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HomeMy WebLinkAboutItem 12g - Third Party General Liability Claims Administration Services DATE: September 21, 2021 TO: Honorable Mayor and City Council FROM: Hue C. Quach, Administrative Services Director Shama P. Curian, Human Resources Administrator By: Diana Sanapanya, Management Aide SUBJECT: AGREEMENT WITH GEORGE HILLS COMPANY, INC. FOR THIRD PARTY GENERAL LIABILITY CLAIMS ADMINISTRATION SERVICES IN AN AMOUNT NOT TO EXCEED $185,820 Recommendation: Approve SUMMARY On June 20, 2018, the City Council approved a three-year Agreement with Carl Warren for third party general liability claims administration services. The current contract was extended 3 months, to September 30, 2021, to provide the City the opportunity to join the City’s risk pool, CIPA, in their contract with Third Party Administration Services (“TPA”). Based on the expertise and services provided through this arrangement, it is recommended that the City Council authorize the City Manager to execute a five-year Agreement with George Hills Company, Inc. in the total amount of $185,820 from October 1, 2021, through September 30, 2026. The proposed Agreement provides an annual 3% escalator effective on October 1 of each year of the Agreement. BACKGROUND The City of Arcadia is a member of CIPA, which operates within the guidelines of a Joint Powers Authority to self-fund the general liability insurance program. The program requires the services of a Third-Party Administrator (“TPA”) to handle the daily operations of the City’s general liability claims. Carl Warren has provided TPA services for the City’s general liability program since 2012. However, staff has not been pleased with Carl Warren’s level of service in recent years. Rather than extending the contract with Carl Warren or beginning a Request for Proposals (“RFP”) process, it was determined that utilizing CIPA to issue the RFP for the general liability program would allow for a competitive bid process for cost control of fee structures. Agreement with George Hills Company, Inc. for General Liability Claims Administration Services September 21, 2021 Page 2 of 3 In 2016, CIPA had conducted an extensive Request for Proposal process to evaluate general liability claims administrators. As a result of that RFP, George Hills Inc. was recommended as the preferred provider. In August 2021, the 11 member agencies in CIPA who currently utilize the services of George Hills unanimously voted to extend the current contract an additional 5 years rather than opening an RFP. George Hills informed CIPA that they would honor the quote provided in 2016 for general liability claim administration services for the City of Arcadia. DISCUSSION While Carl Warren has provided savings over the course of the three-year service agreement and stated they would honor the current annual fee of $21,000, the City has not been happy with the overall quality of service provided recently. The third-party adjustors from Carl Warren have been inconsistent and sometimes non-responsive on status of claims or next steps to move a claim to closure. Many of the processes that would usually be conducted by Carl Warren, have been undertaken by City staff to facilitate movement of claims. While this has eased the costs from Carl Warren, indirect costs arise as the City has picked up this work to ensure accurate and consistent handling of each claim. The services provided by George Hills Company Inc. will include all aspects of claims administration in compliance with the applicable General Liability Laws for the State of California. These services include but are not limited to: Managing claims, monitoring defense counsel, attending mediations, mandatory and voluntary settlement conferences, arbitrations, trials, small claims and other proceedings, attending meetings as requested, communicating with CIPA, City of Arcadia staff, defense counsel and all other parties as required, conducting training as requested, advising of any material information impacting claims or need for improvements in any matter related to the Agreement between the parties, including advice relating to changes and proposed changes in statutes, regulations and rules affecting liability claims, performing general administrative functions and management oversight, and notifying the CIPA General Manager and Litigation Manager of any claims with potential exposure to CIPA. The proposed Agreement will run through September 30, 2026, when it can either be renewed, renegotiated, or re-bid. George Hills Company, Inc. has been in business for over 60 years, and they have received above average performance rating based on annual audits conducted by CIPA. With their familiarity of the City’s risk pool, their depth of expertise, and their ability to provide prompt service, it is recommended that the City Council authorize the City Manager to approve the Agreement with George Hills Company, Inc. for five years from October 1, 2021, through September 30, 2026. A copy of the proposed Agreement is attached. Agreement with George Hills Company, Inc. for General Liability Claims Administration Services September 21, 2021 Page 3 of 3 ENVIRONMENTAL ANALYSIS The proposed action does not constitute a project under the California Environmental Quality Act (“CEQA”) under Section 15061(b)(3) of the CEQA Guidelines, and it can be seen with certainty that it will have no impact on the environment. Thus, this matter is exempt under CEQA. FISCAL IMPACT The total cost of the 5-year Agreement with George Hills Company, Inc. is $185,820. The proposed Agreement provides a 3% escalator on the anniversary of the Agreement, effective October 1 of each year. Under the terms of the proposed Agreement, the annual fees will be as follows: • FY 2021-22 $35,000 • FY 2022-23 $36,050 • FY 2023-24 $37,132 • FY 2024-25 $38,245 • FY 2025-26 $39,393 Appropriate funding has been budgeted in the FY 2021-22 Operating Budget for the proposed Agreement with George Hills Company, Inc. RECOMMENDATION It is recommended that the City Council