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1998-156 O INANCE NO AN ORDINANCE AUTHORIZING THE CITY MANAGER TO EXECUTE A CONTRACT WITH WILLIAM M MERCER, INC TO PROVIDE PROFESSIONAL SERVICES TO ASSIST THE CITY IN EVALUATING AND SELECTING A HEALTH CARE PROVIDER AND TO PROVIDE RELATED SERVICES AS SET FORTH IN THE CONTRACT, PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFOR AND PROVIDING AN EFFECTIVE DATE (PROFESSIONAL SERVICES AGREEMENT # 2217, AWARDED TO WILLIAM M MERCER INC, IN AN AMOUNT NOT TO EXCEED $64,000 00 PER YEAR) WHEREAS, the C~ty needs a professional consultant to provxde professional services, mcludmg, w~thout llmltatton actuarial services, to assist ~t in selecting the most quahfied, lowest responsible b~dder to prowde health insurance to ~ts employees, develop benefits and design strategy, momtor the ongoing admlmstratxon of healthcare plans, and to perform other related functions, and WHEREAS, the C~ty Manager has recommended that the C~ty contract with Wflham M Mercer, Ine to prowde such serwees, and WHEREAS, the Cxty Council deems ~t m the pubhc interest to so contract for such healthcare serwees, NOW THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS ~ That the C~ty Manager ~s authorized to enter ~nto a contract w~th Wllham M Memer, Ine, to prowde profesmonal servmes to evaluate and select the most quahfied, lowest responsible provider for health msurance and to provide related serwces, substantially ~n the form of the Professtonal Services Agreement for Health Care Consultant whmh ~s attached hereto and made a part oftlus ordinance as ffwntten word for word here~n ~ That the C~ty Manager ~s hereby anthonzed to expend the funds as prowded m the attached Professional Servmes Agreement ~ That this ordinance shall become effective lnrmedmtely upon ~ts passage and approval PASSEDAND APPROVED ttus the f~'tL4~ dayof ~.~. ~, ,1998 JACI~ILLER, MAYOR ATTEST JENNIFER WALTERS, CITY SECRETARY APPROVED AS TO LEGAL FORM HERBERT L PROUTY, CITY ATTORNEY ' ' ' ~IC--E PROPOSAL2217 PROF~$SI~ ORDINANCE PROFESSIONAL SERVICES AGREEMENT FOR HEALTH CARE CONSULTANT STATE OF TEXAS § COUNTY OF DENTON § THIS AGREEMENT ts made and entered tnto as of the 18th day of duly ,19 98, by and between the Ctty of Denton, Texas, a Texas munm~pal corporation, w~th its pnnctpal office at 215 East McKtnney Street, Denton, Denton County, Texas 76201, hereinafter called "OWNER" and Wtlham M Mercer, Incorporated, w~th xts corporate office at 2200 Ross Avenue, State 3500, Dallas, TX, 75201, hereinafter called "CONSULTANT," acting herein, by and through their duly authorized representatives WITNESSETH, that in constderatton of the covenants and agreements herein contained, the parties hereto do mutually agree as follows ARTICLE I EMPLOYMENT OF CONSULTANT The OWNER hereby contracts w~th the CONSULTANT, as an mdependent contractor, and the CONSULTANT hereby agrees to perform the servmes heretn m counectxon w~th health msurance consulting servmes as stated m the sectaons to follow, hereinafter sometimes referred to as the ProJect, with dthgence and tn accordance wtth the prevailing professional standards customarily obtmned for such servmes m the State of Texas The profesmonal servmas set out heretn are as follows CONSULTANT shall provide all servmes mutually agreed between the parttes, ~ncludtng but not hmtted to, actuarml servmes to asstst OWNER m evaluatmg and selecting the most quahfied, lowest responsible bidder to prowde health tnsurance to OWNER's employees, developing benefits desxgn strategy, and momtonng the ongoing admm~stratton of health care plans and performance by insurers, as more fully set forth tn Arttcle II heretn ARTICLE II SCOPE OF SERVICES The CONSULTANT shall perform the followtng servmes tn a professxonal manner A All those sermees set forth m CONSULTANT's proposal letter dated March 26, 1998, wluch ts attached hereto and made a part hereof as Exh~btt "A" as if written word for word herem B If there xs any conflict between the terms of this Agreement and the exbabxts attached to tbas Agreement, the terms and cond~txons of th~s Agreement wxll control over the terms and condxtxons of the attached exh~btts or task orders ARTICLE III PERIOD OF SERVICE Th~s AGREEMENT shall become effectxve upon execution of tbas Agreement by the OWNER and the CONSULTANT and upon ~ssue of a notme to proceed by the OWNER, and shall rematn m fome for a period of 36 months Tbas Agreement ~s subject to consideration for