Gallagher Benefit Services Renewal Proposal 2019 Copyrighted
August 5, 2019
City of Dubuque Consent Items # 26.
ITEM TITLE: GallagherBenefitServices Renewal Proposal
SUMMARY: City Manager recommending approval of theAmendment
to the Administrative Services Agreement with Gallagher
Benefit Services, I nc. for benefit and actuarial services
effective July 1, 2019 through June 30, 2020; and
authorization for the City Manager to sign the Amendment.
SUGGESTED DISPOSITION: Suggested Disposition: Receiveand File;Approve
ATTACHMENTS:
Description Type
Gallagher Benefit Services Renewal Proposal-MVM City Manager Memo
Memo
Staff Memo Staff Memo
Amendment Supporting Documentation
Insurance Schedule J Supporting Documentation
Agreement Supporting Documentation
Dubuque
THE CITY OF �
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TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Gallagher Benefit Services Renewal Proposal
DATE: July 31, 2019
Human Resources Director Randy Peck recommends City Council approval of the
Amendment to the Administrative Services Agreement with Gallagher Benefit Services,
Inc. for benefit and actuarial services at an annual fee of $34,500, effective July 1, 2019,
through June 30, 2020, and authorization for the City Manager to sign the Amendment.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
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Mic ael C. Van Milligen
MCVM:jh
Attachment
cc: Crenna Brumwell, City Attorney
Teri Goodmann, Assistant City Manager
Cori Burbach, Assistant City Manager
Randy Peck, Human Resources Director
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THE CITY OF
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TO: Michael C. Van Milligen, City Manager
FROM: Randy Peck, Human Resources Director � �',
SUBJECT: Gallagher Benefit Services Renewal Proposal
DATE: July 30, 2019
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I received the attached Renewal Proposal from Gallagher Benefit Services, Inc., for
benefit consulting and actuarial services. The annual fee will remain at $34,500.
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I recommend that the City Council approve the Amendment to the Administrative j
Services Agreement with Gallagher Benefit Services, Inc., for benefit and actuarial '
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services at an annual fee of$34,500, effective July 1, 2019 through June 30, 2020, and
authorize you to sign the Amendment.
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Attachment
AMENDMENT TO
GALLAGHER BENEFIT SERVICES, INC.
AGREEMENT
The Consulting Agreement by and between Gallagher Benefit Services, Inc. ("Gallagher") and The City
of Dubuque, Iowa (the "Client"), effective October 1, 2002, and subsequently amended July 1, 2016,
January 1, 2017 and May 1, 2017, is hereby amended as set forth below.
Effective July 1, 2019:
Section II(A) TER]'I - hereby reflects the terra of this Agreement is extended through June 30,
2020.
2. Section III0)(1) — Obligations of Client - is hereby modified and amended to reflect fee payable to
Gallagher as follows:
Beginning July 1, 2019, Gallagher shall be compensated in an amount of $34,500 per year.
All other terms and conditions of the Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed.
GALLAGHER BE, FIT SERVICES, INC. CITY OF DUBUQUE, IOWA
By: By:
Name:di4cAafs,.., _ Name: Michael C. Van Milligen
Title: Are �' Title: City Manager
Date: 773 �f (9 Date: j
City of Dubuque Insurance Requirements for Professional Services
INSURANCE SCHEDULE J �
Gallagher Benefit Services, Inc. �
1. shall furnish a signed certificate of insurance to the City of Dubuque, lowa for
the coverage required in Exhibit I prior to commencing work and at the end of the project if the
term of work is longer than 60 days. Contractors presenting annual certificates shall present a
certificate at the end of each project with the final billing. Each certificate shall be prepared on
the most current ACORD form approved by the lowa Department of Insurance or an equivalent
approved by the Director of Finance and Budget. Each certificate shall include a statement under
Description of Operations as to why the certificate was issued. Eg: Project# or Project
Location at or construction of
2. All policies of insurance required hereunder shall be with an insurer authorized to do business in
lowa and all insurers shall have a rating of A or better in the current A.M. Best's Rating Guide.
3. Each certificate shall be furnished to the Finance Department of the City of Dubuque.
4. Failure to provide coverage required by this Insurance Schedule shall not be deemed a waiver of
these requirements by the City of Dubuque. Failure to obtain or maintain the required insurance
shall be considered a material breach of this agreement.
5. Contractors shall require all subconsultants and sub-subconsultants to obtain and maintain during
the performance of work insurance for the coverages described in this Insurance Schedule and
shall obtain certificates of insurances from all such subconsultants and sub-subconsultants.