determine that this project is exempt under the California Environmental Quality Act (“CEQA”); and approve, authorize, and direct the City Manager to execute, a five-year Agreement with George Hills Company, Inc. for Third Party General Liability Claims Administration Services in the amount of $185,820. Attachment: Proposed Amended Agreement for General Liability Claims Administration Services 1 Updated Feb. 2020 CITY OF ARCADIA PROFESSIONAL SERVICES AGREEMENT REGARDING GENERAL LIABILITY CLAIMS ADMINISTRATION SERVICES This Agreement is made and entered into as of October 1, 2021 by and between the California Insurance Pool Authority with its principal place of business at 366 San Miguel Drive, Suite 312, Newport Beach, CA 92660 (hereinafter referred to as “CIPA”), the City of Arcadia, a municipal corporation organized and operating under the laws of the State of California with its principal place of business at 240 West Huntington Drive, Arcadia, California 91066 (“City”), and George Hills Company, Inc., a Limited Liability Company with its principal place of business at P.O. BOX 278, Rancho Cordova, CA 95741 (hereinafter referred to as “Consultant”). City and Consultant are sometimes individually referred to as “Party” and collectively as “Parties” in this Agreement. RECITALS A. City is a public agency of the State of California and is in need of professional services for the following project: General Liability Claims Administration Services (hereinafter referred to as “the Project”). B. Consultant is duly licensed and has the necessary qualifications to provide such services. C. The Parties desire by this Agreement to establish the terms for City to retain Consultant to provide the services described herein. AGREEMENT NOW, THEREFORE, IT IS AGREED AS FOLLOWS: 1. Services. Consultant shall provide the City with the services described in the Scope of Services attached hereto as Exhibit “A.” 2. Compensation. a. Subject to paragraph 2(b) below, the City shall pay for such services in accordance with the below: Flat Monthly Fee The flat fee shall be as follows: • FY 2021-22 $35,000 • FY 2022-23 $36,050 • FY 2023-24 $37,132 • FY 2024-25 $38,245 • FY 2025-26 $39,393 2 Updated Feb. 2020 b. In no event shall the total amount paid for services rendered by Consultant under this Agreement exceed the sum of $185,820. This amount is to cover all printing and related costs, and the City will not pay any additional fees for printing expenses. Periodic payments shall be made within 30 days of receipt of an invoice which includes a detailed description of the work performed. Payments to Consultant for work performed will be made on a monthly billing basis. 3. Additional Work. If changes in the work seem merited by Consultant or the City, and informal consultations with the other party indicate that a change is warranted, it shall be processed in the following manner: a letter outlining the changes shall be forwarded to the City by Consultant with a statement of estimated changes in fee or time schedule. An amendment to this Agreement shall be prepared by the City and executed by both Parties before performance of such services, or the City will not be required to pay for the changes in the scope of work. Such amendment shall not render ineffective or invalidate unaffected portions of this Agreement. 4. Maintenance of Records. Books, documents, papers, accounting records, and other evidence pertaining to costs incurred shall be maintained by Consultant and made available at all reasonable times during the contract period and for four (4) years from the date of final payment under the contract for inspection by City. 5. Term. The term of this Agreement shall be from 10/01/2021 to 09/30/2026, unless earlier terminated as provided herein. The Parties may, by mutual, written consent, extend the term of this Agreement if necessary to complete the Project. Consultant shall perform its services in a prompt and timely manner within the term of this Agreement and shall commence performance upon receipt of written notice from the City to proceed (“Notice to Proceed”). The Notice to Proceed shall set forth the date of commencement of work. 6. Delays in Performance. a. Neither City nor Consultant shall be considered in default of this Agreement for delays in performance caused by circumstances beyond the reasonable control of the non- performing party. For purposes of this Agreement, such circumstances include but are not limited to, abnormal weather conditions; floods; earthquakes; fire; epidemics; war; riots and other civil disturbances; strikes, lockouts, work slowdowns, and other labor disturbances; sabotage or judicial restraint. b. Should such circumstances occur, the non-performing party shall, within a reasonable time of being prevented from performing, give written notice to the other party describing the circumstances preventing continued performance and the efforts being made to resume performance of this Agreement. 7. Compliance with Law. 3 Updated Feb. 2020 a. Consultant shall comply with all applicable laws, ordinances, codes and regulations of the federal, state and local government, including Cal/OSHA requirements. b. If required, Consultant shall assist the City, as requested, in obtaining and maintaining all permits required of Consultant by federal, state and local regulatory agencies. c. If applicable, Consultant is responsible for all costs of clean up and/ or removal of hazardous and toxic substances spilled as a result of his or her services or operations performed under this Agreement. 8. Standard of Care Consultant’s services will be performed in accordance with generally accepted professional practices and principles and in a manner consistent with the level of care and skill ordinarily exercised by members of the profession currently practicing under similar conditions. 