HomeMy WebLinkAboutGabriel, Roeder, Smith & Company Agreement For Actuarial Consulting Services 2009 12 09 CITY OF WINTER SPRINGS, FLORIDA
AGREEMENT FOR ACTUARIAL CONSULTING SERVICES
THIS AGREEMENT, made and entered into this 11 'q day of
Ge-- r►l6(La- , 2009, by and between the City of Winter Springs, a Florida
municipal corporation, hereinafter referred to as "City," and Gabriel, Roeder, Smith &
Company, a Foreign Profit Corporation, , hereinafter referred to as "Actuary."
WITNESSETH:
WHEREAS, the City is desirous of retaining professional actuarial consulting
services with regard to its pension plans; and
WHEREAS, the Actuary is a duly qualified expert in the field of actuarial
analysis of pension systems; and
WHEREAS, the City now desires to enter into an agreement with the Actuary to
perform such services as provided herein; and
WHEREAS, the City has the authority to enter into agreements with actuarial
firms under such terms and conditions as it may determine.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and promises herein contained, the parties hereto agree as follows:
1. Effective Date and Termination. This Agreement shall be in effect from
the date first above written and shall continue in effect for a term of three (3) years. This
Agreement may be extended at the sole discretion of the City for additional periods on
terms and conditions mutually agreeable to the parties. This Agreement may be
terminated by any party with or without cause with 30 days advance written notice. In
the event of termination, Actuary will be compensated for services actually rendered up
to and including the date of termination. Payments will be made by the City under the
provisions of the Local Government Prompt Payment Act.
2. Services and Fees. Actuary shall perform the actuarial and consulting
services requested by the City as outlined in Appendix A, attached hereto and
incorporated herein by this reference, and may provide other or modified services as
mutually agreed upon in writing by the City and the Actuary. From time -to -time, the
City may require services other than those described in Appendix A such as
communication services, applied technology services, defined contribution plan
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DEC 14 2009
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services, or other supplemental consulting services. Fees for such services shall be
based on the hourly rates mutually agreed upon by the parties at the time and such
services shall be subject to the terms described in a Letter of Engagement.
Furthermore, Actuary is not constrained from supplementing services outlined in
Appendix A with additional items or elements deemed necessary to permit the
development of alternative approaches or the application of proprietary analytical
techniques, within the price schedule set forth in the Appendix A, unless agreed
otherwise by the parties in writing.
The client in this matter shall be the City of Winter Springs as represented
by the Pension Board of Trustees of the City of Winter Springs. This Agreement does
not create any relationship between Actuary and any other related private, not for
profit, or governmental entity, including, but not limited to, the City of Winter Springs'
Plan Sponsor itself or participants in pension plan. Such entities may rely upon Actuary
work products only with the permission of both Actuary and City. The Actuary shall
have no obligation to work for such entities, however, Actuary may freely elect to work
for such an entity with consent of the City and provided that copies of all related work
products are provided to the City.
Further, the Actuary agrees to perform said services at the rates outlined
in Appendix A. Said rates shall not be increased during the first two years under this
Agreement. The services for the third year of this Agreement shall be determined by
mutual agreement of the parties, but in no event shall the third year rate exceed any
increase in the Consumer Price Index - All Urban Consumers - U.S. City Average.
Invoices for work in progress, and out -of- pocket expenses, shall be submitted to the
City on a quarterly basis.
3. Out -of- Pocket Expenses. Out -of- pocket expenses for telephone, copying,
computer costs and other administrative expenses associated with the services are
included in the fees. Out -of- pocket travel expenses associated with services performed
shall be paid in addition to the rates specified herein, and shall not exceed the greater of
$500 per project or 10% of any project fee, unless mutually agreed upon otherwise in
writing by the City and the Actuary.
4. Party Representatives. The City Manager or his duly designated
representatives shall be considered the City representative for this Agreement. Any and
all services performed pursuant to this contract shall be done so only at the specific
request of the City representative. Larry Wilson or his duly designated representative
shall be considered the Actuary representative. All projects desired by the City must be
submitted in writing to the Actuary's designated representative.
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5. Assignment. Actuary agrees to make no assignment of any of its rights,
duties or obligations under this Agreement without the express, written approval of the
City.
