HomeMy WebLinkAbout15-001 - Healthcare Acutaries - 2015-2017 Retiree Benefits ReviewCity of Tukwila
6200 Southcenter Boulevard, Tukwila WA 98188
Contract Number: 15 -001
Council Approval N/A
CONTRACT FOR SERVICES
This Agreement is entered into by and between the City of Tukwila, Washington, a non - charter
optional municipal code city hereinafter referred to as "the City," and Healthcare Actuaries ,
hereinafter referred to as "the Contractor," whose principal office is located at _16519 107`° Place NE,
Bothell, WA 98011
WHEREAS, the City has determined the need to have certain services performed for its citizens
but does not have the manpower or expertise to perform such services; and
WHEREAS, the City desires to have the Contractor perform such services pursuant to certain
terms and conditions; now, therefore,
IN CONSIDERATION OF the mutual benefits and conditions hereinafter contained, the parties
hereto agree as follows:
1. Scope and Schedule of Services to be Performed by Contractor. The Contractor shall perform
those services described on Exhibit A attached hereto and incorporated herein by this reference as if
fully set forth. In performing such services, the Contractor shall at all times comply with all Federal,
State, and local statutes, rules and ordinances applicable to the performance of such services and the
handling of any funds used in connection therewith. The Contractor shall request and obtain prior
written approval from the City if the scope or schedule is to be modified in any way.
2. Compensation and Method of Payment. The City shall pay the Contractor for services rendered
according to the rate and method set forth on Exhibit A attached hereto and incorporated herein by
this reference. The total amount to be paid shall not exceed _$15,750_.
3. Contractor Budget. The Contractor shall apply the funds received under this Agreement within the
maximum limits set forth in this Agreement. The Contractor shall request prior approval from the
City whenever the Contractor desires to amend its budget in any way.
4. Duration of Agreement. This Agreement shall be in full force and effect for a period commencing
January 1 , 2015, and ending March 30 , 2017_, unless sooner terminated under
the provisions hereinafter specified.
5. Independent Contractor. Contractor and City agree that Contractor is an independent contractor
with respect to the services provided pursuant to this Agreement. Nothing in this Agreement shall be
considered to create the relationship of employer and employee between the parties hereto. Neither
Contractor nor any employee of Contractor shall be entitled to any benefits accorded City employees
by virtue of the services provided under this Agreement. The City shall not be responsible for
withholding or otherwise deducting federal income tax or social security or contributing to the State
Industrial Insurance Program, or otherwise assuming the duties of an employer with respect to the
Contractor, or any employee of the Contractor.
CA Revised 2012 Page 1 of 4
6. Indemnification. The Contractor shall defend, indemnify and hold the City, its officers, agents,
officials, employees and volunteers harmless from any and all claims, injuries, damages, losses or suits
including attorney fees, arising out of or in connection with the performance of this Agreement, except for
injuries and damages caused by the sole negligence of the City. Should a court of competent jurisdiction
determine that this Agreement is subject to RCW 4.24.115, then, in the event of liability for damages
arising out of bodily injury to persons or damages to property caused by or resulting from the concurrent
negligence of the Contractor and the City, its officers, officials, employees, and volunteers, the
Contractor's liability hereunder shall be only to the extent of the Contractor's negligence. It is further
specifically and expressly understood that the indemnification provided herein constitutes the
Contractor's waiver of immunity under Industrial Insurance, Title 51 RCW, solely for the purposes of this
indemnification. This waiver has been mutually negotiated by the parties. The provisions of this section
shall survive the expiration or termination of this Agreement.
7. Insurance. The Contractor shall procure and maintain for the duration of the Agreement, insurance
against claims for injuries to persons or damage to property which may arise from or in connection
with the performance of the work hereunder by the Contractor, their agents, representatives,
employees or subcontractors. Contractor's maintenance of insurance, its scope of coverage and limits
as required herein shall not be construed to limit the liability of the Contractor to the coverage
provided by such insurance, or otherwise limit the City's recourse to any remedy available at law or in
equity.
A. Minimum Scope of Insurance. Contractor shall obtain insurance of the types and with the limits
described below:
1. Automobile Liability insurance with a minimum combined single limit for bodily injury and
property damage of $1,000,000 per accident. Automobile liability insurance shall cover all
owned, non - owned, hired and leased vehicles. Coverage shall be written on Insurance Services
Office (ISO) form CA 00 01 or a substitute form providing equivalent liability coverage. If
necessary, the policy shall be endorsed to provide contractual liability coverage.
2. Commercial General Liability insurance with limits no less than $1,000,000 each occurrence,
$2,000,000 general aggregate and $2,000,000 products - completed operations aggregate limit.
