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RESOLUTION NO.
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~SOLUTION OF THE CITY OF SAN BERNARDINO AUTHORIZING THE
E~ECUTION OF AN AGREEMENT WITH ROBERT M. EPLER COMPANY, INC.
RELATING TO CONSULTING SERVICES rOR EMPLOYEES' GROUP INSURANCE
PLANS.
BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY
OF SAN BERNARDINO AS FOLLOWS:
SECTION 1. The Mayor of the City of San Bernardino is
hereby authorized and directed to execute on behalf of said City
an Agreement with Robert M. Epler Company, Inc. relating to con-
sulting services for employees' group insurance plans, a copy
of which is attached hereto, marked Exhibit "A" and incorporated
herein by reference as fully as though set forth at length.
I HEREBY CERTIFY that the foregoing resolution was duly
adopted by the Mayor and Common Council of the City of San
Bernardino at a .~~
on the /97i day of '
meeting thereof, held
, 1977, by the following
VQte, to wit:
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P:dv~d
?y~K City?erk
resolution is hereby approv his ~~ day
AYES:
NAYS:
ABSENT:
The foregoing
of )afi'''~//~ ,
,
1977 .
Bernardino
form:
I LED
DEe 2319Tf
'.UCILlE GOFORIH, City Clerk
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AGREEMENT
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(Employees' Group Insurance)
" THIS AGREEMENT is
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~municipal corporation,
made and entered into this S Ii day of
by and between the CITY OF SAN BERNARDINO
hereinafter called "City", and ROBERT M.
EPLER COMPANY, INC., a corporation, hereinafter called "Consultant
~ ! ! ~ ~ ~ ~ ~ T !!:
WHEREAS, Consultant has, pursuant to an agreement with
City dated June 15, 1977, performed certain consultant work in
connection with the City's employee group insurance program; and
WHEREAS, Consultant is well qualified and possesses all
consulting and actuarial qualifications necessary to render the
services to City set forth herein, and City enters into this
agreement in reliance upon Consultant's express representations
in regard thereto; and
WHEREAS, City desires to retain Consultant to prepare
adequate specifications acceptable for obtaining bids for employ-
ees' group insurance plans as set forth herein, to assist in
analyzing the bids that will be received for employee health and
life insurance coverage, including a dental plan, and to provide
a consulting service for a one year period after the health and
life insurance program bids have been awarded; and
WHEREAS, Consultant represents that it is ready, willing,
and able to serve City on the terms and conditions of this agree-
ment, and City enters into this agreement in reliance upon
Consultant's representations concerning its qtlalifications and
capabilities,
NOW, THEREFORE, in consideration of the mutual promises
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iand obligations of the parties set forth herein, City and Con-
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sultant agree as follows:
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1. Employment of Consultant. City hereby employs Con-
sultant to perform the following tasks and to prepare specifica-
tions and to assist the City in obtaining bids for revised health
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and life insurance coverage, including a dental plan. Consultant
7 shall:
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(a) Meet with City staff and discuss benefit revisions
9 and finalize funding alternatives. At the same time Consultant
10 shall obtain current employee data.
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(b) Determine the benefit revisions to be made and
12 calculate the costs for each benefit to be revised.
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(c) Evaluate the Blue Cross health plan accounting state-
14 ment for the October 31, 1977 year end and do all things necessary
15 to expedite the payment of a dividend.
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(d) Evaluate the standard of Oregon life plan accounting
17 statement for the November 30, 1977 year end and do all things
18 necessary to expedite the payment of a dividend.
19
(e) Develop a preliminary report concerning health plan
20 revisions and discuss various funding alternatives. Included
21 shall be estimated health plan reserves requirements, stop loss
22 insurance and budgeted rates for health plan revisions. A
23 separate section will be directed to bidding specifications for
24 the self-funded health plan and insured life plan. The plan shall
25 also consider dental insurance benefits.
26
(f) Meet with City staff to review Consultant's recom-
27 mendations and finalize the health plan to be self-funded; and to
28 select the insurance companies and claims payment administrators
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who are to receive proposals.
(g) Prepare bid specifications based on (i) an insurance
company insuring the life plan and/or providing administration
services for the health plan and (ii) a third party administrator
paying health claims.
(h) Assist the City in selecting the most economical
funding approach based on the proposals submitted. Consultant
shall include in this step interviews with representatives of
those organizations who are most competitive.
(i) Assist in the selection of the insurance company andl
or third party administrator chosen to administer the self-funded
health plan and to insure the life plan.
(j) Finalize implementation procedures.
(k) Develop a contract for a health plan.
