HomeMy WebLinkAboutPR 19189: CONSULTING CONTRACT WITH GABRIEL ROEDER SMITH & CO., CONSULTANTS & ACTUARIES City of Port Arthur
Memorandum
To: Brian McDougal, City Manager
From: Jerry W. Dale, Interim Director of Finance
Date: October 15, 2015
Re: PR 19189
I recommend that the City Council adopt Proposed Resolution 19189 which authorizes a
consulting services contract with Gabriel Roeder Smith & Co., Consultants & Actuaries, related to
the City's Other Post Employment Benefit (OPEB), Retiree Health Insurance Plan.
P.R. 19189
JNP: 10/15/15
RESOLUTION NO.
A RESOLUTION AUTHORIZING A CONSULTING
CONTRACT FOR THE SERVICES OF GABRIEL
ROEDER SMITH & CO., CONSULTANTS &
ACTUARIES (GRS) RELATED TO THE CITY'S OTHER
POST EMPLOYMENT BENEFIT (OPEB), RETIREE
HEALTH INSURANCE PLAN BUDGETARY IMPACT•
OF $11,000.00 ACCOUNT NO. 614-1701-583.52-00
WHEREAS, an updated actuarial study is required in 2015; and
WHEREAS, GRS is a professional company whose business is to perform actuarial
services and provide employee benefits analysis and is deemed qualified to provide said services;
and
WHEREAS,the City of Port Arthur can receive services from GRS under the Shared
Services arrangement provided by GRS and North Central Texas Council of Governments, as
described in Exhibit A-1, at a substantial savings to the City; and
WHEREAS, this procurement is an exception to competitive bidding competitive
proposal pursuant to 252.022 (A) (4)of the Texas Local Government Code.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
PORT ARTHUR:
THAT the City Manager of the City of Port Arthur is hereby authorized and directed to
execute on behalf of the City of Port Arthur a consulting contract between the City and Gabriel
Roeder Smith& Co. to perform actuarial services related to the City's Other Post Employment
Benefit(OPEB); and
THAT a copy of said SCOPE OF SERVICES is attached hereto and made a part hereof
as Exhibit "A"; and,
THAT a copy of the caption of this resolution be spread upon the Minutes of the City
Council.
READ,ADOPTED,AND APPROVED,this day of October,2015 A.D., at a
Regular Meeting of the City Council of the City of Port Arthur, Texas by the following vote:
AYES: Mayor:
Council members:
NOES:
Deloris Prince, Mayor
ATTEST:
Sherri Bellard, City Secretary
APPROVED AS TO FORM:
Q C
Val Tizeno, CitO Attorney
APPROVED FOR ADMINISTRATION:
Brian McDougal, City Manager
APPROVED AS TO AVAILABILITY OF FUNDS:
JerryW. Dale, Interim Finance Director
EXHIBIT "A"
STATE OF TEXAS
*
COUNTY OF JEFFERSON
PROFESSIONAL SERVICES CONTRACT
This instrument is a contract between Gabriel Roeder Smith & Co., 5605 N. MacArthur Blvd,
Suite 870, Irving, TX 75038 telephone number 469-524-0000, whose business is to perform
actuarial services and provide employee benefits analysis hereinafter denoted as "Professional",
and the City of Port Arthur, hereinafter denoted as "City".
SCOPE OF SERVICES/PRICE:
This contract authorizes Professional to perform professional services as described in Exhibit "A-
1". The compensation for the Professional at the hourly rates as stated in the Engagement Letter
attached here to as Exhibit"A-1" $11,000.00.
TERM:
The maximum term of this agreement shall be the lesser of(a) three months, (b) when the project
described in Exhibit "A-1" is completed or (c) when the professional is terminated under the
"Termination of Professional" clause.
PROGRESS REPORTS:
The professional shall provide progress reports as reasonably requested by the City's
Representative.
PERSONNEL OF PROFESSIONAL:
DESIGNATION OF OWNER(CITY'S) REPRESENTATIVE AND DUTIES THEREOF:
a. The City Manager or his designee shall act as City's Representative.
b. The City's Representative shall use his best efforts to provide City
records for professional's usage on this project.
STANDARDS OF PERFORMANCE:
a. The Professional shall perform all services under this Agreement in
accordance with the standards of the profession specializing in the scope
of services as described in Exhibit "A-1".
b. Codes and Standards
Professional agrees the services it provides as an experienced
and qualified provider will reflect the professional standards,
procedures, and performances common in the industry.
SCHEDULE:
The Professional shall not proceed with the project or any stage thereof until written notice
to proceed is provided by the City's representative. The project schedule will commence as
detailed in Exhibit "A-1".
INSURANCE:
a. The Professional shall procure and maintain insurance in the amounts listed below
for protection from claims under Worker's Compensation, claims for damages
because of bodily injury, including personal injury, and from claims or damages
because of injury to or destruction of property including loss of use resulting
therefrom. The Professional shall provide a copy of the insurance certificate to the
City.