9. Assignment and Subconsultant Consultant shall not assign, sublet, or transfer this Agreement or any rights under or interest in this Agreement without the written consent of the City, which may be withheld for any reason. Any attempt to so assign or so transfer without such consent shall be void and without legal effect and shall constitute grounds for termination. Subcontracts, if any, shall contain a provision making them subject to all provisions stipulated in this Agreement. Nothing contained herein shall prevent Consultant from employing independent associates, and subconsultants as Consultant may deem appropriate to assist in the performance of services hereunder. 10. Independent Contractor Consultant is retained as an independent contractor and is not an employee of City. No employee or agent of Consultant shall become an employee of City. The work to be performed shall be in accordance with the work described in this Agreement, subject to such directions and amendments from City as herein provided. 11. Insurance. Consultant shall not commence work for the City until it has provided evidence satisfactory to the City it has secured all insurance required under this section. In addition, Consultant shall not allow any subcontractor to commence work on any subcontract until it has secured all insurance required under this section. a. Commercial General Liability (i) The Consultant shall take out and maintain, during the performance of all work under this Agreement, in amounts not less than specified herein, Commercial General Liability Insurance, in a form and with insurance companies acceptable to the City. (ii) Coverage for Commercial General Liability insurance shall be at least as broad as the following: (1) Insurance Services Office Commercial General Liability coverage (Occurrence Form CG 00 01) or exact equivalent. 4 Updated Feb. 2020 (iii) Commercial General Liability Insurance must include coverage for the following: (1) Bodily Injury and Property Damage (2) Personal Injury/Advertising Injury (3) Premises/Operations Liability (4) Products/Completed Operations Liability (5) Aggregate Limits that Apply per Project (6) Explosion, Collapse and Underground (UCX) exclusion deleted (7) Contractual Liability with respect to this Agreement (8) Property Damage (9) Independent Consultants Coverage (iv) The policy shall contain no endorsements or provisions limiting coverage for (1) contractual liability; (2) cross liability exclusion for claims or suits by one insured against another; (3) products/completed operations liability; or (4) contain any other exclusion contrary to the Agreement. (v) The policy shall give City, its officials, officers, employees, agents and City designated volunteers additional insured status using ISO endorsement forms CG 20 10 10 01 and 20 37 10 01, or endorsements providing the exact same coverage. (vi) The general liability program may utilize either deductibles or provide coverage excess of a self-insured retention, subject to written approval by the City, and provided that such deductibles shall not apply to the City as an additional insured. b. Automobile Liability (i) At all times during the performance of the work under this Agreement, the Consultant shall maintain Automobile Liability Insurance for bodily injury and property damage including coverage for owned, non-owned and hired vehicles, in a form and with insurance companies acceptable to the City. (ii) Coverage for automobile liability insurance shall be at least as broad as Insurance Services Office Form Number CA 00 01 covering automobile liability (Coverage Symbol 1, any auto). (iii) The policy shall give City, its officials, officers, employees, agents and City designated volunteers additional insured status. (iv) Subject to written approval by the City, the automobile liability program may utilize deductibles, provided that such deductibles shall not apply to the City as an additional insured, but not a self-insured retention. c. Workers’ Compensation/Employer’s Liability (i) Consultant certifies that he/she is aware of the provisions of Section 3700 of the California Labor Code which requires every employer to be insured against liability for workers’ compensation or to undertake self-insurance in accordance with the provisions of that code, and he/she will comply with such provisions before commencing work under this Agreement. 5 Updated Feb. 2020 (ii) To the extent Consultant has employees at any time during the term of this Agreement, at all times during the performance of the work under this Agreement, the Consultant shall maintain full compensation insurance for all persons employed directly by him/her to carry out the work contemplated under this Agreement, all in accordance with the “Workers’ Compensation and Insurance Act,” Division IV of the Labor Code of the State of California and any acts amendatory thereof, and Employer’s Liability Coverage in amounts indicated herein. Consultant shall require all subconsultants to obtain and maintain, for the period required by this Agreement, workers’ compensation coverage of the same type and limits as specified in this section. d. Professional Liability (Errors and Omissions) At all times during the performance of the work under this Agreement the Consultant shall maintain professional liability or Errors and Omissions insurance appropriate to its profession, in a form and with insurance companies acceptable to the City and in an amount indicated herein. This insurance shall be endorsed to include contractual liability applicable to this Agreement and shall be written on a policy form coverage specifically designed to protect against acts, errors or omissions of the Consultant. “Covered Professional Services” as designated in the policy must specifically include work performed under this Agreement. The policy must “pay on behalf of” the insured and must include a provision establishing the insurer's duty to defend. e. Minimum Policy Limits Required (i) The following insurance limits are required for the Agreement: Combined Single Limit Commercial General Liability $1,000,000 per occurrence/ $2,000,000 aggregate for bodily injury, personal injury, and property damage Automobile Liability $1,000,000 per occurrence for bodily injury and property damage Employer’s