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HomeMy WebLinkAboutMilliman Inc; 2015-06-30;AGREEMENT FOR ACTUARIAL SERVICES (MILLIMAN, INC.) THIS AGREEMENT is made and entered into as of the day of ^^ne- 2015, by and between the CITY OF CARLSBAD, a municipal corporation, ("City"), and Milliman, Inc., a Washington corporation, ("Contractor"). RECITALS A. City requires the professional services of an actuarial professional that is experienced in GASB 45 reporting requirements. B. Contractor has the necessary experience in providing professional services and advice related to calculating and reporting the actuarial liability of Other Post Employment Health Benefits (OPEB) of governmental agencies. C. Contractor has submitted a proposal to City and has affirmed its willingness and ability to perform such work. NOW, THEREFORE, in consideration of these recitals and the mutual covenants contained herein. City and Contractor agree as follows: 1. SCOPE OF WORK City retains Contractor to perform, and Contractor agrees to render, those services (the "Services") that are defined in attached Exhibit "A", which is incorporated by this reference in accordance with this Agreement's terms and conditions. 2. STANDARD OF PERFORMANCE While performing the Sen/ices, Contractor will exercise the reasonable professional care and skill customarily exercised by reputable members of Contractor's profession practicing in the Metropolitan Southern California Area, and will use reasonable diligence and best judgment while exercising its professional skill and expertise. 3. TERM The term of this Agreement will be effective for a period of one (1) year from the date first above written. 4. TIME IS OF THE ESSENCE Time is of the essence for each and every provision of this Agreement. 5. COMPENSATION The total fee payable for the Services to be performed during the initial Agreement term will be sixteen thousand dollars ($16,000). No other compensation forthe Services will be allowed except for items covered by subsequent amendments to this Agreement. The City reserves the right to withhold a ten percent (10%) retention until City has accepted the work and/or Services specified in Exhibit "A", which acceptance shall not be unreasonably withheld. Incremental payments, if applicable, should be made as outiined in attached Exhibit "A". 6. STATUS OF CONTRACTOR Contractor will perform the Services in Contractor's own way as an independent contractor and in pursuit of Contractor's independent calling, and not as an employee of City. Contractor will be under control of City only as to the result to be accomplished, but will consult with City as City Attorney Approved Version 4/1/15 necessary. The persons used by Contractor to provide services under this Agreement will not be considered employees of City for any purposes. The payment made to Contractor pursuant to the Agreement will be the full and complete compensation to which Contractor is entitled. City will not make any federal or state tax withholdings on behalf of Contractor or its agents, employees or subcontractors. City will not be required to pay any wori<ers' compensation insurance or unemployment contributions on behalf of Contractor or its employees or subcontractors. Contractor agrees to indemnify City within thirty (30) days for any tax, retirement contribution, social security, overtime payment, unemployment payment or workers' compensation payment which City may be required to make on behalf of Contractor or any agent, employee, or subcontractor of Contractor for work done under this Agreement. At the City's election, City may deduct the indemnification amount from any balance owing to Contractor. 7. SUBCONTRACTING Contractor will not subcontract any portion of the Sen/ices without prior written approval of City. If Contractor subcontracts any of the Services, Contractor will be fully responsible to City for the acts and omissions of Contractor's subcontractor and of the persons either directiy or indirectly employed by the subcontractor, as Contractor is for the acts and omissions of persons directiy employed by Contractor. Nothing contained in this Agreement will create any contractual relationship between any subcontractor of Contractor and City. Contractor will be responsible for payment of subcontractors. Contractor will bind every subcontractor and every subcontractor of a subcontractor by the terms of this Agreement applicable to Contractor's work unless specifically noted to the contrary in the subcontract and approved in writing by City. 8. OTHER CONTRACTORS The City reserves the right to employ other Contractors in connection with the Services. 9. INDEMNIFICATION AND LIMITATION OF LIABILITY 9.1. Indemnification. Subject to the limitations described in Section 9.2. (Limitation of Liability) below, Contractor agrees to defend, indemnify and hold harmless the City and its officers, officials, employees and volunteers from and against all third party claims, damages, losses and expenses including reasonable attorneys' fees to the extent arising out of (i)_the negligent act or omission in the performance of the work described herein, or (ii) the willful misconduct of the Contractor, any subcontractor, anyone directly or indirectly employed by any of them or anyone for whose acts any of them may be liable. The parties expressly agree that any payment, reasonable attorney's fee, costs or expense City incurs or makes to or on behalf of an injured employee under the City's self-administered workers' compensation as a result of any act or omission of Contractor in the performance of services hereunder is included as a loss, expense or cost for the purposes of this section, and that this section will survive the expiration or eariy termination of this Agreement. 