(1) Develop an employee booklet for a health plan and a
life plan.
(m) with the advance written authorization of City, notify
'Blue Cross and Standard of Oregon of the termination of coverage.
Consultant shall establish how any excess reserves will be paid.
(n) Develop the final health plan reserves and budgeted
rates for the first year of the plan.
(0) Assist as required in the installation of the revised
funding program.
(p) Hold meetings with City's employees for the purpose
of describing the new program at a time determined by City.
(q) Provide such consulting and actuarial services as City
determines to be necessary in order to assist City during admin-
istration of the plan for the first year the plan is in effect.
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2. Approach of Consultant. The invitation to bid, pre-
pared by Consultant, shall be phrased so as to permit City to
select the most economical funding approach from among various
options. In addition to asking for bids for the present method,
the invitation to bid shall also permit bids to be submitted
combining health, dental and life insurance, and the like. The
options to be called for shall be:
(a) Same concept as presently used by City -
(1) Prototype health and accident insurance coverage,
with one firm responsible for the administration and payment of
claims for hospital and medical costs; and
(2) Separate life insurance firm.
(b) Same concept as at present but with only one insurance
firm -
(1) Life insurance firm would write the life as
well as handle the health and accident insurance.
(c) Revised concept whereby a self-funded health plan
would be administered by an outside firm (basically similar to
the claims-handling procedure for Workers' Compensation when the
City first became self-insured in 1971) -
(1) Life insurance firm would write the life insuranc
coverage, provide for administering the City-funded health plan,
and arrange with a third party to pay the claims.
(d) Same revised concept, but life insurance would be
separate from health -
(1) Life insurance to be written as at present; and
(2) City-funded health plan to be administered by a
separate firm, which would also pay the claims.
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3. Personnel. Consultant represents that he has, or will
secure at his own expense, all personnel required to perform the
services under this agreement. Consultant shall at all times be
and remain an independent contractor and such personnel as may be
employed by Consultant shall not be employees or agents of City.
4. Time of Performance. Services of Consultant are to
commence as soon as practicable after the execution of this agree-
ment. Consultant shall promptly perform his work and duties re-
quired hereunder and complete same in time to permit City to
implement Consultant's recommendations on or before February 1,
1978. Thereafter, Consultant shall provide its services required
under paragraph 1 subparagraph (q) hereinabove for a one year
period.
5. Compensation. City shall pay to Consultant a total
sum not to exceed eleven thousand dollars ($11,000.00) for all
work other than the follow-up consulting work set forth under
paragraph 1 subparagraph (q) hereinabove, and an additional sum of
five thousand dollars ($5,000.00) for services involved in pro-
viding the work set forth in paragraph 1 subparagraph (q) above,
to wit: providing consulting and actuarial services to assist in
the first year's plan administration. Said Consultant shall be
paid for his services as aforesaid in accordance with the followin
fee schedule, said sum to constitute full and complete compensa-
tion for Consultant's services rendered hereunder:
/ / / / /
/ / / / /
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Estimated
Man-Hours
Hourly
Rate
Fee
2
Group Insurance Consultant
90
50
190
330
$ 60
$ 5,400
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Consulting Manager
4
Consulting Actuary, Underwriter
60
40
3,000
7,600
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$16,000
7 In addition, City shall pay a sum not to exceed twelve
8 hundred dollars ($1200.00) for stenographic expenses, report
9 reproduction and travel. There shall be no other compensation
10 payable to Consultant hereunder, and Consultant shall be solely
11 responsible for paying for all expenses for services rendered to
12 City.
13 Consultant shall only bill City for actual expenses incurre
14 and for actual time expended.
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6. Method of Payment. Consultant shall bill for his work
16 on a monthly basis as the work progresses, and City shall promptly
17 pay said billings within the period of time normally used by
18 City for making such payments. Actual expenses provided for
19 hereinabove shall be billed by Consultant to City in said monthly
20 billings. The final payment to be made by City shall not be made
21 until such time as the Consultant has finally performed all work
22 required hereunder.
23
7. Warranties of Consultant. Consultant specifically
24 warrants and represents his skill and expertise to be adequate
25 and competent for the completion of his assignment hereunder in
26 a good and professional manner and the representations set forth
27 in the second and fourth Whereas Clauses hereinabove are incor-
28 porated herein by reference.
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Ii 8. Assignability. The experience, skill and expertise of
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, Consultant is of the essence of this agreement. Consultant shall
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not assign (whether by assignment or novation) this agreement or
delegate his duties hereunder in whole or in part or any right or
5 interest hereunder without the prior written consent of City. Any
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6 assignment or attempt to assign this agreement without such prior
7 written consent or by operation of law shall constitute cause for
8 termination.