Commercial General Liability insurance shall be written on ISO occurrence form CG 00 01
and shall cover liability arising from premises, operations, independent contractors, products -
completed operations, stop gap liability, personal injury and advertising injury, and liability
assumed under an insured contract. The Commercial General Liability insurance shall be
endorsed to provide the Aggregate Per Project Endorsement ISO form CG 25 03 11 85 or an
equivalent endorsement. There shall be no endorsement or modification of the Commercial
General Liability Insurance for liability arising from explosion, collapse or underground
property damage. The City shall be named as an insured under the Contractor's Commercial
General Liability insurance policy with respect to the work performed for the City using ISO
Additional Insured endorsement CG 20 10 10 01 and Additional Insured- Completed
Operations endorsement CG 20 37 10 01 or substitute endorsements providing equivalent
coverage.
3. Workers' Compensation coverage as required by the Industrial Insurance laws of the State of
Washington.
CA Revised 1 -2013 Page 2 of 4
B. Other Insurance Provision. The Contractor's Automobile Liability and Commercial General
Liability insurance policies are to contain, or be endorsed to contain that they shall be primary
insurance with respect to the City. Any insurance, self - insurance, or insurance pool coverage
maintained by the City shall be excess of the Contractor's insurance and shall not contribute with
it.
C. Acceptability of Insurers. Insurance is to be placed with insurers with a current A.M. Best rating
of not less than A: VII.
D. Verification of Coverage. Contractor shall furnish the City with original certificates and a copy
of the amendatory endorsements, including but not necessarily limited to the additional insured
endorsement, evidencing the insurance requirements of the Contractor before commencement of
the work.
E. Subcontractors. The Contractor shall have sole responsibility for determining the insurance
coverage and limits required, if any, to be obtained by subcontractors, which deteHnination shall
be made in accordance with reasonable and prudent business practices.
F. Notice of Cancellation. The Contractor shall provide the City and all Additional Insureds for this
work with written notice of any policy cancellation, within two business days of their receipt of
such notice.
G. Failure to Maintain Insurance. Failure on the part of the Contractor to maintain the insurance as
required shall constitute a material breach of contract, upon which the City may, after giving five
business days notice to the Contractor to correct the breach, immediately terminate the contract or,
at its discretion, procure or renew such insurance and pay any and all premiums in connection
therewith, with any sums so expended to be repaid to the City on demand, or at the sole discretion
of the City, offset against funds due the Contractor from the City.
8. Record Keeping and Reporting.
A. The Contractor shall maintain accounts and records, including personnel, property, financial and
programmatic records which sufficiently and properly reflect all direct and indirect costs of any
nature expended and services performed in the performance of this Agreement and other such
records as may be deemed necessary by the City to ensure the performance of this Agreement.
B. These records shall be maintained for a period of seven (7) years after termination hereof unless
permission to destroy them is granted by the office of the archivist in accordance with RCW
Chapter 40.14 and by the City.
9. Audits and Inspections. The records and documents with respect to all matters covered by this
Agreement shall be subject at all times to inspection, review or audit by law during the performance of
this Agreement.
10. Termination. This Agreement may at any time be terminated by the City giving to the Contractor
thirty (30) days written notice of the City's intention to terminate the same. Failure to provide
products on schedule may result in contract termination. If the Contractor's insurance coverage is
canceled for any reason, the City shall have the right to terminate this Agreement immediately.
11. Discrimination Prohibited. The Consultant, with regard to the work performed by it under this
Agreement, will not discriminate on the grounds of race, religion, creed, color, national origin, age,
veteran status, sex, sexual orientation, gender identity, marital status, political affiliation or the presence
of any disability in the selection and retention of employees or procurement of materials or supplies.
CA Revised 1 -2013 Page 3 of 4
12. Assignment and Subcontract. The Contractor shall not assign or subcontract any portion of the
services contemplated by this Agreement without the written consent of the City.
13. Entire Agreement; Modification. This Agreement, together with attachments or addenda,
represents the entire and integrated Agreement between the City and the Contractor and supersedes
all prior negotiations, representations, or agreements written or oral. No amendment or modification
of this Agreement shall be of any force or effect unless it is in writing and signed by the parties.
14. Severability and Survival. If any term, condition or provision of this Agreement is declared void or
unenforceable or limited in its application or effect, such event shall not affect any other provisions
hereof and all other provisions shall remain fully enforceable. The provisions of this Agreement,
which by their sense and context are reasonably intended to survive the completion, expiration or
cancellation of this Agreement, shall survive termination of this Agreement.
15. Notices. Notices to the City of Tukwila shall be sent to the following address:
City Clerk, City of Tukwila
6200 Southcenter Blvd.
Tukwila, Washington 98188
Notices to the Contractor shall be sent to the address provided by the Contractor upon the
signature line below.