Contractors agree that they shall be liable for the failure of a subconsultant and sub-
subconsultant to obtain and maintain such coverages. The City may request a copy of such
certificates from the Contractor.
6. All required endorsements shall be attached to certificate of insurance.
7. Whenever a specific ISO form is listed, required the current edition of the form must be used, or
an equivalent form may be substituted if approved by the Director of Finance and Budget and
subject to the contractor identifying and listing in writing all deviations and exclusions from the
ISO form.
8. Contractors shall be required to carry the minimum coverage/limits, or greater if required by law
or other legal agreement, in Exhibit I. If the contractor's limits of liability are higher than the
required minimum limits then the provider's limits shall be this agreemenYs required limits.
9. Contractor shall be responsible for deductibles and self-insured retention.
Page 1 of 4 Schedule J Professional Services May 2019
City of Dubuque Insurance Requirements for Professional Services �!
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INSURANCE SCHEDULE J (continued)
Exhibit I
A) COMMERCIAL GENERAL LIABILITY
General Aggregate Limit $2,000,000
Products-Completed Operations Aggregate Limit $1,000,000
Personal and Advertising Injury Limit $1,000,000
Cach Occurrence $1,000,000
Fire Damage Limit(any one occurrence) $50,000
Medical Payments $5,000
1) Coverage shall be written on an occurrence, not claims made, form. The general '
liability coverage shall be written in accord with ISO form CG 00 01 or business ,
owners form BP 00 02. All deviations from the standard ISO commercial general ',
liability form CG 00 01, or business owners form BP 00 02, shall be clearly
identified.
2) Include ISO endorsement form CG 25 04"Designated Location(s)General ,
Aggregate Limit"or CG 25 03"Designated Construction Project(s)General
Aggregate Limit" as appropriate.
3) Include endorsement indicating that coverage is primary and non-contributory.
4) Include Preservation of Governmental Immunities Endorsement. (Sample
attached).
5) Include additional insured endorsement for:
The City of Dubuque, including all its elected and appointed officials, all its
employees and volunteers, all its boards, commissions and/or authorities and
their board members, employees and volunteers. Use ISO form CG 20 26.
6) Policy shall include Waiver of Right to Recover from Others endorsement. :
B) AUTOMOBILE LIABILITY
Combined Single Limit $1,000,000
C) WORKERS' COMPENSATION & EMPLOYERS LIABILITY
Statutory Benefits covering all employees injured on the job by accident or disease as
prescribed by lowa Code Chapter 85.
Coverage A Statutory—State of lowa
Coverage B Employers Liability
Each Accident $100,000
Each Employee-Disease $100,000
Policy L.imit-Disease $500,000
Policy shall include Waiver of Right to Recover from Others endorsement.
Coverage B limits shall be greater if required by the umbrella/excess insurer.
OR
Nonelection of Workers' Compensation or Employers' Liability Coverage under lowa
Code sec. 87.22. Completed form must be attached.
Page 2 of 4 Schedule J Professional Services May 2019
City of Dubuque Insurance Requirements for Professional Services
INSURANCE SCHEDULE J (continued) �
D) UMBRELLA/EXCESS LIABILITY $1,000,000 �
Umbrella/excess liability coverage must be at least following form with the underlying
policies included herein (General Liability, Automobile, Workers Compensation).
E) PROFESSIONAL LIABILITY $1,000,000
Provide evidence of coverage for 5 years after completion of project,
F) CYBER LIABILITY $1,000,000
�C yes no
Coverage for First and Third Party liability including but not limited to lost data and
restoration, loss of income and cyber breach of information.
Page 3 of 4 Schedule J Professional Services May 2019
City of Dubuque Insurance Requirements for Professional Services .
PRESERVATION OF GOVERNMENTAL IMMUNITIES ENDORSEMENT
1. Nonwaiver of Governmental Immunitv. The insurer expressly agrees and states that the purchase
of this policy and the including of the City of Dubuque, lowa as an Additional Insured does not waive any
of the defenses of governmental immunity available to the City of Dubuque, lowa under Code of lowa
Section 670.4 as it is now exists and as it may be amended from time to time.
2. Claims Coveraqe. The insurer further agrees that this policy of insurance shall cover only those
claims not subject to the defense of governmental immunity under the Code of lowa Section 670.4 as it
now exists and as it may be amended from time to time. Those claims not subject to Code of lowa �
Section 670.4 shall be covered by the terms and conditions of this insurance policy.
3. Assertion of Government Immunitv. The City of Dubuque, lowa shall be responsible for asserting
any defense of governmental immunity, and may do so at any time and shall do so upon the timely written
request of the insurer.