6. Indemnification. The Actuary agrees to indemnify and save harmless the
City, its officials, employees, attorneys, and agents from and against all losses, liabilities,
penalties, fines, damages and claims (including taxes), and all related costs and
expenses (including reasonable attorneys' fees and disbursements and costs of
investigation, litigation, settlement, judgments, interest and penalties) incurred in
connection with any action or proceeding threatened or brought against the City, its
officials, employees, attorneys, and agents as a result of: (A) negligence or malfeasance
on the part of Actuary in the performance of its duties under this Agreement; (B) any
action or proceeding based on a claim that any piece of equipment, software,
commodity, or service supplied by Actuary or its subcontractors, or the operation of
such equipment, software, commodity, or service, or the use or reproduction of any
documentation provided with such equipment, software, commodity, or service
infringes any United States or foreign patent, copyright, trade secret or other
proprietary right of any person or entity, which right is enforceable under the laws of
the United States. In addition, should the equipment, software, commodity, or service,
or the operation thereof, become, or in Actuary's opinion be likely to become, the
subject of a claim of infringement, Actuary shall at its sole expense, (i) procure for the
City the right to continue using the equipment, software, commodity, or service, or if
such option is not reasonably available to City, (ii) replace or modify the same with
equipment, software, commodity, or service of equivalent function and performance so
that it becomes non - infringing, or if such option is not reasonably available to Actuary
(iii) accept its return by City with appropriate credits to City against Actuary's charges
and reimburse City for any losses or costs incurred as a consequence of City ceasing to
use and returning the equipment, software, commodity, or service; and (C) claims made
by Actuary's employees while working on City premises on the City's projects,
provided that City has complied with all relevant Federal and State Laws related to
workplace safety, and human rights, including, but not limited to anti- discrimination
and anti- harassment laws.
In any and all claims against City, or any of its officers, agents, attorneys, or
employees, by any employee of the contractor or any of its subcontractors, the
indemnification obligation under the Agreement shall not be limited in any way by the
amount or type of damages, compensation, or benefits payable by or for Actuary or any
of its subcontractors under worker's disability compensation acts, disability benefit acts,
or other employee benefit acts. This indemnification clause is intended to be
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comprehensive. Any overlap in subclauses, or the fact that greater specificity is
provided as to some categories of risk, is not intended to limit the scope of
indemnification under any other sub clauses.
The duty to indemnify will continue in full force and effect not withstanding the
expiration or early termination of the contract with respect to any claims based on facts
or conditions, which occurred prior to termination.
7. Liability Insurance. Actuary shall purchase and maintain such insurance
as will protect it from claims which may arise out of or result from its performance
under the Agreement, whether such performance be by Actuary or by any
subcontractor or by anyone directly or indirectly employed by any of them, or by
anyone for whose acts any of them may be liable. The insurance shall be written for not
less than the greater of $1,000,000 and any limits required by law, and shall include
contractual liability insurance as applicable to Actuary's obligations under the
indemnification clause of this contract.
8. Uncertain Nature of Opinions. It is understood by the Actuary and City
that any actuarial opinions provided and liability appraisals made are estimates that are
not perfect by nature and may not be representative of future reality. It is understood
by the Actuary and the City that any policy decision made by the City that could have
significant financial impact may require a second opinion.
9. Limit of Liabilities. The City's liability under this Agreement is
expressly limited to the amount of fees and costs invoiced by Actuary for services
actually rendered. Furthermore, notwithstanding any other provision set forth in this
Agreement, nothing contained in this Agreement shall be construed as a waiver of the ,
City's right to sovereign immunity under section 768.28, Florida Statutes, or other
limitations imposed on the City's potential liability under state or federal law. As such,
the City shall not be liable under this Agreement for punitive damages or interest for
the period before judgment. Further, the City shall not be liable for any claim or
judgment, or portion thereof, to any one person for more than one hundred thousand
dollars ($100,000.00), or any claim or judgment, or portion thereof, which, when totaled
with all other claims or judgments paid by the State or its agencies and subdivisions
arising out of the same incident or occurrence, exceeds the sum of two hundred
thousand dollars ($200,000.00). This paragraph shall survive termination of this
Agreement. It is agreed that any damages resulting from mistakes or errors on the part
of the Actuary shall be limited to the total of fees paid under the contract.