renewal upon mutual consent of both part,es for two add~taonal twelve-month periods, wxth negotmtton of the terms, conditions and cost for the successxve years Ttus Agreement may be sooner terminated xn accordance with the prowsxons hereof Txme ~s of the essence m tbas Agreement The CONSULTANT shall make all reasonable efforts to complete the servxces set forth herem as expedxtlously as possthle and to meet the schedule estabhshed by the OWNER, acting through xts Cxty Manager or bas designee, wbach schedule shall be estabhshed after consultatxon w~th the CONSULTANT ARTICLE IV COMPENSATION A COMPENSATION TERMS 1 "Subcontract Expense" as defined as expenses incurred by the CONSULTANT m employment of others xn outside firms for servmes ~n the nature of the subcon~actor or subconsultants work to assxst CONSULTANT 2 "D~rect Non-Labor Expense" ~s defined as that expense for any assxgnment recurred by the CONSULTANT for supphes, transportatxon and eqmpment, travel, commumcat~ons, subsxstence, and lodging away from home, and s~mflar ~nc~dental expenses ~n connection w~th that assignment B BILLING AND PAYMENT For and ~n consideration of the professional services to be performed by the CONSULTANT hare~n, the OWNER agrees to pay a set monthly fee of $5 00 per active participating employee per month for the first twelve months of tbas Agreement The monthly fee per employee wall be $5 25 and $5 50 for the second and tl~rd years of th~s Agreement, respectively Consulting fees wall be subject to a monthly m~mmum of $4,000 and a monthly max~mmn not to exceed $5,000, m add~taon to any d~rect non-labor expense The total annual fee for each year ofttus Agreement, mcludmg reimbursement for D~rect Non-Labor Expense, shall not exceed $64,000 Nothing contmned in th~s Artacle shall reqmre the OWNER to pay for any work wbach ~s unsatisfactory, as reasonably determined by the City Manager or h~s designee, or 2 which is not submitted in compliance with the terms of this Agreement The OWNER shall not be required to make any payments to the CONSULTANT while the CONSULTANT is in default under this Agreement with respect to the work to winch the default applies It is specifically understood and agreed that the CONSULTANT shall not be authorized to undertake any work pursuant to this Agreement which would require additional payments by the OWNER for any charge, expense, or reimbursement above the maximum not to exceed fee as stated, unless CONSULTANT is requested to perform tasks outside the scope presented in this contract If additional assistance is required from the CONSULTANT, estimates of professional fees will be provided and presented to OWNER for approval before proceeding with any additional tasks The CONSULTANT shall not be pad additional payments by the OWNER for any charge, expense, fee or reimbursement above the maximum not to exceed figure nor perform any additional sermces, without obtmmng prior written authorization from the OWNER CONSULTANT and OWNER expressly understand and agree that CONSULTANT shall not receive any compensation for the services provided for herein, from any other source C ADDITIONAL SERVICE For additional services authorized in writing by the OWNER in Article III, the CONSULTANT shall be prod based on a professional fee proposal provided by the CONSULTANT at the time additional services are requested by the OWNER Payments for additional services shall be due and payable upon submission by the CONSULTANT, and shall be in accordance w~th subsection B hereof Statements shall not be submitted more frequently than monthly D PAYMENT If the OWNER fails to make payments due the CONSULTANT for services and expenses within sixty (60) days after receipt of the CONSULTANT's undisputed statement thereof, the amounts due the CONSULTANT will be increased by the rate of one percent (1%) per month from the smd sixtieth (60th) day, and, in addition, the CONSULTANT may, after giving seven (7) days' written notice to the OWNER, suspend services under this Agreement until the CONSULTANT has been pud in full all amounts due for services, expenses, and charges, provided, however, nothing herein shall require the OWNER to pay the late charge of one pement (1%) set forth herein w~th respect to certmn work if the OWNER reasonably determines that such work is unsatisfactory, in accordance with this Article IV, "Compensation" ARTICLE V OBSERVATION AND REVIEW OF THE WORK The CONSULTANT will exercise reasonable care and due diligence