilized for the study:
Actuarial Assumptions
n. Entry Age:
o. Deferred Annuity:
January I, 2006
7%
3.25%
Utilize CalPERS table.
2.00% Compounded Annually
Utilize CalPERS table
Utilize CalPERS table
Develop appropriate criteria
Develop appropriate criteria
Develop appropriate criteria
Utilize only the 40 I (a)(l7) limits
None are assumed
All current participants are assumed to elect
single life annuity
Age at hire with City
There are no deferred benefits
a. Valuation Date:
b. Investment Return:
c. Inflation:
d. Salary Increases:
e. Cost of Living Adjustment:
f. Pre-Retirement Mortality:
g. Post-Retirement Mortality:
h. Withdrawal:
1. Retirement:
J. Disability:
k. Maximum Benefits and Salary:
1. Expenses:
m. Form of Payment:
Actuarial Methods
Funding Method:
Entry Age Normal with a 20-year
amortization ofthe unfunded actuarial
liability.
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A'YIt..llM^H Ql08hl fiRM
.
Milliman
1921 Gallows Road,Suite900
Vienna, VA 22182-3995
Tel +1703.917-0143
Fax + I 703-&27-9266
www.milliman.com
Consu".."t8 and ,ACluuios
January 4, 2006
Mr. Kevin Murphy
Senior Vice President
Public Agency Retirement Services
5141 California Avenue, Suite 150
Irvine, CA 92617-3069
Re: January 1, 2006 Actuarial Valuation for the City of Santa Ana
Retirement Enhancement Plan
Dear Kevin:
We are prepared to do the January 1, 2006 actuarial valuation for the City of Santa
Ana Retirement Enhancement Plan for a fixed fee of $7,250. The work product will be
our standard letter report. Our fee quote is based on your original November 1, 2005
email and attachment, and successive email clarifications through December 29,
2005, subject to the following modifications and interpretations.
1. Non-safety executive management employees ot the City on or after
January 1, 2006 are eligible for the supplemental retirement plan.
2. Two scenarios will be considered in regards to benefit service:
(a) Benefit service will include all service with the City and CalPERS
credited service with other CalPERS covered agencies according to the
following schedule based on years of service in a covered classification
for the City after January 1, 2006:
Years of
Service
3
4
5 or more
Percent of Other
CalPERS Service
60%
80%
100%
(b) Benefit service will include all service with the City and, upon completion
of 3 years of service in a covered classification for the City after January
1, 2006, all CaiPERS credited service with other CalPERS covered
agencies.
3. Employees who are age 55, have three years of City service in a
classification covered by the plan after January 1, 2006, and concurrently
retire from CalPERS are eligible to retire under the plan.
OFFICES IN PRINCIPAL CITlES WORLDWIOE
A TTACH1-'!ENT I .
e
Mr. Kevin Murphy
January 4, 2006
Page 3
We will need to receive a signed copy of the Consulting Services Agreement as
modified by the City of Santa Ana.
We look forward to working with you.
Sincerely,
Milliman, Inc.
R~Ub~Fr:
Consulting Actuary
cc: Dennis Yu
ASDlLUST/PHA177
M:\PAS\Santa Aoa\Santa Ana Proposal #2.doc
OFFICES IN PR1NC1PAL CITIES WORLDWIDE
ACORD".
CERTIFICATE OF LIABILITY INSURANCE
I DATE (MMllJlJfYY)
2/2106
THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY
AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS
CERTIFICATE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE
AFFORDED BY THE POliCIES BELOW.
PRODUCER
PARKER, SMITH & FEEK, INC.
22331121h Avenue N.E.
Bellevue. Washington 98004
Phone: 425-709-3600
Fax: 425-709-7460 INSURERS AFFORDING COVERAGE
INSURER Ie PACIFIC INDEMNITY INSURANCE COMPANY A++XV
INSUReo
MILLIMAN, INC.
1301 5th Avenue, Suite 3800
Seattle, WashIngton 98101-2506
INSUAER 8
INSURER c:
INSURER 0:
INSURER E:
COVERAGES
THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FORTHE POUCY PERIOD INDICATED. NOTWITHSTANDING
ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER OOCUMENTWITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY
PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS. EXCLUSIONS AND CONDJTJONS OF SUCH
POLICIES. AGGREGATE LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.