9.2. Limitation of Liabilitv. In the event of any claim arising from services provided by Contractor at any time, the total liability of Contractor, its officers, directors, agents and employees to City shall not exceed five million dollars ($5,000,000). This limit applies regardless of the theory of law under which a claim is brought, including negligence, tort, contract or othenvise. The foregoing limitations shall not apply in the event of the gross negligence, intentional fraud or willful misconduct of Contractor. City Attorney Approved Version 4/1/15 10. INSURANCE Contractor will obtain and maintain for the duration of the Agreement and any and all amendments, insurance against claims for injuries to persons or damage to property which may arise out of or in connection with performance of the services by Contractor or Contractor's agents, representatives, employees or subcontractors. The insurance will be obtained from an insurance carrier admitted and authorized to do business in the State of California. The insurance carrier is required to have a current Best's Key Rating of not less than "A-:VII"; OR with a surplus line insurer on the State of California's List of Eligible Surplus Line Insurers (LESLI) with a rating in the latest Best's Key Rating Guide of at least "A:VII". 10.1 Coveraaes and Limits. Contractor will maintain the types of coverages and minimum limits indicated below, unless Risk Manager or City Manager approves a lower amount. These minimum amounts of coverage will not constitute any limitations or cap on Contractor's indemnification obligations under this Agreement. City, its officers, agents and employees make no representation that the limits ofthe insurance specified to be carried by Contractor pursuant to this Agreement are adequate to protect Contractor. If Contractor believes that any required insurance coverage is inadequate, Contractor will obtain such additional insurance coverage, as Contractor deems adequate, at Contractor's sole expense. 10.1.1 Commercial General Liabilitv Insurance. $1,000,000 combined single-limit per occurrence for bodily injury, personal injury and property damage. If the submitted policies contain aggregate limits, general aggregate limits will apply separately to the work under this Agreement or the general aggregate will be twice the required per occurrence limit. 10.1.2 Automobile Liabilitv. (if the use of an automobile is involved for Contractor's work for City). $1,000,000 combined single-limit per accident for bodily injury and property damage. 10.1.3 Workers' Compensation and Employer's Liabilitv. Workers' Compensation limits as required by the California Labor Code. Workers' Compensation will not be required if Contractor has no employees and provides, to City's satisfaction, a declaration stating this. 10.1.4 Professional Liabilitv. Errors and omissions liability appropriate to Contractor's profession with limits of not less than $1,000,000 per claim. Coverage must be maintained for a period of three years following the date of completion of the work. 10.2 Additional Provisions. Contractor will ensure that the policies of insurance required under this Agreement contain, or are endorsed to contain, the following provisions: 10.2.1 The City will be named as an additional insured on Commercial General Liability which shall provide primary coverage to the City. 10.2.2 Contractor will obtain occurrence coverage, excluding Professional Liability, which will be written as claims-made coverage. 10.2.3 This insurance will be in force during the life of the Agreement and any extensions of it and will not be canceled without thirty (30) days prior written notice to City pursuant to the Notice provisions of this Agreement. 10.3 Providina Certificates of Insurance and Endorsements. Prior to City's execution of this Agreement, Contractor will furnish certificates of insurance and endorsements to City. City Attorney Approved Version 4/1/15 10.4 Failure to Maintain Coveraae. If Contractor fails to maintain any of these insurance coverages, then City will have the option to declare Contractor in breach and terminate the Agreement. 10.5 Submission of Insurance Policies. City reserves the right to require Contractor to make available to City for review, with prior notice, complete copies of any or all required insurance policies and endorsements. 11. BUSINESS LICENSE Contractor will obtain and maintain a City of Carisbad Business License for the term of the Agreement, as may be amended from time-to-time. 12. ACCOUNTING RECORDS Contractor will maintain complete and accurate records with respect to costs incurred under this Agreement. All records will be clearly identifiable. Upon reasonable advance written notice. Contractor will allow a representative of City during normal business hours to examine, audit, and make transcripts or copies of records and any other documents created pursuant to this Agreement. Contractor will allow inspection of all work, data, documents, proceedings, and activities related to the Agreement for a period of three (3) years from the date of final payment under this Agreement. 