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HomeMy WebLinkAboutCORRESPONDENCE - RFP - P748 ACTUARIAL PENSION CONSULTING SERVICESA MILLIMAN GLOBAL FIRM Millimanusa Consultants and Actuaries June 4, 2004 Mr. James B. O'Neill, II, CPPO, FNIGP Director Of Purchasing and Risk Management City of Fort Collins 215 North Mason Street, 2nd Floor P.O. Box 580 Fort Collins, Colorado 80522-0580 RE: Addendum to the Professional Services Agreement Dear Jim: 1099 Eighteenth Street, Suite 3100 Denver, CO 80202-1931 Tel +1 303 299.9400 Fax +1 303 299.9018 www.milliman.com Enclosed are two signed copies of the Addendum to the Professional Services Agreement. Two additional sentences have been added to Exhibit "B" at your request. Please return one of the copies of the agreement to us for our files We appreciate your business. We look forward to the opportunity to continue to assist you in the servicing of your plan. Sincerely, tu" R , to �..�,✓ Nancy R. Wagner, F.S.A. Principal and Consulting Actuary NRW:pak Enclosures j:docs:cfc:040102serviceagreementadr�endUrn OPRINCIPAL NC PAL CITIES WORLDWIDE Addendum to the Professional Services Agreement For the City of Fort Collins, Colorado and Milliman USA This addendum applies to the Professional Services Agreement dated July 1, 2000 (Agreement) entered into by the City of Fort Collins, Colorado ("City") and Milliman USA, Inc. (Williman") The parties agree to the following modification to item 6, sentence number two: "The professional shall indemnify, save and hold harmless the City its officers and employees, in accordance with Colorado law, from all damages whatsoever claimed by third parties against the City and for the City's costs and reasonable attorneys fees arising directly or indirectly out of the Professional's negligent performance of any of the services furnished under this Agreement. The parties agree to add the following provisions: 16. Limitation of Liability. Milliman will perform all services in accordance with applicable professional standards and shall correct or re -perform any services found to be defective. The parties agree that Milliman shall not be liable to City for damages in any tort or contract claim, including, but not limited to, claims for professional negligence, malpractice or breach of contract, where such damages exceed $1,000,000. In no event shall Milliman be liable for any incidental or consequential damages. The foregoing limitations shall not apply in the event of the intentional fraud or willful misconduct of Milliman. The provisions of this Section will survive the expiration or termination of the Agreement. 17. No Third Party Distribution Third Party Distribution. The Actuary's work product is prepared for the use and benefit of the City in accordance with its statutory and regulatory requirements. The Actuary recognizes that materials it delivers to the City may be public records, subject to disclosure to third parties. However, the Actuary does not intend to benefit and assumes no duty or liability to any third parties. The Actuary intends to include a footer on each page of its work product as follows: This work product was prepared solely to provide assistance to the City of Fort Collins. It may not be appropriate to use for other purposes. Milliman does not intend to benefit and assumes no duty or liability to other parties who receive this work." The City agrees to provide full page copies, including such footer, to any third parties who are provided a copy of the Actuary's work product, or when posting Actuary's work product to an intranet site. 18. Dispute Resolution Mediation. In the event of any dispute arising out of or relating to the engagement of Milliman by the City, the parties agree first to try in good faith to settle the dispute voluntarily with the aid of an impartial mediator who will attempt to facilitate negotiations. A dispute will be submitted to mediation by written notice to the other party or parties. The mediator will be selected by agreement by the parties. If the parties cannot agree on a mediator, a mediator will be designated by the American Arbitration Association at the request of a party. JADOCUMENTS\CFC\Addendum to Professional Services Agree.doc The mediation will be treated as a settlement discussion and therefore will be confidential. Any applicable statute of limitations will be tolled during the pendency of the mediation. Each party will bear its own costs in the mediation. The fees and expenses of the mediator will be shared equally by the parties. Arbitration. If the dispute has not been resolved within 60 days after the written notice beginning the mediation process (or a longer period, if the parties agree to extend the mediation), the mediation will terminate, and the dispute will be resolved by final and binding arbitration under the Commercial Arbitration Rules of the American Arbitration Association. The arbitration will take place in Denver, Colorado, before a panel of three arbitrators. Within 30 days of the commencement of the arbitration, each party will designate in writing a single neutral and independent arbitrator. The two arbitrators designated by the parties will then select a third arbitrator. The arbitrators will have a sufficient background in either employee benefits, actuarial science, or law to reasonably prepare them to decide a dispute. The arbitrators will have the authority to permit limited discovery, including depositions, prior to the arbitration hearing, and such discovery will be conducted consistent with the Federal Rules of Civil Procedure. The arbitrators will have no power or authority to award punitive or exemplary damages. The arbitrators may, in their discretion, award the cost of the arbitration, including reasonable attorney fees, to the prevailing party. Any award made may be confirmed in any court having jurisdiction. Any arbitration shall be confidential, and except as required by law, neither party may disclose the content or results of any arbitration hereunder without the prior written consent of the other parties, except that disclosure is permitted to a party's auditors and legal advisors. THE CITY OF FORT COLLINS, COL'ORAADO By: Jam s B O'Neill, CPPO:: Directo of Purchasing & Risk Management Date: - (,/7/0L1 MILLIMAN USA By: /uaMA, R. toaf ,V\" Nancy R. Wagner Principal Date: SinRc 4, JADOCUMENTS\CFC\Addendum to Professional Services Agree.doc EXHIBIT "B" Subsequent Years Annual Valuation Report $7,800 Preparation of Personal Retirement Planning Statements $2,600 Review and Maintenance of Benefit Software $ 520 Attendance at Monthly General Employee Retirement Committee Meetings (12 meetings x $624 per meeting, up to 3 hours per meeting, no charge for travel time or other expenses) $7 488 Benefit Calculation Charges Benefit calculations performed by Professional, not more than one (1) hours required: $ 156 Benefit calculation performed by City, verified by Professional, Y2 hours or less required: $ 78 Domestic Relations Order review and verification of benefit Calculations, on Committee -approved forms: $ 156 Hourly Billing Rates for Work Orders and Special Projects Consulting Actuaries $156-312 per hour Associate Actuaries $ 99-146 per hour Actuarial Staff and Analysts $ 52-94 per hour Support Staff $ 31-62 per hour If agreed by the Retirement Committee, specific employees may be billed at their current billing rates. The 2005 rates will be set when the CPI numbers are available. J:\DOCUMENTS\CFC\Addendum to Professional Services Agree.doc