Coverage Limit of Liability
Worker's Compensation Statutory for Worker's
Compensation
Employer's Liability Bodily Injury by Accident
$1,000,000 (Each Accident)
Bodily Injury by Disease
$1,000,000 (Policy Limit)
Bodily Injury by Disease
$1,000,000 (Each Employee)
Commercial General: Bodily Injury and
Including Broad Form Property Damage, Combined
Coverage, Contractual Limits of$500,000 each
Liability, Bodily and Occurrence and $1,000,000
Personal Injury, and aggregate (defense costs
Completed Operations excluded from face amount
of policy)
b. The Professional shall maintain professional liability (errors and
omissions/malpractice) insurance in the amount of$1,000,000. The Professional
shall provide a copy of his insurance policy to the City within 10 days of contract
execution or this contract shall be null and void. A deductible is acceptable for
professional liability insurance.
c. The Professional shall give the City thirty (30)days notice prior to any change or
cancellation of these insurance policies.
LIABILITY:
The Professional shall be liable only for the services performed by the Professional and
shall be responsible for only the negligent acts or omissions that the Professional has direct
control over.
SUB-CONSULTANTS AND SUB-CONTRACTORS:
The Professional shall receive written approval of the City's Representative prior to the use
of sub-consultants and/or sub-contractors.
TERMINATION OF PROFESSIONAL:
The City retains the right to terminate the contract "at will" and to pay only for the
professional services and sub-consultant's and subcontractor's costs that were provided for
and/or that were committed to and that were City approved prior to the termination.
RECORDS:
At the City's request,the City will be entitled to review and receive a copy of all
documents that indicate work on the project.
BILLINGS:
The City will process interim progress billings and shall have up to thirty (30) days to pay
bills. All bills must demonstrate in detail the services completed.
REPUTATION IN THE COMMUNITY:
The Professional shall asserts that there is no pending litigation that would impact its
ability to provide professional services to the City.
PAYROLLS AND BASIC RECORDS:
a. The Professional shall maintain payrolls and basic payroll records during the course
of the contract work and shall preserve them for a period of three years from the
completion of the contract for all personnel working on the contract.
b. The records to be maintained under paragraph(a) of this clause shall be made
available by the Professional for inspection, copying, or transcription by the City or
their authorized representatives. The Professional shall permit such representatives
to interview employees during working hours on the job. The city will review such
records for billing reconciliation purposes as needed.
DEFAULT OF PROFESSIONAL:
a. If the Professional refuses or fails to prosecute the work or any separable part, with
the diligence that will insure its completion within the time specified in this
contract, or fails to complete the work within this time,the City may, by written
notice to the Professional, terminate the right to proceed with the work(or the
separable part of the work)that has been delayed. In this event,the City may take
over the work and complete it by contract or otherwise, and may take possession of
and use any records necessary for completing the work. The Professional shall be
liable for any damage to the City resulting from the Professional's refusal or failure
to complete the work within the specified time, whether or not the Professional's
right to proceed with the work is terminated. This liability includes any increased
costs incurred by the City in completing the Professional's work.
b. The Professional shall not be charged with damages under this clause if,
(1) The delay in completing the work arises from unforeseeable causes beyond
the control and without the fault or negligence of the Professional.
Examples of such causes include (i) acts of God or of the public enemy, (ii)
acts of the Government in either its sovereign or contractual capacity, (iii)
acts of another contractor or Professional in the performance of a contract
with the Government, and/or extended review or approvals by government
agencies out of the control of the Professional, (iv) acts of fire, (v) floods,
(vi) epidemics, (vii) quarantine restrictions, (viii) strikes, (ix) freight
embargoes, (x)unusually severe weather, or(xi)delays of subcontractors or
suppliers at any tier arising from unforeseeable causes beyond the control
and without the fault or negligence of the Professional; and
(2) The Professional, within 10 days from the beginning of any delay
(unless extended by the City's Representative), notifies the City's
Representative in writing of the causes of delay. The City's Representative
shall ascertain the facts and the extent of delay. If, in the judgment of the
City's Representative, the findings of fact warrant such action, the time for
completing the work shall be extended. The findings of the City's
Representative shall be final and conclusive on the parties, but subject to
appeal to City Council.
c. The rights and remedies of the City in this clause are in addition to any other rights
and remedies provided by law or under this contract.
APPLICABLE LAW:
This contract has been made under and shall be governed by the laws of the State of Texas. The
parties agree that performance and all matters related thereto shall be in Jefferson County, Texas.
NOTICES:
Notices shall be mailed to the addresses designated herein or as may be designated in writing by
the parties from time to time and shall be deemed received when sent postage prepaid U.S. Mail to
the following addresses:
CITY:
City of Port Arthur
Attention: Jerry W. Dale
Interim Director of Finance
P. O. Box 1089
Port Arthur, Texas 77641
PROFESSIONAL:
Gabriel Roeder Smith & Company
5605 N. MacArthur Blvd.
Suite 870
Irving, TX 75038
WAIVER:
No waiver by either party hereto of any term or condition of this agreement shall be deemed or
construed to be a waiver of any other term or condition or subsequent waiver of the same term or
condition.