Liability $1,000,000 per occurrence Professional Liability $1,000,000 per claim and aggregate (errors and omissions) (ii) Defense costs shall be payable in addition to the limits. (iii) Requirements of specific coverage or limits contained in this section are not intended as a limitation on coverage, limits, or other requirement, or a waiver of any coverage normally provided by any insurance. Any available coverage shall be provided to the parties required to be named as Additional Insured pursuant to this Agreement. f. Evidence Required Prior to execution of the Agreement, the Consultant shall file with the City evidence of insurance from an insurer or insurers certifying to the coverage of all insurance required herein. Such evidence shall include original copies of the ISO CG 00 01 (or insurer’s equivalent) 6 Updated Feb. 2020 signed by the insurer’s representative and Certificate of Insurance (Acord Form 25-S or equivalent), together with required endorsements. All evidence of insurance shall be signed by a properly authorized officer, agent, or qualified representative of the insurer and shall certify the names of the insured, any additional insureds, where appropriate, the type and amount of the insurance, the location and operations to which the insurance applies, and the expiration date of such insurance. g. Policy Provisions Required (i) Consultant shall provide the City at least thirty (30) days prior written notice of cancellation of any policy required by this Agreement, except that the Consultant shall provide at least ten (10) days prior written notice of cancellation of any such policy due to non-payment of premium. If any of the required coverage is cancelled or expires during the term of this Agreement, the Consultant shall deliver renewal certificate(s) including the General Liability Additional Insured Endorsement to the City at least ten (10) days prior to the effective date of cancellation or expiration. (ii) The Commercial General Liability Policy and Automobile Policy shall each contain a provision stating that Consultant’s policy is primary insurance and that any insurance, self-insurance or other coverage maintained by the City or any named insureds shall not be called upon to contribute to any loss. (iii) The retroactive date (if any) of each policy is to be no later than the effective date of this Agreement. Consultant shall maintain such coverage continuously for a period of at least three years after the completion of the work under this Agreement. Consultant shall purchase a one (1) year extended reporting period A) if the retroactive date is advanced past the effective date of this Agreement; B) if the policy is cancelled or not renewed; or C) if the policy is replaced by another claims-made policy with a retroactive date subsequent to the effective date of this Agreement. (iv) All required insurance coverages, except for the professional liability coverage, shall contain or be endorsed to waiver of subrogation in favor of the City, its officials, officers, employees, agents, and volunteers or shall specifically allow Consultant or others providing insurance evidence in compliance with these specifications to waive their right of recovery prior to a loss. Consultant hereby waives its own right of recovery against City, and shall require similar written express waivers and insurance clauses from each of its subconsultants. (v) The limits set forth herein shall apply separately to each insured against whom claims are made or suits are brought, except with respect to the limits of liability. Further the limits set forth herein shall not be construed to relieve the Consultant from liability in excess of such coverage, nor shall it limit the Consultant’s indemnification obligations to the City and shall not preclude the City from taking such other actions available to the City under other provisions of the Agreement or law. h. Qualifying Insurers (i) All policies required shall be issued by acceptable insurance companies, as determined by the City, which satisfy the following minimum requirements: (1) Each such policy shall be from a company or companies with a current A.M. Best's rating of no less than A:VII and admitted to transact in the 7 Updated Feb. 2020 business of insurance in the State of California, or otherwise allowed to place insurance through surplus line brokers under applicable provisions of the California Insurance Code or any federal law. i. Additional Insurance Provisions (i) The foregoing requirements as to the types and limits of insurance coverage to be maintained by Consultant, and any approval of said insurance by the City, is not intended to and shall not in any manner limit or qualify the liabilities and obligations otherwise assumed by the Consultant pursuant to this Agreement, including but not limited to, the provisions concerning indemnification. (ii) If at any time during the life of the Agreement, any policy of insurance required under this Agreement does not comply with these specifications or is canceled and not replaced, City has the right but not the duty to obtain the insurance it deems necessary and any premium paid by City will be promptly reimbursed by Consultant or City will withhold amounts sufficient to pay premium from Consultant payments. In the alternative, City may cancel this Agreement. (iii) The City may require the Consultant to provide complete copies of all insurance policies in effect for the duration of the Project. (iv) Neither the City nor any of its officials, officers, employees, agents or volunteers shall be personally responsible for any liability arising under or by virtue of this Agreement. j. Subconsultant Insurance Requirements. Consultant shall not allow any subcontractors or subconsultants to commence work on any subcontract until they have provided evidence satisfactory to the City that they have secured all insurance required under this section. Policies of commercial general liability insurance provided by such subcontractors or subconsultants shall be endorsed to name the City as an additional insured using ISO form CG 20 38 04 13 or an endorsement providing the exact same coverage. If requested by Consultant, City may approve different scopes or minimum limits of insurance for particular subcontractors or subconsultants. 