in discovering and promptly reporting to the OWNER any defects or deficiencies in the work of the CONSULTANT or any subcontractor or subconsultants ARTICLE VI OWNERSHIP OF DOCUMENTS All documents prepared or furmshed by the CONSULTANT (and CONSULTANT's subcontractors or subeonsultants) specifically and exclusively for OWNER pursuant to this Agreement are instruments of service, and shall become the property of the OWNER upon the termination ofth~s Agreement The CONSULTANT is entitled to retmn copies of all such documents The documents prepared and furmshed by the CONSULTANT are intended only to be applicable to this ProJect, and OWNER's use of these documents in other projects shall be at OWNER's sole risk and expense In the event the OWNER uses any of the information or materials developed pursuant to tbas Agreement in another project or for other purposes than specified herein, CONSULTANT is released from any and all liability relating to their use in that project, but the OWNER shall have the right and authority to use these documents, materials, and data for any purpose Notwithstanding anything to the contrary contmned in tbas Agreement, it is understood and agreed that the CONSULTANT shall retain all of its rights in its methodologies and methods of analysis, ideas, concepts, expressions, know how, methods, teehmques, skills, knowledge and experience possessed by the CONSULTANT prior to, or acquired by the CONSULTANT during, the performance of tbas Agreement and the CONSULTANT shall not be restricted in any way with respect thereto ARTICLE VII INDEPENDENT CONTRACTOR CONSULTANT shall provide services to OWNER as an independent contractor, not as an employee of the OWNER CONSULTANT shall not have or claim any right arising from employee status ARTICLE VIII INDEMNITY AGREEMENT The CONSULTANT shall indemnify and save and hold harmless the OWNER and xts officers, and employees from and agmnst any and all liability, claims, demands, damages, losses, and expenses, including, but not limited to court costs and reasonable attorney fees incurred by the OWNER, and including, w~thout limitation, damages for bodily and personal injury, death and property damage, resulting directly from the negligent acts or wrongful omissions of the CONSULTANT or its officers, shareholders, 4 authorized agents, or employees in the execution, operation, or performance of flus Agreement Noflung in ttus Agreement shall be construed to create a liability to any person who Is not a party to this Agreement, and nothing herein shall waive any of the parties' defenses, both at law or equity, to any claim, cause of action, or litigation filed by anyone not a party to this Agreement, including the defense of governmental immunity, which defenses are hereby expressly reserved ARTICLE IX INSURANCE Dunng the performance of the services under this Agreement, CONSULTANT shall mmntaln the following insurance (other than Professional Liability Insurance) with insurance compames heensed to do business m the State of Texas by the State Insurance Commission or any successor agency that has a rating with Best Rate Carriers of at least an A- or above A Comprehensive General Liability Insurance w~th bodily m. lury limits of not less than $500,000 for each occurrence and not less than $500,000 in the aggregate, and with property damage limits of not less than $100,000 for each occurrence and not less than $100,000 In the aggregate B Automobile Liability Insurance with bodily injury limits of not less than $500,000 for each person and not less than $500,000 for each accident, and w~th property damage limits of not less than $100,000 for each accident C Workers' Compensation Insurance in accordance with statutory requirements, and Employers' Liability Insurance with limits of not less than $I00,000 for each accident D Professional Liability Insurance with limits of not less than $1,000,000 annual aggregate E The CONSULTANT shall furnish insurance certificates or insurance policies at the OWNER's request to evidence such coverages The insurance policies shall contain a provision that such insurance shall not be canceled or materially modified w~thout thirty (30) days' prior written notice to CONSULTANT In such event, CONSULTANT shall provide immediate written notice to OWNER and shall, prior to the effective date of the change or cancellation, serve substitute policies furnishing the same coverage 5 ARTICLE X ARBITRATION AND ALTERNATE DISPUTE RESOLUTION The