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9. Interest of Consultant. Consultant covenants that he
10 presently has no interest and shall not acquire any interest,
11 direct or indirect, which would conflict in any manner or degree
12 with the performance of services required to be performed under
13 this agreement. Consultant further covenants that in the perform-
14 ance of this agreement no person having any such interest shall be
15 employed.
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10. Findings Confidential. Any reports, information, data,
17 etc., given to or prepared or assembled by Consultant under this
18 agreement which City requests to be kept as confidential shall not "
19 be made available to any individual or organization by Consultant
20 without the prior written approval of City.
21
11. PUblication, Reproduction and Use of Material. No
22 material produced in whole or in part under this agreement shall
23 be subject to copyright in the United States or in any other
24 country. The final report furnished by Consultant to City shall
25 become the sole property of City and City shall have unrestricted
26 authority to publish, disclose, distribute and otherwise use, in
27 whole or in part, any reports, data, or other materials prepared
28 under this agreement.
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12. Termination of Contract for Cause. If for any cause
Consultant shall fail to fulfill in a timely and proper manner
his obligations under this agreement, or if Consultant shall
violate any of the covenants, agreements or stipulations of this
agreement, City shall thereupon have the right to terminate this
agreement by giving written notice to Consultant of such termina-
tion and specifying the effective date thereof at least five (5)
days before the effective date of such termination. In that event
all finished and unfinished documents, data, studies, surveys,
drawings and reports or other material prepared by Consultant
under this agreement shall, at the option of City, become its
property and Consultant shall be entitled to receive just and
equitable compensation for any satisfactory work completed on
such documents and other materials.
Notwithstanding the above, Consultant shall not be relieved
of liability to City for damages sustained by City by virtue of
any breach of this agreement by Consultant, and City may withhold
any payments to Consultant for the purpose of set-off until such
time as the exact amount of damages due City from Consultant is
determined.
This agreement may not be terminated if the failure to
perform arises from unforeseeable cause beyond the control and
without the fault or negligence of Consultant.
13. Termination for Convenience of City. City may
terminate this agreement at any time by giving written notice to
Consultant of such termination and specifying the effective date
thereof at least fifteen (15) days before the effective date of
such termination. In such event, all finished and unfinished
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documents and other materials as described in paragraph 12 above
2 shall, at the option of City, become its property. If the agree-
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3 ment is terminated by City as provided herein, Consultant will be
4 entitled to be paid all compensation for work performed to the
5 date of termination, including all reimburseable expenses and
6 related costs. If termination is due to the fault of persons
7 other than Consultant, Consultant will be entitled to be paid all
8 compensation for work performed to the date of termination, in-
9 eluding all reimburseable expenses and related costs. Should this
10 agreement be terminated due to fault of Consultant, paragraph 12
11 hereof relative to termination shall be applicable.
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14. Changes. Should City require changes in the scope of
13 the services of Consultant to be performed hereunder, such changes
14 including any corresponding increase or decrease in the amount of
15 Consultant's compensation, which shall be mutually agreed upon by
16 and between City and Consultant, shall be incorporated in this
17 agreement only by written amendments hereto.
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15. Consultant to Hold Harmless. Consultant hereby agrees
19 to, and shall, hold City, its elective and appointive boards,
20 commissions, officers, agents and employees harmless from any
21 liability for damage or claims for damage for personal injury,
22 including death, as well as from claims for property damage which
23 may arise from Consultant's operations under this agreement,
24 whether such operations be by Consultant or by anyone or more
25 persons directly or indirectly employed by or acting as agent for
26 Consultant. Consultant agrees to and shall defend City and its
27 elective and appointive boards, commissions, officers, agents and
28 employees from any suits or actions at law or in equity for damage
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caused, or alleged to have been caused, by reason of any of the
2 aforesaid operations.
16. Time of Essence. Time is of the essence with respect
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4 to Consultant's performance under this agreement.
17. Notices. All notices herein required shall be in
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6 writing and delivered in person or sent by certified mail, postage
7 prepaid, addressed as follows:
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City of San Bernardino
300 North "0" Street
San Bernardino, CA 92418
Robert M. Epler Company, Inc.
The Fox Building
770 "13" Street~ Suite 417
San Diego, CA 92101
11 IN WITNESS WHEREOF, the parties hereto have executed this
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12 agreement on the date first hereinabove written.
13 CITY OF
ATTEST:
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s to form:'
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ROBERT M. EPLER COMPANY, INC.
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