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10. Jurisdiction; Venue. This Agreement shall be construed in accordance
with the laws of the State of Florida and any remedies of the parties pertaining hereto
shall likewise be governed by the Laws of the State of Florida. The parties further agree
that venue for any dispute under this Agreement shall be in Seminole County, Florida
for state court actions and Orlando, Florida for federal court actions. In the event of
disputes, both parties to this Agreement agree to waive their right to a jury trial and to
first attempt to promptly settle the matter through mediation before any suit or
proceeding is initiated under this Agreement.
11. Conflict of Interest. The Actuary is aware of the conflict of interest laws of
the State of Florida, Chapter 112, Florida Statutes, as amended, and agrees that it will
fully comply in all respects with the terms of said laws. It is the intention of both the
City and the Actuary that the Actuary maintains the highest standards of ethical
propriety in connection with its duties under this Agreement. Any potential conflicts of
interest and the full scope of such conflicts shall be disclosed to the City by the Actuary,
so that the City may determine if the potential conflict of interest is one that it wishes to
waive or the potential conflict may be resolved.
12. Entire Agreement. This Agreement, specified attachments, and the RFP
Proposal submitted to the City by the Actuary constitute the entire Agreement and
understanding between the City and the Actuary with respect to actuarial and
consulting services. In the event of any conflict among these documents, the following
order of precedence shall apply (in descending order of precedence): This Agreement
as amended, any Appendix attached to this Agreement as amended, and the Actuary's
RFP Proposal submitted to the City. This Agreement supersedes any and all
agreements, either oral or written, between the parties hereto with respect to actuarial
and consulting services and contains all the covenants and agreements between the
parties with respect to the rendering of such services. This Agreement may be modified
or amended only by a written document signed by the parties hereto.
13. Waiver and Severability. The failure of a party to insist upon strict
adherence to any term of the Agreement shall not be considered a waiver, or deprive
the party of the right thereafter to insist upon strict adherence to that term, or any other
term of the Agreement. Any breach or default by a party shall not be waived or
released other than in writing signed by the other party.
Each provision of the Agreement shall be deemed to be severable from all other
provisions of the contract and, if one or more of the provisions of the contract shall be
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declared invalid, the remaining provisions of the contract shall remain in full force and
effect.
14. Board Minutes. The City shall routinely provide Actuary with copies of
Board Minutes relevant to this Agreement for Actuary's reference in connection with
work to be performed pursuant to this contract. Actuary is not obligated to provide
corrections to the minutes. Silence on the part of Actuary does not constitute agreement
with the minutes, even with respect to meetings that the Actuary actually attended or at
which actuary was directly or indirectly quoted.
15. Confidentiality. Actuary shall instruct its employees and the employees
of any subcontractor to keep as confidential information concerning the business of the
City, its financial affairs, its relations with its participating municipalities and courts,
members, retirees and beneficiaries, and its employees, as well as any other information
which may be specifically classified as confidential by the City. At City's request,
Actuary or any subcontractor(s) and each of their employees may be required to sign
confidentiality statements, to the extent allowed by law, prior to beginning or
continuing to work on the Agreement. Actuary will not normally print full Social
Security numbers on documents used for communication with City or its participants.
The only exception Actuary will make to this policy without direction from City, relates
to certain necessary and confidential communications between City and Actuary that
are directly related to work assignments. All copies of information developed by
Actuary in connection with the Agreement are the property of and will be returned to
the City, upon termination of this Agreement or upon request. Actuary reserves the
right to shred or otherwise dispose of information at such time records may be
discarded in accordance with the Florida Public Records Act, unless it receives
instructions to the contrary from City. Actuary will not reveal or disclose either
information or findings concerning this Actuary with anyone who does not have a
substantial need -to -know and who has not been expressly authorized in writing by City
to receive the information /findings. The Actuary must ensure that all safeguards and
proper procedures are implemented to protect confidential information.