part~es may agree to settle any d~sputes under th~s Agreement by subm~tttng the dispute to arbitration or other means of alternate d~spute resolution, such as mediation No arbitration or alternate d~spute resolution arising out of or relating to th~s Agreement, revolving one party's d~sagreement, may ~nclude the other party to the d~sagreement xanthout the other's approval ARTICLE XI TERMINATION OF AGREEMENT A Notwithstanding any other prows~on of th~s Agreement, e~ther party may terminate this Agreement by g~wng thirty (30) days' advance written not,ce to the other party B Th~s Agreement may be tenmnated ~n whole or ~n part m the event of either party substantially fmlmg to fulfill ~ts obhgat~on under th~s Agreement No such termination will be effected unless the other party ~s g~ven (1) written notme (dehvered by certffied marl, return receipt requested) of intent to terminate and settmg forth the reasons specifying the non-performance, and not less than tlurty (30) calendar days to cure the fmlure, and (2) an opportumty for consultation vnth the terminating party prior to termmatton C If the Agreement ~s terminated prior to completion of the services to be prowded hereunder, CONSULTANT shall ~mmed~ately cease all services and shall render a final bill for services to the OWNER w~thtn tlurty (30) days after the date of temunat~on The OWNER shall pay CONSULTANT for all servmes properly rendered and satisfactorily performed and for reimbursable expenses to termination recurred prior to the date of termination Should the OWNER subsequently contract with a new consultant for the continuation of serwces on the ProJect, CONSULTANT shall reasonably cooperate m prowdmg mformat~on The CONSULTANT shall mm over all documents prepared or furnished by CONSULTANT specffically and exclusively for the OWNER pursuant to tlus Agreement to the OWNER on or before the date of termination, but may mmntmn cop~es of such documents for ~ts use ARTICLE XII RESPONSIBILITY FOR CLAIMS AND LIABILITIES Approval by the OWNER shall not constitute, nor be deemed a release of the responsibility and habthty of the CONSULTANT, ~ts employees, assomates, authorized agents, subcontractors, and subconsultants for the accuracy and competency of their designs or other work, nor shall such approval be deemed to be an assumption of such responsibility by the OWNER for any defect ~n the design or other work prepared by the CONSULTANT, ~ts employees, subcontractors, authorized agents, and subconsultants 6 ARTICLE XIII NOTICES All notices, communications, and reports required or permitted under tins Agreement shall be personally delivered or marled to the respective parties by deposlung same m the United States mai to the address shown below, certified mai, return receipt requested, unless otherwise specified herein To CONSULTANT To OWNER William M Mercer, Incorporated City of Denton 2200 Ross Avenue Ted Benavides, City Manager State 3500 215 East McKlnney Dallas, TX 75201 Denton, TX 76201 All notices shall be deemed effective upon receipt by the party to whom such notice is given, or within three (3) days' marling, whichever is earlier ARTICLE XIV ENTIRE AGREEMENT Tins Agreement, consisting of ten pages and one extublt, constitutes the complete and final expression of the agreement of the parties, and as intended as a complete and exclusive statement of the terms of their agreements, and supersedes all prior contemporaneous offers, promises, representations, negotiations, discussions, communications, and agreements which may have been made in connection w~th the subject matter hereof ARTICLE XV SEVERABILITY If any prowslon of this Agreement is found or deemed by a court of competent jurisdiction to be invalid or unenforceable, it shall be considered severable from the remainder of this Agreement and shall not cause the remainder to be invalid or unenforceable In such event, the parties shall reform this Agreement to replace such stricken provision wtth a valid and enforceable provision which comes as close as possible to expressing the intention of the stricken provision ARTICLE XVI COMPLIANCE WITH LAWS The CONSULTANT shall comply wath all federal, state, and local laws, rules, regulations, and ordinances appheable to the work covered hereunder as they may now read or hereinafter be amended ARTICLE XVII DISCRIMINATION PROHIBITED In perform:ng the services required hereunder, the CONSULTANT shall not dlscrlmmate agmnst any person on the basis of