16. Applicable Law; Venue; Attorney's Fees. This Agreement shall be governed by and construed in
accordance with the laws of the State of Washington. In the event any suit, arbitration, or other
proceeding is instituted to enforce any term of this Agreement, the parties specifically understand and
agree that venue shall be properly laid in King County, Washington. The prevailing party in any
such action shall be entitled to its attorney's fees and costs of suit.
DATED this 5 day of
CITY OF TUKWILA
72/
Finan ector, Peggy Mc $ by
CA Revised 1 -2013
, 2015
CONTRACTOR
Printed Name and Title: (24,6 114, T &ATM)
Address: PROS/ .0A/1-
16s t q 10754 A /la l &O /1J/Io//
Page 4 of 4
Attachment A Exhibit A B
ealthcare
16519 107th Place NE Bothell, WA 98011
t (425) 939 -7444 f (425) 939 -0089
w www,HealthcareActuaries,corn
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Actuaiies
h ors s,,r ay` to Itr sv itt Cost tEllecttive Cortsu'ting
November 20, 2014
Craig Zellerhoff
Fiscal Coordinator Payroll a Accounts Payable
City of Tukwila
6200 Southcenter Boulevard
Tukwila Washington 98188 -2544
Re: GASB Retirement Benefit Valuations
Dear Craig:
We are pleased to be able to provide the City of Tukwila ( "the City ") with its retiree benefits
valuations in the upcoming year. This letter outlines the information required from the City to
complete the December 31, 2014 valuation reports for the LEOFF 1 retiree healthcare (OPEB)
and the Firefighters' pension benefits. The letter also includes a project plan, deliverables,
and estimated fees.
Information Request
We have attached the information request as Exhibit 1 for the LEOFF 1 OPEB valuation and
Exhibit 2 for the Firefighters' pension valuation.
Project Plan Et Deliverables
A project plan, including tasks, deliverables, responsibilities, and the estimated time required
to complete each task follows. We will adjust the due dates to meet your needs.
Task
Deliverable
Responsible Due Date
Prepare information request
Prepare requested information and send to
Healthcare Actuaries
Provide discount rate
Scrub census data and load into valuation
system; prepare list of census and other
questions
Respond to census and other questions
Prepare proposed actuarial assumptions
Approve actuarial assumptions
Information
Request
Requested
Information
Short -Term
Interest Rate
List of Questions
Response to
Questions
Proposed
Assumptions
Assumption
Approval
ltr,ogh et 6.41nifore Benefits Cog 5arl2ing * Ac°tuarictE ys�
Healthcare
Actuaries
City
Completed
Jan. 23
City Jan. 23
Healthcare Jan. 27
Actuaries
City Jan. 29
Healthcare Jan. 30
Actuaries
City Feb. 3
Task
Deliverable
Responsible Due Date
Run and check valuations; quantify results;
prepare draft valuation reports
Approve draft reports
Prepare and submit final valuation reports
Draft Valuation
Report
Draft Report
Approval
Final Valuation
Report
Estimated Fees
Estimated fees to complete the work as outlined above are:
Healthcare
Actuaries
City
Healthcare
Actuaries
Statelhent Group) Task Fee
Valuation $3,500
2014 Full Valuation $3,500
$7,000
GASB 67 and 68 Firefighters 20
GABS 45
Total for 2014 Valuations
LEOFF 1
4 Ful
Feb. 6
Feb. 11
Feb. 13
The 2014 valuations will have a valuation date of January 1, 2015 and be completed in early
2015 according to the schedule above. Projected fees for the next two years are as follows:
Statemerit
GASB 67 and 68 Firefighters
GABS 45
LEOFF 1
5 Valuation Update $1,750
2015 Valuation Update $1,750
$3,500
Total for 2015 Valuations
GASB 67 and 68
GABS 45
Total for 2016 Valuations
Firefighters 2016 Full Valuation
LEOFF 1
2016 Valuation Update
$3,500
$1,750
$5,250
We do not anticipate changing the projected fees at this time, but we reserve the right to
change them. The fees above are for informational purposes and are guaranteed through the
end of 2014. If the City wishes to commit to a multi-year contract covering the 2015 and 2016
valuations, we will guarantee the fees above.