12. Indemnification. a. To the fullest extent permitted by law, Consultant shall defend (with counsel of City’s choosing), indemnify and hold the City, its officials, officers, employees, volunteers, and agents free and harmless from any and all claims, demands, causes of action, costs, expenses, liability, loss, damage or injury of any kind, in law or equity, to property or persons, including wrongful death, in any manner arising out of, pertaining to, or incident to any acts, errors or omissions, or willful misconduct of Consultant, its officials, officers, employees, subcontractors, consultants or agents in connection with the performance of the Consultant’s services, the Project or this Agreement, including without limitation the payment of all damages, expert witness fees and attorney’s fees and other related costs and expenses. Consultant's obligation to indemnify shall not be restricted to insurance proceeds, if any, received by Consultant, the City, its officials, officers, employees, agents, or volunteers. b. To the extent required by Civil Code section 2782.8, which is fully incorporated herein, Consultant’s obligations under the above indemnity shall be limited to claims 8 Updated Feb. 2020 that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the Consultant, but shall not otherwise be reduced. If Consultant’s obligations to defend, indemnify, and/or hold harmless arise out of Consultant’s performance of “design professional services” (as that term is defined under Civil Code section 2782.8), then upon Consultant obtaining a final adjudication that liability under a claim is caused by the comparative active negligence or willful misconduct of the City, Consultant’s obligations shall be reduced in proportion to the established comparative liability of the City and shall not exceed the Consultant’s proportionate percentage of fault. 13. California Labor Code Requirements. a. Consultant is aware of the requirements of California Labor Code Sections 1720 et seq. and 1770 et seq., which require the payment of prevailing wage rates and the performance of other requirements on certain “public works” and “maintenance” projects (“Prevailing Wage Laws”). If the services are being performed as part of an applicable “public works” or “maintenance” project, as defined by the Prevailing Wage Laws, and if the total compensation is $15,000 or more for maintenance or $25,000 or more for construction, alteration, demolition, installation, or repair, Consultant agrees to fully comply with such Prevailing Wage Laws. Consultant shall defend, indemnify and hold the City, its officials, officers, employees and agents free and harmless from any claims, liabilities, costs, penalties or interest arising out of any failure or alleged failure to comply with the Prevailing Wage Laws. It shall be mandatory upon the Consultant and all subconsultants to comply with all California Labor Code provisions, which include but are not limited to prevailing wages (Labor Code Sections 1771, 1774 and 1775), employment of apprentices (Labor Code Section 1777.5), certified payroll records (Labor Code Sections 1771.4 and 1776), hours of labor (Labor Code Sections 1813 and 1815) and debarment of contractors and subcontractors (Labor Code Section 1777.1). b. If the services are being performed as part of an applicable “public works” or “maintenance” project and if the total compensation is $15,000 or more for maintenance or $25,000 or more for construction, alteration, demolition, installation, or repair, then pursuant to Labor Code Sections 1725.5 and 1771.1, the Consultant and all subconsultants performing such services must be registered with the Department of Industrial Relations. Consultant shall maintain registration for the duration of the Project and require the same of any subconsultants, as applicable. This Project may also be subject to compliance monitoring and enforcement by the Department of Industrial Relations. It shall be Consultant’s sole responsibility to comply with all applicable registration and labor compliance requirements. c. This Agreement may also be subject to compliance monitoring and enforcement by the Department of Industrial Relations. It shall be Consultant’s sole responsibility to comply with all applicable registration and labor compliance requirements. Any stop orders issued by the Department of Industrial Relations against Consultant or any subcontractor that affect Consultant’s performance of services, including any delay, shall be Consultant’s sole responsibility. Any delay arising out of or resulting from such stop orders shall be considered Consultant caused delay and shall not be compensable by the City. Consultant shall defend, indemnify and hold the City, its officials, officers, employees and agents free and harmless from any claim or liability arising out of stop orders issued by the Department of Industrial Relations against Consultant or any subcontractor. 14. Verification of Employment Eligibility. 9 Updated Feb. 2020 By executing this Agreement, Consultant verifies that it fully complies with all requirements and restrictions of state and federal law respecting the employment of undocumented aliens, including, but not limited to, the Immigration Reform and Control Act of 1986, as may be amended from time to time, and shall require all subconsultants and sub-subconsultants to comply with the same. 16. Laws and Venue. This Agreement shall be interpreted in accordance with the laws of the State of California. If any action is brought to interpret or enforce any term of this Agreement, the action shall be brought in a state or federal court situated in the County of Los Angeles, State of California. 