INSR TYPE OF INSURANCE pOLICY NUMBER POLl~~~FFECn~le POl]~ f~PIRAnaN LIMITS
LTR DATE MMfODNY DATE MMlDOIYY}
GENERAL LIABILITY EACH OCCURRENCE S
..::.= COMMERCiAl GENERAL lIABILllY FIRE DAMAGE (Any 0fI9 lira) S
I CLAtMS MADE D OCCUR MEO EXP (Anyone pel5oo) S
PERSONAL&ADV INJURY S
GENERAL AGGREGATE S
GEN'L AGGREGATE LIMIT APPLIES PER: PRODUCTS-COMP/OP AGG S
I' n.PRO- n
POLICY JEeT LOC
.M[OMOBILE LIABIUTY COMBINED SINGLE LIMIT S
- ANY AUTO (Eaeccldenl)
- ALL OWNED AUTOS BODILY INJURY
(Per person) S
- SCHEDULED AUTOS
f- HIRED AUTOS BODILY INJURY S
NON-OWNED AUTOS IPeraccldenll
f--
PROPERTY DMtAGE S
(PeralXident)
RRGELlABIUTY AUTO ONLY - EA ACCIDENT S
ANY AUTO OTHER THAN EAACG .
AUTOONLV: AGG S
EXCESS LIABILITY EACH OCCURRENCE $
b OCCUR D CLAIMS MADE AGGREGATE .
S
R ~EDUCTIBLe $
RETENTION S S
WORKERS COMPENSATION AND I,WGSTATU-,I 10TH-
EMPLOYERS' UABIUTY X TORY LIMITS ER
A 71719457 6/3012005 613012006 E.L EACH ACCIDENT S 1.000,000
E.L DISEASE - EACH EMPLOYee S 1.000,000
E.L DISEASE- POLICY LIMIT S 1,000,000
OTHER S
S
S
DESCRIPTION OF OPERATIONSlLOCATIONSlVEHIClESlEXCLUSIONS ADDED BY ENDORSEMENT/SPECIAL PROVISIONS
Contract No. N~20D6.DO.q.
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CERTIFICATE HOLDER I I ADD/TIONALlNSURmtIN$mERJ.entk:, ,\. i:,' CANCELLATION .10 days fDr nDflwpayment of premium
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED
BEFORE THE EXPIRATION DATE THEREOF, THE ISSUING INSURER WILL
CITY OF SANTA ANA ENDEAVOR TO MAIL~ DAYS WRfITEN NOTICE TO THE CERTIFICATE
HOLDER NAMED TO THE LEFT, BUT FAILURE TO DO SO SHALL IMPOSE NO
20 Civic Center Plaza, M-24 OBU~~;ION OR LIABILITY OF ANY KIND U~NTHE INSURER,ITS AGENTS
Santa Ana, CA 92701 <6iillE RESENTATIVES.
AUT~OR1Z"\R""R.SENTATlVE ~ ~ iJ
( T 7"~d-r1), c;; .,'/ , JI ~ n 'A
ACORD 25-S (7/97)
MILLlMAN\CERT05(MD9)
@ACORDCORPORATION1966
CERT #30B
Professional Consultants Insurance Company, Inc.
P.O. Box 1750
Burlington, VT 05402-1750
Tel: (802) 860-1958
Fax: (802) 863-2198
CERTIFICATE OF INSURANCE
Certificate Holder: City of Santa Ana
Attn: Rosa Flores
20 Civic Center Plaza, M-24
Santa Ana, CA 92701
Certificate No. 205-124
Insured:
Milliman, Inc.
per Schedule B to Policy No. PO 205
I
Period:
July I, 2005 to July I, 2006
12:01 a.m. standard time at assured's address
Form:
Claims Made
Tvoe of Coverage:
Professional Liability/Errors and Omissions
Limits:
Not less than US $5,000,000 per claim
Excess of :
US$ 1,000,000 Self Insured Retention
Subject to the terms, conditions, exclusions and limitations ofthe Policy and self-insurance
by the Assured.
Notice of Cancellation:
30 days subject to the terms ofthe policy.
This document is furnished as a matter of information only. The issuance of this document
does not make the person or organization to whom it is issued an additional Assured, nor
does it modifY in any manner the contract of insurance between the Assured and the
Underwriters. Any amendment, change or extension of such contract can only be affected
by specific endorsement attached thereto.
Issued at Burlington, Vermont
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By:
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Date:
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