13. OWNERSHIP OF DOCUMENTS Subject to the provisions set forth in Section 15 (TOOL DEVELOPMENT) and Section 16 (LIMITED DISTRIBUTION) hereunder, all work product produced by Contractor or its agents, employees, and subcontractors pursuant to this Agreement is the property of City. In the event this Agreement is terminated, all work product completed by Contractor or its agents, employees and subcontractors pursuant to this Agreement will be delivered promptly to City and upon payment to Contract ownership shall vest in the City. Contractor will have the right to make one (1) copy of the work product for Contractor's records. 14. COPYRIGHTS Subject to the provisions set forth in Section 15 (TOOL DEVELOPMENT) and Section 16 (LIMITED DISTRIBUTION) hereunder. Contractor agrees that upon payment in full all copyrights that arise from the services will be vested in City and Contractor relinquishes all claims to the copyrights in favor of City. 15. TOOL DEVELOPMENT Contractor shall retain all rights, title and interest (including, without limitation, all copyrights, patents, service marks, trademarks, trade secret and other intellectual property rights) in and to all technical or internal designs, methods, ideas, concepts, know-how, techniques, generic documents and templates that have been previously developed by Contractor or developed during the course of the provision of the services ("Contractor Tools") provided such Contractor Tools do not contain any confidential information or proprietary data of City. To the extent that Contractor may include in the materials any pre-existing Contractor proprietary information or other protected Contractor materials. Contractor agrees that City shall be deemed to have a fully paid up license to make copies of the Contractor owned materials as part of this engagement for its internal business purposes and provided that such materials cannot be City Attorney Approved Version 4/1/15 modified or distributed outside the City without the written permission of Contractor or except as othenwise permitted herein. 16. LIMITED DISTRIBUTION Contractor's work is prepared solely for the use and benefit of City in accordance with its statutory and regulatory requirements. Contractor recognizes that materials it delivers to City may be public records subject to disclosure to third parties, however. Contractor does not intend to benefit and assumes no duty or liability to any third parties who receive Contractor's work and may include disclaimer language on its work product so stating. City agrees not to remove any such disclaimer language from Contractor's work. To the extent that Contractor's work is not subject to disclosure under applicable public records laws, City agrees that it shall not disclose Contractor's work product to third parties without Contractor's prior written consent; provided, however, that City may distribute Contractor's work to (i) its professional service providers who are subject to a duty of confidentiality and who agree to not use Contractor's work product for any purpose other than to provide services to City, or (ii) any applicable regulatory or governmental agency, as required. If City receives a request to disclose any Confidential Information under any Public Information Act, Open Records Act or similar law ("Request"), the City shall immediately notify Contractor and prior to disclosure give Contractor an opportunity to take any protective action it deems appropriate. If Contractor has not responded timely to the Request, as defined by the applicable law for which the Request is made pursuant to, the City may, in its sole discretion and without being in breach of this Agreement, respond to the Request as the City deems appropriate. In the event that Contractor directs the City not to disclose the Confidential Information materials sought pursuant to the Request, Contractor will indemnify City against any losses, including reasonable attorney fees and costs, sustained arising from the non-disclosure of the Confidential Information material requested in the Request. City, in its sole discretion may tender the Request to Contractor for response, including, any and all subsequent legal actions or challenges related to the non-disclosure. 17. NOTICES The name of the persons who are authorized to give written notices or to receive written notice on behalf of City and on behalf of Contractor under this Agreement. For Citv For Contractor Name Aaron Beanan Name John Botsford Titie Senior Accountant Title Principal and Consulting Actuary Department Finance Address 650 California Street, 17** Floor City of Carisbad San Francisco, CA 94108-2702 Address 1635 Faraday Avenue Phone No. 415-394-3740 Carisbad. CA 92008 Email John.botsford@.milliman.com Phone No. 760-602-2414 Each party will notify the other promptiy of any changes of address that would require any notice or delivery to be directed to another address. Oity Attorney Approved Version 4/1/15 18. CONFLICT OF INTEREST If requested by the City, Contractor shall file a Confiict of Interest Statement with the City Clerk in accordance with the requirements of the City of Carisbad Conflict of Interest Code. The Contractor shall report investments or interests in all four categories. 19. GENERAL COMPLIANCE WITH LAWS Contractor will keep fully informed of federal, state and local laws and ordinances and regulations which are applicable to those employed by Contractor, or applicable to the performance of the Services by Contractor. Contractor will at all times observe and comply with these laws, ordinances, and regulations and will be responsible for the compliance of Contractor's services with all applicable laws, ordinances and regulations. Contractor will be aware ofthe requirements ofthe Immigration Reform and Control Act of 1986 and will comply with those requirements, including, but not limited to, verifying the eligibility for employment of all agents, employees, subcontractors and consultants whose sen/ices are required by this Agreement. 