17 Termination or Abandonment a. City has the right to terminate or abandon any portion or all of the work under this Agreement by giving ten (10) calendar days written notice to Consultant. In such event, City shall be immediately given title and possession to all original field notes, drawings and specifications, written reports and other documents produced or developed for that portion of the work completed and/or being abandoned. City shall pay Consultant the reasonable value of services rendered for any portion of the work completed prior to termination. If said termination occurs prior to completion of any task for the Project for which a payment request has not been received, the charge for services performed during such task shall be the reasonable value of such services, based on an amount mutually agreed to by City and Consultant of the portion of such task completed but not paid prior to said termination. City shall not be liable for any costs other than the charges or portions thereof which are specified herein. Consultant shall not be entitled to payment for unperformed services, and shall not be entitled to damages or compensation for termination of work. b. Consultant may terminate its obligation to provide further services under this Agreement upon thirty (30) calendar days’ written notice to City only in the event of substantial failure by City to perform in accordance with the terms of this Agreement through no fault of Consultant. 18 Documents. Except as otherwise provided in “Termination or Abandonment,” above, all original field notes, written reports, Drawings and Specifications and other documents, produced or developed for the Project shall, upon payment in full for the services described in this Agreement, be furnished to and become the property of the City. 19. Organization Consultant shall assign John Chaquica as Project Manager. The Project Manager shall not be removed from the Project or reassigned without the prior written consent of the City. 20. Limitation of Agreement. This Agreement is limited to and includes only the work included in the Project described above. 21. Notice 10 Updated Feb. 2020 Any notice or instrument required to be given or delivered by this Agreement may be given or delivered by depositing the same in any United States Post Office, certified mail, return receipt requested, postage prepaid, addressed to: CITY: City of Arcadia 240 West Huntington Drive Arcadia, CA 91066 Attn: Hue C. Quach, Administrative Services Department CONSULTANT: George Hills Company, Inc. P.O. BOX 278 Rancho Cordova, CA 95741 Attn: John Chaquica, Chief Executive Officer CIPA: California Insurance Pool Authority 366 San Miguel Drive, Suite 312 Newport Beach, CA 92660 Attn: Janet Kiser, General Manager and shall be effective upon receipt thereof. 22. Third Party Rights Nothing in this Agreement shall be construed to give any rights or benefits to anyone other than the City and the Consultant. 23. Equal Opportunity Employment. Consultant represents that it is an equal opportunity employer and that it shall not discriminate against any employee or applicant for employment because of race, religion, color, national origin, ancestry, sex, age or other interests protected by the State or Federal Constitutions. Such non-discrimination shall include, but not be limited to, all activities related to initial employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination. 24. Entire Agreement This Agreement, with its exhibits, represents the entire understanding of City and Consultant as to those matters contained herein, and supersedes and cancels any prior or 11 Updated Feb. 2020 contemporaneous oral or written understanding, promises or representations with respect to those matters covered hereunder. Each party acknowledges that no representations, inducements, promises or agreements have been made by any person which are not incorporated herein, and that any other agreements shall be void. This Agreement may not be modified or altered except in writing signed by both Parties hereto. This is an integrated Agreement. 25. Severability The unenforceability, invalidity or illegality of any provision(s) of this Agreement shall not render the provisions unenforceable, invalid or illegal. 26. Successors and Assigns This Agreement shall be binding upon and shall inure to the benefit of the successors in interest, executors, administrators and assigns of each party to this Agreement. However, Consultant shall not assign or transfer by operation of law or otherwise any or all of its rights, burdens, duties or obligations without the prior written consent of City. Any attempted assignment without such consent shall be invalid and void. 27. Non-Waiver None of the provisions of this Agreement shall be considered waived by either party, unless such waiver is specifically specified in writing. 28. Time of Essence Time is of the essence for each and every provision of this Agreement. 29. City’s Right to Employ Other Consultants City reserves its right to employ other consultants, including engineers, in connection with this Project or other projects. 30. Prohibited Interests Consultant maintains and warrants that it has not employed nor retained any company or person, other than a bona fide employee working solely for Consultant, to solicit or secure this Agreement. Further, Consultant warrants that it has not paid nor has it agreed to pay any company or person, other than a bona fide employee working solely for Consultant, any fee, commission, percentage, brokerage fee, gift or other consideration contingent upon or resulting from the award or making of this Agreement. For breach or violation of this warranty, City shall have the right to rescind this Agreement without liability. For the term of this Agreement, no director, official, officer or employee of City, during the term of his or her service with City, shall have any direct interest in this Agreement, or obtain any present or anticipated material benefit arising therefrom. [SIGNATURES ON FOLLOWING PAGE] 12 Updated Feb. 2020 SIGNATURE PAGE FOR PROFESSIONAL SERVICES AGREEMENT BETWEEN THE CITY OF ARCADIA, CALIFORNIA INSURANCE POOL AUTHORITY, AND GEORGE HILLS