This Agreement represents the entire and integrated agreement between City and
Professional and supersedes all prior negotiations, representations or agreements, either written or
oral. This agreement may only be amended by written instrument approved and executed by the
parties. The City of Port Arthur and Professional, accept and agree to these terms.
SIGNED ON THE day of , 2015.
BY:
Attest:
SIGNED ON THE day of , 2015.
CITY OF PORT ARTHUR, TEXAS
BY:
Brian McDougal, City Manager
Attest:
Sherri Bellard
City Secretary
Exhibit A-1
GRS Gabriel Roeder Smith& Company
Consultants 8c Actuaries 5605 N.MacArthur Blvd. 469.524.0000 phone
Suite 870 469.524.0003 fax
Irving,TX 75038-2631 www.gabrielroeder.com
October 20, 2015
Mr. Jerry Dale
Interim Finance Director
City of Port Arthur
444 4th Street
Port Arthur,Texas 77640
Re: Engagement Letter for GASB OPEB Valuation for Port Arthuur
Dear Mr. Dale,
You have requested a pricing quote for a GASB 45 actuarial valuation under the Shared Services
arrangement provided by Gabriel, Roeder, Smith&Co(GRS)and North Central Texas Council of
Governments(NCTCOG).
Based on the information you provided,the estimated cost of services for Port Arthuur is$10,545. The total
fee including the $125 NCTCOG administration fee will equal$10,670. This price is based on receiving
data in the standard GRS format and using the following assumptions:
Number of Participants 500- 999
Claims Analysis Required Yes
Retirement Plans 1. TMRS
2. Firefighter Pension Plan
Health Plans 1. City of Port Arthur Health Plan
Annual,Biennial,or Triennial Biennial
Pricing Discount Not Eligible
Additional fees may also apply if the data is not received in the requested GRS data format.
If other assumptions are identified, a revised proposal letter will be prepared by GRS.
Basic Services
Basic services provided through the Shared Services program will include:
• Actuarial valuation of employer OPEB in compliance with the requirements of paragraphs
11-27 of GASB 45. Valuations can be performed annually or biennially and will include:
> A measurement of the actuarial liability,present value of projected benefits and
normal cost as of the valuation date
Mr. Jerry Dale
October 20,2015
Page 2
> The estimated actuarially determined contribution for the applicable fiscal years
> The estimated annual required contribution and accounting expense for the
applicable fiscal years as required under GASB Statement Nos. 43 and 45
> Information needed to complete the"Notes to the Financial Statement"and
"Required Supplementary Information"as defined in paragraphs 30 and 31 of GASB
No. 43
> Information needed to complete the"Notes to the Financial Statement"and
"Required Supplementary Information"as defined in paragraphs 24, 25 and 26 of
GASB No. 45
> Sensitivity analysis for health care trend rates,providing valuation results based on a
higher and a lower health care trend
> A hypothetical set of actuarial results using an alternative discount rate based on
pre-funding
• Two in person or conference call meetings as mutually agreed upon by Port Arthuur and GRS. Out of
pocket travel expenses for governments located 100 miles or more from DFW Airport will be charged
to the government.
Billing Schedule
GRS pricing assumes 20%paid upon acceptance by the government of the engagement, 50%upon
receipt of the draft report and 30%upon acceptance of the final report. For Biennial or Triennial
valuations,GRS will provide the OPEB cost for the off year(s)and will walk forward the Net
OPEB Obligation.
The GRS prices discussed above will be adjusted annually in January based on changes in the
Consumer Price Index,All Urban Consumers,on a December over December basis.
GRS billing will also include an administrative fee of$125 per valuation cycle payable to the
NCTCOG.
Gabriel Roeder Smith &Company
Mr. Jerry Dale
October 20,2015
Page 3
Options Study
It is anticipated that Port Arthuur may want to consider what the options are for mitigating their OPEB
liability. These Options studies would include alternative discount rates, alternative healthcare trend rates,
benefit capitations,and changes in retiree cost sharing. The cost for a basic Options study will be $1,230 per
study.
More complicated studies may not be covered under the fixed fee amount above. If a study is not
included in the fixed fee pricing,the hourly rates shown in"Additional Services" below will apply
or fixed fee amounts will be negotiated. GRS will provide written documentation of our
understanding of the service(s)requested,the estimated number of hours by employee class,total
costs and project timeline.
Additional Services
Fees for additional consulting services not included under Basic Services or included in the fixed
fee Options studies will be priced separately upon request and will be based on the following hourly
rates:
Hourly
GRS Resource Classification Rates
Senior Consultants $415
Consultants $325
Senior Analysts $205
Actuarial Analysts $175
Systems Analysts and Programmers $230
Administrative Support Staff $130
A copy of this engagement letter will be made a part of the master agreement between Port Arthuur and GRS.
If you have any questions or need additional information please don't hesitate to email us at
sharedservices.NCTCOG@gabrielroeder.com or call either Mehdi Riazi at 469-524-1343 or Blake
Orth at 469-524-1817.
Thank you for your interest in the Shared Services program.
Gabriel Roeder Smith &Company