The basis for our estimated fees is:
• For the GASB 45 OPEB valuation:
o Valuation of one retiree medical plan
o Valuation of Medicare Part B premiums
o Valuation of nursing home costs
o Valuation of one retiree dental plan
o Valuation of one retiree vision plan
o Receipt of reasonably "clean" census data for active and retired employees
o Development of proposed assumptions (not including experience studies
required to update termination or retirement rates)
o Availability of reasonably "clean" paid claims and enrollment data for the
medical, Part B premiums, nursing home, dental, and vision plans
16519 107 Northeast I Bothell, VVashington 98011
t (425) 939-7444 I f (425) 939-0089 w www,HealthcareActuaries,com
GASB 45 INFORMATION REQUEST
Please provide a census with the following data fields for each of the LEOFF 1 retirees:
• Employee unique identifier
• Employee group: Fire or Police
• Date of birth
• Date of hire (optional)
• Retiree's gender
• Spouse's date of birth, if covered under the plan
• Date of retirement (optional)
• Coverage tier (for example, retiree only, retiree + spouse, and so on)
• Status (retired, disability retired, or other statuses)
Please provide a census with the following data fields for each of the actives who will be
eligible for LEOFF 1 retiree benefits:
• Employee unique identifier
• Employee group: Fire or Police
• Date of birth
• Date of hire
• Gender
• Coverage tier (for example, employee only, employee + spouse, and so on)
Census information should be as of December 31, 2014.
In addition to the census, please provide the following:
• The current value of retiree health plan assets as of December 31, 2014. To qualify as
"plan assets," the assets must be (a) segregated from general assets, and (b) be
restricted for use only to satisfy the obligation of the retiree medical plan). The
amount may be zero.
• The average return on short -term investments for the City. In addition, if known, the
average annual return on the retiree health plan assets.
Actual payments made on behalf of retirees during 2014 for all coverages, by
coverage, if available. Coverages include self - insured medical costs, HMO premiums,
dental costs, vision costs, nursing home costs and /or premiums, and Medicare Part B
premiums.
• Information on the average annual amount of uncovered health expenses paid from
general assets on behalf of LEOFF 1 retirees, excluding payments in the item above.
• Actual total retiree contributions for 2014, if available, and if there are any.
16519 107 "' Place Northeast Bothell, Washington 98011
t (425) 939 -7444 I f (425) 939 -0089 1 w www.HeaithcareActuaries.com
• For the GASB 67 and 68 pension valuation:
o Valuation of retirement benefits for members retired prior to March 1, 1970
o Valuation of retirement benefits for members retired since March 1, 1970
o No active or vested terminated members eligible
o Receipt of reasonably "clean" census data for retired employees
o Development of proposed assumptions (not including experience studies)
o Receipt of asset statements and change in assets for the prior two years
o To the extent available, prior valuation results
• Phone discussions regarding the project results, not to exceed three hours
Please let us know if you have any questions with respect to this project. We look forward to
working with you and your staff. Feel free to contact us at (425) 939-7444.
Sincerely,
Roger T. Burton, FSA, MAAA, FCA
16519 107tH Place Northeast ( Bothell, Washington 98011
t (425) 939-7444 I f (425) 939-0089 w www,HealthcareActuaries.com
GASB 67 and 68 INFORMATION REQUEST
Please provide a census with the following data fields for each of the retired firefighters:
• Employee unique identifier
• Date of birth
• Date of hire (optional)
• Retiree's gender
• Spouse's date of birth, if covered under the plan
• Date of retirement
• Monthly benefit payable as of December 31, 2014 and December 31, 2012 (prior census
date)
• Monthly benefit payable by LEOFF system as of December 31, 2014 and December 31,
2012 (prior census date)
• Form of monthly benefit
• Status (service retired, duty or non duty disability retired, or survivor status)
Please provide a census with the following data fields for each of the active firefighters who
will be eligible for a pension benefit:
• It is our understanding that there are no active or vested terminated members eligible
for benefits under the plan; please confirm.
Census information should be as of December 31, 2014.
In addition to the census, please provide the following:
• The current value of the Fund's assets as of December 31, 2014. To qualify as "plan
assets," the assets must meet the following criteria:
Contributions from employers and non - employer contributing entities to the
pension plan and earnings on those contributions are irrevocable.
• Pension plan assets are dedicated to providing pensions to plan members in
accordance with the benefit terms.
• Pension plan assets are legally protected from the creditors of employers, non -
employer contributing entities, and the pension plan administrator. If the plan
is a defined benefit pension plan, plan assets are also legally protected from
creditors of the plan members.
• Changes to the Fund's assets for the past two years (2013 and 2014), including
contributions, investment earnings and details of disbursements.
• A description of the Fund's investment strategy.
• A description of the pension benefit.
• Post- retirement increase percentages applied to benefits for the past two years for
both the wage increase and the CPI increase.
16519 107"' Place Northeast' Bothell, Washington 98011
t (425) 939 -7444 I f (425) 939 -0089 1 w www.HealthcareActuaries.corn