COMPANY, INC. IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first written above. CITY OF ARCADIA CALIFORNIA INSURANCE POOL AUTHORITY By: By: Dominic Lazzaretto Signature City Manager Date: Title: General Manager ATTEST: Printed Name By: Date: City Clerk GEORGE HILLS COMPANY, INC. APPROVED AS TO FORM By: Signature By: Title: Chief Executive Officer Stephen P. Deitsch City Attorney Printed Name 13 Updated Feb. 2020 EXHIBIT “A” Scope of Services MINIMUM PERFORMANCE STANDARDS FOR LIABILITY CLAIMS ADMINISTRATION POLICY 1. CASELOADS A. Caseloads for claims examiners shall not exceed 175 claims, unless approved in writing by the Member Agency and/or CIPA. B. Supervisory personnel shall not handle a caseload. Exceptions may be made for a small number of claims involving special issues. C. Administrator shall provide CIPA and Member Agency with an accounting of caseloads each June 30 and December 31. The accounting for each examiner shall include (1) the name or pseudo name of all assigned clients; and (2) the number of claims for each client. Each examiner shall sign acknowledgement of their claims count and provide to CIPA and Member Agency. 2. COMMUNICATION A. If claimant is not represented by an attorney, contact claimant within twenty-four (24) hours of receipt of a claim and maintain appropriate contact with them until the claim is closed, unless otherwise directed by the Member Agency. If claimant not contacted, the reason shall be documented in file. B. Telephone calls will be returned within twenty-four (24) hours. If the staff member called is not available within this timeframe, another designated staff member will return the call. C. All written communications received shall be stamped with date of receipt. D. Respond to emails within forty-eight (48) hours, unless an immediate response is required. If staff member does not have the information being requested at the time they respond, the response should include a date by which they will provide the requested information. E. Claims Administrator shall respond to all other written communications within five (5) business days of receipt or sooner if an immediate response is required. 3. INVESTIGATIONS A. When required on non-litigated claims, statements from or interviews with claimant(s) and witnesses shall be taken within three (3) business days of receipt of a claim. Statements will be preserved by recording or taking hand-written signed statements and interviews shall be documented. B. Examiner shall take steps to ensure proper preservation of evidence. C. Further investigate claims where the initial review indicates that it is warranted. Further investigation may include, but not be limited to, on-site investigation, taking photographs, interviewing witnesses, taking signed or recorded statements, verifying damage or loss, taking measurements, or obtaining maps/diagrams, medical releases, police reports, vendor contracts, third-party contracts, insurance documents, internal operations investigations, paramedic reports, marine department reports, building permits, or other records as required. Initial investigations shall be completed within forty- five (45) calendar days of receipt. The efforts to complete the initial investigation and any further investigations shall be documented in the file, including any reason for delay. 14 Updated Feb. 2020 D. Within forty-five (45) calendar days, identify and document in the file all liability issues, including but not limited to immunities, comparative negligence, joint tortfeasors, and joint and several liability E. Within forty-five (45) calendar days, identify and document in the file all damages, including property damage, nature and extent of injuries, medical costs, lost wages, and non-economic damages. The efforts to complete shall be documented in the file, including any reason for delay. F. Evaluate need to utilize experts and obtain approval from Member Agency, and CIPA if indicated. G. Within fifteen (15) calendar days of receipt of claim, report bodily injury cases to the Index Bureau and re-index as needed. If not reported, the reason shall be documented in file. H. Within three (3) business days of receipt of a claim, arrange for appraisal of damaged property when indicated. If appraisal not obtained, the reason shall be documented in file. I. Investigative assignments to outside vendors will only be made with approval from Member Agency, and CIPA if indicated J. All notices, including claim insufficiency, late claims, rejections, etc., shall be done in accordance with the relevant Governmental Code provisions. 4. FILE REVIEW & DOCUMENTATION A. Claims will be initially reviewed and entered in the computer system within twenty-four (24) hours of receipt. B. Calendar all files at appropriate intervals and no less frequently than every sixty (60) calendar days to allow for timely completion of required activity. Rejected claims shall be diaried every ninety (90) days or as directed by Member Agency. C. All activity, including phone calls, correspondence and the rationale for decisions shall be clearly and concisely documented in the files. D. All correspondence shall be contained in the file. E. Notes and activities entered in the computer system must be dated and identify who completed the entry. F. File notes shall not be copied from prior entries without reviewing for relevance and accuracy. G. An active case strategy shall be documented in the file until closure. H. Maintain accurate and complete records of all payments. I. Provide Member Agency and CIPA with copies of file correspondence and documentation as requested. J. All files shall be reviewed for closure and closed within seven (7) calendar days from date all issues have been resolved. 5. REPORTING A. Provide first status report within thirty (30) calendar days of receipt of claim to Member Agency. Send report to CIPA General Manager when claim meets designated criteria. 