16. Tax, Investment, and Legal Advice. Based upon its general background and
research on Federal Income Tax, Legal Issues, and Investment Matters, Actuary
employees may from time to time provide general comments and information on same.
However, no Actuary work product shall be deemed to provide income tax advice,
legal advice, or investment advice unless such work product contains one of the
following phrases or substantially equivalent language.
• "This work product is intended to provide income tax advice."
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• "This work product is intended to provide legal advice."
• "This work product is intended to provide investment advice."
No oral communication of any Actuary employee shall be interpreted to provide
income tax advice, legal advice, or investment advice. Further, no Actuary work
product shall be used for the purpose of avoiding tax - related penalties under the
Internal Revenue Code or (ii) marketing or recommending to another party any tax -
related matter addressed within the work product.
17. Third Party Dealings. Actuary will not provide information related to the
City to third parties except with the permission of, and under the specific direction of,
City. By giving such direction and permission, City agrees to indemnify Actuary, or to
require such third party to indemnify Actuary, against the misuse or misunderstanding
of Actuary's work products by such third party. Actuary shall not review any third
party work product except under the specific written direction of City to do so, and
only for reasonable compensation. Such review if undertaken shall be limited to those
areas in which Actuary has expertise, and shall specifically exclude conclusions related
to income tax, investment matters, and legal matters.
18. Limitations. Actuary shall act with due diligence in all matters in which it
provides services under this Agreement, but shall not serve as a fiduciary of the City.
Actuary shall not be responsible under any circumstance for making employee or
employer contributions to City. No provision of this Agreement shall be interpreted to
require Actuary to provide income tax advice, investment advice, or legal advice to
City. Actuary has no responsibility for the performance or non performance of City's
assets, the structure of the City's portfolio, or the selection or termination of investment
managers and consultants.
19. Warranty. Actuary represents and warrants that all work performed under
this Agreement will be performed by individuals who are qualified to do so in
accordance with requirements as are from time -to -time issued by various actuarial and
other professional bodies. Actuary warrants that the work product will be subject to an
internal peer review procedure. Finally Actuary represents and warrants that Actuary
has no direct or indirect financial relationship to the City, other than the relationship
described in this Agreement.
20. Public Records. It is hereby specifically agreed that any record,
document, computerized information and program, audio or video tape, photograph,
or other writing of the Actuary and its independent contractors and agents related,
directly or indirectly, to this Agreement, shall be deemed to be a Public Record whether
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in the possession or control of the City or the Actuary. Said record, document,
computerized information and program, audio or video tape, photograph, or other
writing of the Engineer is subject to the provisions of Chapter 119, Florida Statutes, and
may not be destroyed without the specific written approval of the City's City Manager.
upon request by the City, the Actuary shall promptly supply copies of said public
records to the City. All books, cards, registers, receipts, documents, and other papers in
connection with this Agreement shall at any and all reasonable times during the normal
working hours of the Actuary be open and freely exhibited to the City for the purpose
of examination and /or audit.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on the date first above written.
ATTEST CITY OF WINTER SPRINGS, FLORIDA
n drea Lorenzo - Luaces, City Clerk Ke in Smith, ity Manager
Date: io'N
Approved by the City Commission on November 9, 2009.