4. Non-Denial of Coveraqe. The insurer shall not deny coverage under this policy and the insurer
shall not deny any of the rights and benefits accruing to the City of Dubuque, lowa under this policy for
reasons of governmental immunity unless and until a court of competentjurisdiction has ruled in favor of
the defense(s)of governmental immunity asserted by the City of Dubuque, lowa.
No Other Chanqe in Policv. The above preservation of goyernmental immunities shall not otherwise
change or alter the coverage available under the policy. ,
(DEPARTMENT MANAGER: FILL IN ALL BLANKS AND CHECK BOXES)
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Page 4 of 4 Schedule J Professional Services May 2019
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AGREEMENT
THIS AGItEEMENT is made and entered into this lst day of October 2002 by and between The City of Dubuque,
Iowa ("clienY')and GALLAGHER BENEFIT SERVICES,INC.,a Delaware corporation("Gallagher"),
I. RECITALS
A. Client desires to receive professional consulting services for its Employee Benefit Program (the
"Program"). The Program includes coverage for life, medical, dental, prescription drugs, workers
compensation and flexible spending account benefit plans,
B. Gallagher is engaged in the business of advising its clients on their insurance needs and procuring insurance
on behalf of its clients as an insurance consultant.
C. Gallagher desires to provide certain consulting services and Client desires to have Gallagher provide such
consulting services in accordance with the terms hereof.
II. TERM&TERMINATION
A. TEIZM
This Agreement shall be effective for an initial term commencing October 1,2002, and shall remain in fiill force and
effect until June 30, 2003. Thereafter, this Agreement shall be automatically renewed for successive one (1) year
terms until terminated as provided herein.
B. TERMINATION
Either party may terminate this Agreement, with or without cause, upon the conclusion of the initial term or the
conclusion of any successive renewal term by providing thirty(30)days written notice prior to the conclusion of any
term, In the event eithar party materially breaches this Agreement at any time, this Agreement shall ternunate upon
the failure of the breaching party to remedy the breach wittun thirty (30) days of receipt of written notice of the
breach.
III. AGREEMENT
A. Obligations of Gallagher
1. Financial Reports
Gallagher will prepare an annual report analyzing claims experience, benefits paid, contributions,
admuustrative expenses, gross and net cost of insured benefits, net cost of any self-insured coverages and
other relevant items that pertain to the plans. Gallagher will also provide up to two interim financial
reports for the self-funded plans per contract year that will allow the City to monitor the performance of
those plans,
The annual report includes a projected income and expense budget based on an analysis of prior
experience and known or anticipated factors affecting future operations. Together with an evaluation of
the plan's reserve position, this budget serves as a guide to financial and bene�it planning decisions.
2. Consultation
Gallagher will be available for consultation on many aspects of the plan's operation including claims,
reserves, and insurance company performance, as well as the plan's overall progress and development.
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Gallagher is available to consult with the City's legal counsel and the plan administrator regarding
changes to be made in the plan of benefits and eligibility for such benefits.
3. Benefit Chan�es
Gallagher will provide advice and then take appropriate action as authorized by the City for implementing
any bene�t changes including revision in premium and plan recordkeeping procedures, master policy
certificates, and booklet amendments or modifications, '
4. Insurance Company NeQotiations I
As authorized by the City, Gallagher will negotiate with the insurance companies to obtain appropriate
adjustments, In the event that an insurance company's proposed annual retention is not consistent with its
projection or if the renewal premium rates do not appear justified by claims experience, Gallagher will
attempt to obtain more favorable results for the plan. An annual renewal report will be prepared for the
City. Services under this 5ection include workers' compensation stop-loss insurance and third party
administration(TPA) services. �
5. Self-Insured Bene�ts
For all bene�ts self-funded by the City, Gallagher will calculate the appropriate reserve and claims trend
factors to be taken into account from a sound plamiing and policy point of view.
6. COBRA
Gallagher will update the COBRA premiums for core coverage and for total health coverage charged to
former participants and family members who elect to continue the plan's health coverage. (Special
COBRA experience studies and manuals are not within this retainer.) I
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7. Annual Audits and Filin�s with the Government
Gallagher will work closely with the auditor and the plan adnunistrator to provide any required data or �
information we may have readily available to expedite the preparation of any required fmancial report, e.g.
Form 5500 for cafeteria plans and Iowa Chapter 509(A)requirements (if this optional service is selected by
the City),
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8, CommunicRtion with P�rticinants
Gallagher will be available for consultation with the City, legal counsel, or the plan aclministrator to assist in
drafting notices to plan participints about plan or administrative changes. Also, we will review all policies
and amendments drafted by the City's Administrator.