20. DISCRIMINATION AND HARASSMENT PROHIBITED Contractor will comply with all applicable local, state and federal laws and regulations prohibiting discrimination and harassment. 21. DISPUTE RESOLUTION If a dispute should arise regarding the performance of the Services the following procedure will be used to resolve any questions of fact or interpretation not othenvise settled by agreement between the parties. Representatives of Contractor or City will reduce such questions, and their respective views, to writing. A copy of such documented dispute will be fonvarded to both parties involved along with recommended methods of resolution, which would be of benefit to both parties. The representative receiving the letter will reply to the letter along with a recommended method of resolution within ten (10) business days. If the resolution thus obtained is unsatisfactory to the aggrieved party, a letter outiining the disputes will be fonvarded to the City Manager. The City Manager will consider the facts and solutions recommended by each party and may then opt to direct a solution to the problem. Nothing in this procedure will prohibit the parties from seeking remedies available to them pursuant to Section 26 (JURISDICTIONS AND VENUE) hereunder. 22. TERMINATION In the event of the Contractor's failure to prosecute, deliver, or perform the Services, City shall provide written notice of any such breach to Contractor and Contractor shall have ten (10) days, or such other period of time as the parties agree, to cure such breach. In the event Contractor fails to cure a breach within the cure period. City may terminate this Agreement for nonperformance by notifying Contractor by certifled mail of the termination. If City decides to abandon or indeflnitely postpone the work or services contemplated by this Agreement, City may terminate this Agreement upon written notice to Contractor. Upon notiflcation of termination, Contractor has flve (5) business days to deliver any completed documents owned by City to City address contained in this Agreement. City will make a reasonable determination of fact based upon the work product delivered to City and of the percentage of work that Contractor has performed which is usable and of worth to City in having the Agreement completed. Based upon that flnding City will reasonably determine the final payment ofthe Agreement. Either party upon tendering thirty (30) days written notice to the other party may terminate this Agreement. In this event and upon request of City, Contractor will assemble the completed work product and put it in order for proper fliing and closing and deliver it to City. Contractor will be paid for work performed to the termination date; however, the total will not exceed the lump sum fee City Attorney Approved Version 4/1/15 payable under this Agreement. City will make the flnal reasonable determination as to the portions of tasks completed and the compensation to be made. 23. COVENANTS AGAINST CONTINGENT FEES Contractor warrants that Contractor has not employed or retained any company or person other than a bona flde employee working for Contractor, to solicit or secure this Agreement, arid that Contractor has not paid or agreed to pay any company or person, other than a bona flde employee, any fee, commission, percentage, brokerage fee, gift, or any other consideration contingent upon, or resulting from, the award or making of this Agreement. For breach or violation of this warranty. City will have the right to annul this Agreement without liability, or, in its discretion to deduct from the Agreement price or consideration, or othenvise recover, the full amount ofthe fee, commission, percentage, brokerage fees, gift, or contingent fee. 24. CLAIMS AND LAWSUITS By signing this Agreement, Contractor agrees that any Agreement claim submitted to City for monies owing must be asserted as part ofthe Agreement process as set forth in this Agreement and not in anticipation of litigation or in conjunction with litigation. Contractor acknowledges that If a false claim is submitted to City, it may be considered fraud and Contractor may be subject to cnminal prosecution. Contractor acknowledges that California Government Code sections 12650 et seq., the False Claims Act applies to this Agreement and, provides for civil penalties where a person knowingly submits a false claim to a public entity. These provisions include false claims made with deliberate ignorance of the false information or in reckless disregard of the truth or falsity of information. If City seeks to recover penalties pursuant to the False Claims Act, it is entitied to recover its litigation costs, including attorney's fees. Contractor acknowledges that the filing of a false claim may subject Contractor to an administrative debarment proceeding as the result of which Contractor may be prevented to act as a Contractor on any public work or improvement for a period of up to flve (5) years. Contractor acknowledges debarment by another jurisdiction is grounds for City to terminate this Agreement. 