race, color, religion, sex, national origin or ancestry, age, or physical handicap ARTICLE XVIII PERSONNEL A The CONSULTANT represents that it has or will secure, at its own expense, all personnel reqmred to perform all the services required under this Agreement Such personnel shall not be employees or officers of, or have any contractual relations with the OWNER CONSULTANT shall inform the OWNER of any conflict of interest or potential conflict of interest that may arise during the term of this Agreement B All services reqmred hereunder wall be performed by the CONSULTANT or under its supervision All personnel engaged in work shall be qualified, and shall be authorized and permitted under state and local laws to perform such services ARTICLE XIX ASSIGNABILITY Neither party shall assign any interest in this Agreement, nor transfer any interest in this Agreement (whether by assignment, novation, or otherwase) wathout the prior written consent of the other party ARTICLE XX MODIFICATION No waiver or modification of ttus Agreement or of any covenant, condition, or limitation hereto contained shall be valid unless in writing and duly executed by the party to be charged therewath, and no evidence of any waiver or modification shall be offered or received m evidence in any proceeding arising between the parties hereto out of or affecting th~s Agreement, or the rxghts or obligations of the part~es hereunder, and unless such waiver or modification is in writing and duly executed, and the parties further agree that the provisions of this section wall not be wmved unless as set forth herein ARTICLE XXI MISCELLANEOUS A The followang exinbtts are attached to and made a part of ttus Agreement Exhibit A - Proposal letter from CONSULTANT to OWNER dated March 26, 1998 8 B CONSULTANT agrees that OWNER shall, until the exparat~on of three (3) years after tile final payment under thas Agreement, have access to and the right to examine any darectly pertinent books, documents, papers, and records of the CONSULTANT anvolvmg transactaons relating to thas Agreement CONSULTANT agrees that OWNER shall have access dunng normal working hours to all necessary CONSULTANT facthtaes and shall be provided adequate and appropriate workang space m order to conduct audats m comphance wath thas sectaon OWNER shall gave CONSULTANT reasonable advance notme of antended audats C Venue of any stat or cause of actaon under thas Agreement shall he exclusavely m Denton County, Texas Tins Agreement shall be construed in accordance wath the laws of the State of Texas D For the purpose of thas Agreement, the key persons who wall perform most of the work hereunder shall be Mark Chromster, J~m Falconer, and Brenda Pagel However, n0thmg hereto shall hmat CONSULTANT from usang other qualffied and competent members of ats firm to perform the services reqmred herean E CONSULTANT shall commence, carry on, and complete any and all projects with all apphcable d~spatch, m a sound, economacal, and efficaem manner and an accordance with the provasaons hereof In accomphshtng the projects, CONSULTANT shall take such steps as are appropriate to ensure that the work ~nvolved as properly coordanated w~th related work being earned on by the OWNER F The OWNER shall assast the CONSULTANT by plamng at the CONSULTANT's disposal all avmlable mformataon pemnant to the Project, ~ncludang prevaous reports, any other data relative to the ProJect, and arranging for the access thereto, and make all prows~ons for the CONSULTANT to enter m or upon pubhc and private property as reqmred for the CONSULTANT to perform servmes under th~s Agreement G The eaptaons of thas Agreement are for ~nformat~onal purposes only, and shall not ~n any way affect the substantive terms or condataons of thas Agreement IN WITNESS HEREOF, the Caty of Denton, Texas has caused th~s Agreement to be e>~ecuted by ats duly authonzed Caty Manager, and CONSULTANT has executed thas Agreement through ~ts duly authorized undersigned officer on tins the ~gph~ y day of July- ,1998 ~-- CITY OF DENTON, TEXAS TED BENAVIDES, CITY MANAGER 9 ATTEST JENNIFER WALTERS, CITY SECRETARY AS TO LEGAL FORM HERBERT L PROUTY, CITY ATTORNEY BY / / WILLIAM M MERCER, INCORPORATED WI~ESS STATE OF TEXAS COUNTY OF DALLAS Thls instrument ~as acknowledged before BY me on qay 11, 1998, by Mark Chronlster, AssocIate, of W~ll~am ~1 Mercer, a Delaware Corporation, on behalf of sa~d corporatIon. James W. Falconer Notary Public ~ Commission Expires 12-12-2001 10