9, Administrative Sunport
Gallagher shall continue to be available for consultation with the plan administrator, as requested, with
regard to routine changes in forms and procedures and general recordkeeping, in terms of efficiency and
cost. Compliance with the recordkeeping requn•ements of laws or regulations are matters subject to die
advice of legal counsel and the City. However, Gallagher shall be available for consultation in this regard
from a non-legal standpouit.
10. Oreznization of Issues
Gallagher will be avlilable for consultation and will assist in preparing meeting agendas to aid khe City in
reaching decisions on issues that arise in the course of plan operation or that flow from our annual repoi�t,
plan design or admuustration questions,national and industry trends,or public policy,
11. Coordination with Other Professional Advisors
Gallagher will, as appropriate, coordinate our efforts with those of legal counsel, the plan administrator and
the auditor regarding policy rnatters of interest to the City and the efficient operation of the plans,
12, Trends in Le�isl�tion,New Benefits,Pl1n Desi�n
By means of our publications and special advisory reports, Gallagher shall continue to keep you apprised of
new developments in the employee benefits field that may bear upon your plamiing and policy decisions.
However, speci�c tecluucal compliance advice in connection with compliance with new legislarion or
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regularions that occur after the effective date of this retainer will generally be treated as a supplementary
service, at an additional fee, based on our regular time charge rates. Of course, questions on the
interpretation and application of laws, regulations, rulings and court decisions are a legal matter, subject to
legal counsel's advise.
13, Meetines
Gallagher will attend up to two meetings with the City as requested per contract year. Of course,between
meetings Gallagher will be continually available for consultarion by phone and in writing to the City, the
plan administrator and the plan's other professional advisor.
Other Sunplementary Services
The preceding list of services describe the matters that regularly arise in the course of the Plan's annual
operations that call for general consulting services. However, it is difficult to predict in advance whether
your Plan will be involved in complicated,time consuming special problems, and, if so,to what extent.
If our assistance uivolves services which are beyond, but incidental to our regular services, then, of course,
Gallagher would render such services within the scope of this retainer. If, on the other hand, the occasion
requires the expenditure of time not anricipated within this retainer, we would proceed only after
consultation with the City. Our compensation for such agreed-upon supplementary services will be based
on our regular time-charge rates.
In addition to those items referred to earlier, some fiu-ther examples follow of supplementaiy consulting and '
actuarial services that may be required by the Plan:
1. Analysis of and compliance with new legislation of new regulations adopted after the effective date
of this retainer,which affects your Plan,
2. Litigation,law suits, or arbitrarion.
3. Competitive bidding for the solicitation of bids from insurance cornpanies to underwrite all or a
portion of the Plan's benefits (including stop-loss, ASO arrangernents, ininimum premiums, or tax shelter
annuity programs)or from other vendors to provide other services to the Plan.
4. Drafting of revised Summ�ry Plan Descriptions or plan documents, subject to legal counsel's and
the City's approval,
5. Redesign of basic adininish�ative and/or recordkeeping methods and computer systems,
6, New procedures, calcularions and deternunarions required due to changes in accounting/auditing
standards, usually through guidelines issued by the Governmental Accounting Standards Board, through
state or federal legislation,
7. Services involving special claims audits.
8, Assisting legal counsel in the preparation of materials in support of special IRS ruling applications,
reviews ar appeals, including conversations or meeting widi IRS staff to the extent requested by legal
counsel and the City.
9, Special shidies on retiree health coverage costs and financing.
10. Assistnnce in the evaluation and selection of alternative delivery systems such as new HMO's
PPO's,EPO's or in the development of such systems.
11, Consultation on the development, implementation and monitoring of Employee Assistance
Programs (EAPs).
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12. Services involving Tax Sheltered Annuity (403(b)) program, deferred compensation (457) and
other retirement programs.
13. Auditing the basic data maintained by the plans for their recordkeeping purposes or made available
to us for calculation purposes.
14. Any services not specifically set forth in this retainer. f
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Account Manaeement
Gallagher will provide notification of any change in senior account management, and understands that the
continuation of this Agreement is contingent upon the satisfactory transition in account management responsibilities,
as determined solely by the City.