ATTEST GABRIEL, ROEDER, SMITH & COMPANY
IuL_i
By: Lawrerlee_ F. u.)i'Isor', By: INIMMIEIMArit s
Senior Nostdarrf cod_ AOEhWYy„
a Date: /2-.), `el
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A
VENDOR RATE /FEE SCHEDULE ATTACHMENT
The following is a detailed fee schedule based upon the scope of services requested:
Service Annual Fee
Benefits Administration Functions:
• Determine eligibility, benefits and vesting of Plan (If annually included in
participants valuation fee)
• Perform contribution analysis and review for Plan (If annually included in
participants valuation fee)
• Prepare benefit calculations for Plan participants 5300 per calculation
• Prepare pension service time buy -back calculations S400 per calculation
• Process all documents for payments to terminated or retiring 5150 per employee
employees
• Prepare and deliver annual employee benefit statements for (Included in valuation
Nan participants fee)
Actuarial Valuation and SPD Preparation:
• Produce annual actuarial valuation report in accordance with $8,862 (includes GASB
State laws and regulations to establish required municipal accounting information)
contribution levels, set forth Fund assets and liabilities,
provide historical data and render observations and opinions
as to the funding of the Plan
• Meet with the Board of Trustees of the Fund, the Pension (Annual meeting with
Board or Commission to explain changes to the Fund and Board included in
actuarial assumptions utilized valuation fee)
• Prepare a Summary Plan Description (SPD) every two (2)
years $1,950 biannually
• Review Plan mortality tables used to calculate actuarially- 5595 for analysis (expect
equivalent benefit options infrequent update)
Ad hoc Calculations and Analysis:
• Calculate and report the cost of changes in benefit structure Based upon hourly rates
as a result of change of direction in City policy or changes in — fee is function of scope
Federal or State laws impacting upon the Plan of changes contemplated
• Provide general advice and counsel on the Plan and benefit Unlimited telephone
structures conferences
• Respond to any inquiries by the State of Florida regarding Based upon hourly rates -
issues derived from their review of the Actuarial Valuation generally included in
Report and obtaining State acceptance valuation fee
Review current plan design to ensure the retirement program Based upon hourly rates —
• is meeting the goals of the City in benefits provided and cost fee is function of scope of
changes
control Based upon hourly rates -
• Consult with City's financial advisors and/or legal counsel in generally included in
the implementation and administration of the plan valuation fee
Service Annual Fee
Additional Services:
Additional work above and beyond stated scope of services may, Based upon hourly rates
from time to time, be requested by the City. All such additional
work must be authorized by the City in writing. For all additional
work, vendor is requested to provide a proposal which shall include
a breakdown of the hourly rate which will be applicable, in
determining the cost of these services, by major category of
employee (actuary, associate, clerical, etc.); for these additional
services, billing will be broken down into time per category by
major task. These fees will be fixed for the initial period of two
years, and negotiated thereafter. Prior to accepting an assignment
for additional work, you will be requested to provide a proposed fee
for the task on a "not to exceed" basis prior to receiving authority to
proceed.
Fees and hourly rates will not increase for two (2) years and will be subject to increase
annually thereafter solely based upon the change in the consumer price index (CPI)
Our fee for other projects, such as actuarial impact statements, will be based on our hourly rates.
We normally provide a not -to- exceed fee quote for major special services. Under the not -to-
exceed approach, we would charge the lesser of our costs, based upon our hourly rates and the
quoted not -to- exceed fee. We will provide you with a not -to- exceed fee commitment prior to the
start of any such project.
Based upon the disclosed invoices of the current actuary, our hourly rates may be higher but our
efficiency is superior as measured by the fact that our fees for similar projects for our clients are
lower.
Our hourly rates are quite competitive in the industry and are determined based upon the
experience and abilities of our staff.
Unlike some other fans, our hourly rates include our overhead. We do not load our fees for
computer, technical and administrative services.
VENDOR RATE/FEE SCHEDULE
Please include a breakdown of the dollar amount of and the basis for your fees as appropriate based on the
following categories (generally defined in Scope of Services):
Benefits Administration Functions $ (see attached)
Annual Valuation and SPD Preparation $ (see attached)
Ad hoc Calculations and General Analysis $ (see attached)
Total proposed annual fee for base services as per scope of work $ (see attached)
FeelRate Schedule for any additional services (above and beyond that stated in the base scope of
services) that may be requested:
Category of Employee Hourly Rate
Senior Consultant and Actuary $325 —$395
Consultant and Actuary $250 — $295
Senior Analyst S175 —$225
Analyst S125 —$170
Administrative Assistant $ 75 —S115
For all additional work, vendor is requested to provide a proposal which shall
include a breakdown of the hourly rate which will be applicable, in determining the
cost of these services, by major category of employee (actuary, associate, clerical,
etc.); for these additional services, billing will be broken down into time per
category by major task. These fees will be fixed for the initial period of two years,
and negotiated thereafter. Prior to accepting an assignment for additional work,
you will be requested to provide a proposed fee for the task on a "not to exceed"
basis prior to receiving authority to proceed.
This Form Must Be Completed and Returned With Your Submittal.
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