25. JURISDICTIONS AND VENUE Any action at law or in equity brought by either of the parties for the purpose of enforcing a right or rights provided for by this Agreement will be tried in a federal court of competent jurisdiction in the County of San Diego, State of California, and the parties waive all provisions of law providing for a change of venue in these proceedings to any other county. A party may challenge federal jurisdiction under 28 U.S.C. § 1332 only if such motion is based solely on a lack of sufficient amount in controversy. The execution of this Agreement shall impose no personal liability on the directors, officers or employees of either party and in the event of breach, non-performance or other default, the parties agree not to seek personal judgment against the officers, directors or employees ofthe other but to look to the assets ofthe City or Contractor respectively, for satisfaction of any claim hereunder. 26. FORCE MAJEURE Neither of the parties shall be liable to the other for any failure, delay or interruption in performing its obligations hereunder due to causes or conditions beyond its control including, without limitation, strikes, boycotts, picketing, slow-downs, work stoppages or labor troubles of any other type, acts of God, wars, riots or national or local emergencies. 27. SUCCESSORS AND ASSIGNS It is mutually understood and agreed that this Agreement will be binding upon City and Contractor and their respective successors. Neither this Agreement nor any part of it nor any monies due or to become due under it may be assigned by Contractor without the prior consent of City, which City Attorney Approved Version 4/1/15 shall not be unreasonably withheld. 28. ENTIRE AGREEMENT This Agreement, together with any other written document referred to or contemplated by it, along with the purchase order for this Agreement and its provisions, embody the entire Agreement and understanding between the parties relating to the subject matter of it. In case of conflict, the terms of the Agreement supersede the purchase order. Neither this Agreement nor any of its provisions may be amended, modifled, waived or discharged except in a writing signed by both parties. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] Oity Attorney Approved Version 4/1/15 26. AUTHORITY The individuals executing this Agreement and the instruments referenced in it on behalf of Contractor each represent and warrant that they have the legal power, right and actual authority to bind Contractor to the terms and conditions of this Agreement. CONTRACTOR CITY OF CARLSBAD, a municipal corporation of the State of California By: (sign here) Wt\ii<:iM S. 9<2.(]tcr<.e.f\ S.V. P. (print name/title) By: (sign here) (print name/title) By: City Monagor or Mayor'or Division Director as authorized by the City Manager Chuck McBride ATTEST: BARBARA ENGLESON City Clerk If required by City, proper notarial acknowledgment of execution by contractor must be attached. If a corporation. Agreement must be signed by one corporate officer from each of the following two groups. Group A Chairman, President, or Vice-President Group B Secretary, Assistant Secretary, CFO or Assistant Treasurer Otherwise, the corporation must attach a resolution certifled by the secretary or assistant secretary under corporate seal empowering the officer(s) signing to bind the corporation. APPROVED AS TO FORM: CELIA A. BREWER,'<arAttorney Oity Attorney Approved Version 4/1/15 EXHIBIT "A" SCOPE OF SERVICES The following is a list of the services to be provided: 1. Perform an actuarial valuation of the City's retiree OPEB plan and Water District's OPEB plan in accordance with GASB 45 as of June 30, 2015; 2. Collect data (as described below under Data Requirements) and project benefit payments; 3. Determine the Annual Required Contribution (ARC), OPEB Expense, and Net OPEB Obligation as deflned under GASB No. 45; 4. Provide a written report, completed within 7 weeks of receiving all necessary data from the City, that details the results of the valuation, required disclosures, and contains a summary ofthe assumptions, methods, and data used; and 5. Meet with staff to review the results (one meeting included in the quoted price). Data Requirements: • CalPERS GASB 45 valuation census extracted through CalPERS data extract process in an Excel flle with a copy of the data layout. • The following data as of June 30, 2013 for the Water District, in either Excel or an ASCII flle: Active Employees Retirees Receivino Health Benefits Name Name Four digit Employee ID Number Four digit Employee ID Number Gender Gender Birth Date Birth Date Hire Date Retirement Date Marital Status Spouse Birth Date (if covered under Plan) Medical Plan Medical Plan Coverage type (single, 2-party, family) Coverage Type (single, 2-party, family) Employee Group (Misc., Police, Fire, Water District or ACWA) Status Code (Retiree, Sun/ivor, etc.) Disability Retirement Indicator Medical Plan (e.g. Blue Shield, etc.) Coverage Type (Single, 2-party, etc.) Health Premiums - Paid by City Paid by Retiree - Total • Reconciliation of the City and Water District California Employer's Retiree Beneflt Trust (CERBT) account balance (beginning balance, contributions, interest and earnings, benefit payments and expenses, and ending balance), from July 1, 2013 to June 30 2014 and July 1, 2014 and June 30, 2015. City Attorney Approved Version 4/1/15 10 Dollar amount of the total retiree health premiums paid by the City and the Water District (City and Water District's portion ofthe retiree premiums) from July 1, 2013 to June 30, 2014 and July 1, 2014 to June 30, 2015. Copy of any changes made to the labor agreements with respect to the amount of retiree health benefits paid for by the City and the Water District. The amount of health premiums charged for Water District retirees by ACWA for the 2014 and 2015 premium years. City Attorney Approved Version 4/1/15 11