B. Obligations of Client
1, Gallagher shall be compensated an amount of$15,750 for the period of October 1,2002—June 30,
2003. For the period July 1, 2003—June 30, 2004,fees will be payable in an amount of$21,000. Billings
will be submitted semi-annually in advance. Travel expenses, inchiding coach airfare,rental car,meals and
accommodations will be reimbursed based on actual costs,
2, In addirion to the fees provided herein, it is understood and agreed that other parties, such as
excess and surplus line brokexs, wholesalers, re-insurance intermediaries, underwriting managers and
similar parties, some of which may be owned in whole or in part by Gallagher's corporate parent,may earn
and retain usual and customary commissions and fees in the course of providing insurance products to
Client pursuant to tlus Agreement, Any such fees or commissions will not constitute compensation to
Gallagher under Section III.B.1 above,
3, Gallagher and certain of its insurance carrier markets from time to time enter into arrangements
providing for additional compensation to be paid to Gallagher by such carrier generally with respect to the
volume of premium or insiu�ance coverages written through Gallagher with such carrier.
4, Client is responsible for payment of premiums for all ins�.u•ance pllced by Gallagher on its behalf.
If any arnount is not paid ui full when due, including premium payments to insurance companies, that
nonpayment shall constitute a material breach of this Agreement that shall allow Gallagher to terminate this
Agreement, at its option, in accordance with Section II.B, .
C. MutualObligations
1. Ownership of Records and Documents
a. Gallagher agrees that all books, records, lists of names, journals, ledgers and other
recorded information developed specifically in connection with the administrarion of
Client shall always be and rerr�zin the property of Client.
Gallagher agrees to keep all such material col�dential and not to reproduce, disclose or
disseminate the material or die information contained therein to third parties without the
prior written consent of Client. Upon termination of flus Agreement for any reason,
Gallagher shall unmediately return all such material, and any copies thereof, to Client,
b. Clieut agrees that Gallagher is the sole ovv�ier of the following material and that Client has
no right to its use following termination of this Agreement:
i. Proprietary computer prob ams;
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ii. Proprietary procedures and methods of administration; and
iii. , Underwriting and client files developed by Gallagher.
Except as required by Iowa Public Records law or other court order, client agrees to
keep all such material confidential and not to reproduce, disclose or disseminate the
material or the information contained therein to flurd parties without the prior written
consent of Gallagher. Upon ternunation of tlus Agreement for any reason, Client shall
unmediately return all such material, and any copies thereof,to Gallagher,
2. Waiver of Nonperformance
No waiver of any default in performance on the part of Gallagher or like waiver by Client, or any
breach or a series of breaches of any of the terms, covenants or conditions of this Agreement shall
constihrte a waiver of any subsequent breach or a waiver of said terms, covenants or conditions,
Resort to any remedies referred to herein shall not be construed as a waiver of any other rights and
remedies to which either party is entitled under tlus Agreement or otherwise.
3. PartialInvalidity
Should any part of this Agreement, for any reason, be declared invalid by a court of competent
j�u-isdiction, the remaining portion shall remain in full force and effect as if this Agreement had
been executed without the invalid portion.
4. Governing Law
The validity, interpretation and perforn�ance of this Agreement shall be controlled and construed
according to the internal laws of the State of Iowa.
5. Successors
This Agreement shall be binding upon and shall inure to the benefit of all assigns, transferees and
successors in the interest of the parties hereto,
6. Entire Agreement; ModiGcation or Amendment
Tliis Agreement and the Exhibit hereto represent the entire and exclusive statemant of the
agreement of the parties and may be modified or amended only by a written statement signed by
both parties, Such modification or amendment shall be attached to, and shall thereupon become a
part of this Agreement.
7. Heldings
Headings herein are for convenience of reference only and shall nat be considered in any
interpretation of this Agreement.
�. Practice of Law
It is understood and agreed that Gallagher will not perform, and Client will not request
performance of, any seivices which may constitute the unauthorized practice of law,
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9. Counterparts
This Agreement may be executed by the parties in several counterparts, each of which shall be
deemed to be an original copy.
10. Remedies Not Exclusive
No remedy confen•ed hereunder is intended to be exclusive of any other remedy and each and
every remedy shall be cumulative and shall be in addition to every other remedy given hereunder
or now or hereafter existing at law or in equity or by statute or otherwise.
11. Subcontracting
Gallagher will not subcontract any or all of the services required to be performed by it hereunder
without prior approval of the City.
12. Insurance
Gallagher shall secure and maintain dt�ring the term of this Agreement insurance coverage as set
forth in the attached Insurance Schedule.
13. Indemnification
Gallagher agrees to defend, indemnify and hold City, its officers, agents and employees harmless
from and against any and all claims of any kind arising out of Gallagher's negligence in the
perforn�ance of this Agreement,
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on the date first written
above.
CLIEN AM �
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Signahu�e Date
City Manager
Title
GALLA + BENEFIT SERVI E ,INC.
BY:
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