15 Updated Feb. 2020 B. Subsequent status reports shall be provided no less than every ninety (90) calendar days. Status reports shall focus on changes in liability analysis, damages, and reserves. C. Provide Member Agency and CIPA, if applicable, with a status report outlining the facts of the case, results of investigations, primary issues, requested action and any related documentation within fourteen (14) calendar days of receipt of lawsuit. D. Provide clear and concise narrative reports when recommending rejection or settlement of a claim, when claim is going to trial, or when other significant events occur. E. CIPA shall be provided with closing documents and an accounting of the final paid amounts within fifteen (15) calendar days from the day the final defense bill is paid on claims involving CIPA funds. 6. LITIGATION MANAGEMENT A. Forward Litigation Acknowledgement Form to defense attorneys when case assigned (do not wait until lawsuit filed). The claims administrator shall follow-up no less than every five (5) business days for receipt of Litigation Acknowledgement Form, as expenses incurred prior to receipt do not count toward a Member Agency’s self-insured retention (SIR). B. If the billed amount of attorney’s fees and costs exceed seventy-five (75) percent of the total budget, then George Hills shall request an updated budget. C. Defense attorneys shall copy CIPA on all correspondence related to reportable claims. George Hills shall immediately notify the defense attorney if CIPA is not copied on any correspondence. D. Assist trial attorney in preparation of litigation and negotiation of settlements at request of Member Agency and/or CIPA and provide trial attorney with all necessary documentation. E. Assist trial attorney in answering interrogatories. F. Attend mediations, mandatory and voluntary settlement conferences, and arbitrations as requested. G. Assist Member Agency’s designated representative in small claims actions. H. Monitor performance of vendors for appropriateness of work and cost effectiveness. Any deficiencies should be reported to Member Agency and, if applicable, to CIPA. I. Claims Administrator is responsible for monitoring compliance with the Liability Program Defense Counsel Policy. The Member Agency and CIPA, if applicable, shall be copied on follow-up requests to defense attorneys when out of compliance. All claims administrators are responsible for being fully knowledgeable of requirements in the Liability Program Defense Counsel Policy. 7. CLAIM RESOLUTION AND SETTLEMENT AUTHORITY A. Process any claim or potential claim for settlement in accordance with instructions and policies of Member Agency and in accordance with the California Government Code. B. Obtain a fully executed release on all settlements and dismissals. C. All settlement offers requiring any payment or potential payment from CIPA must be approved in writing in advance by CIPA. Neither the examiner nor legal counsel shall make any recommendations or commitments to injured employees or their legal counsel for settlements that involve or potentially involve CIPA funds without CIPA’s prior approval. 16 Updated Feb. 2020 D. Proof of settlement authorization from the Member Agency and CIPA, if applicable, shall be maintained in the file. 8. PAYMENTS & RESERVES A. Review and process payments within authority level within twenty (20) calendar days of receipt. B. Each claim shall be reserved at the most probable outcome and evaluated based on the merits of the claim. This includes but is not limited to damages, past and future medical expenses, loss of income, pain and suffering, plaintiff’s attorney fees, defense costs, comparative negligence, facts of loss, defense counsel evaluations, and jury verdicts. The file shall document the rational for the reserves. C. At all times, reserves shall reflect the current information in the file and reserves shall be reviewed for adequacy at each diary review and no less frequently than every ninety (90) calendar days and the file shall document this required review of reserves. D. Review proposed reserve changes with CIPA General Manager prior to making changes on any claims with potential exposure to CIPA. 9. EXCESS INSURANCE REPORTING A. Claims administrator shall report to the reinsurance/excess insurance carrier(s), including CIPA, in accordance with reporting requirements established by CIPA and each insurance carrier above CIPA. B. Quarterly reporting shall be in a format prescribed by CIPA, as may be modified from time to time. C. As defined by CIPA’s Memorandum of Coverage, all claims with reserves or potential payments, including defense costs that are 50% or more of a Member Agency’s SIR, or involving any of the following, shall be considered “excess claims” and reported in writing to the General Manager of CIPA within two (2) business days after receipt by claims administrator. 1) Paralysis – Paraplegia, Quadriplegia 2) Loss of eye(s) or limb(s) 3) Spinal cord or brain injury 4) Sensory organ or nerve injury, or neurological deficit 5) Serious burns 6) Substantial disability or disfigurement 7) Death 8) Amputation or loss of use of a major extremity 9) Rape, sexual abuse offense/molestation of any individual 10) Any disability where it appears reasonably likely that there will be disability that lasts for more than one year 11) Class Action 12) Employment Practices Liability claims regardless of claim reserves 10. SUPERVISORY REVIEW 17 Updated Feb. 2020 A. Supervisors shall review claims no less frequently than every 120 calendar days. The supervisor shall document the scope of the review and include any recommendations. 11. SUBROGATION A. Subrogation possibilities will be identified within five (5) business days after a claim is opened, or within five (5) business days after information is available that subrogation may exist. The claim file shall document subrogation possibilities and all action related to pursuing. B. The party responsible for the injury shall be notified of the Member Agency’s or CIPA’s right to subrogation within fourteen (14) calendar days after the identity of the responsible party is known by claims administrator. C. Contact with the responsible party and/or insurer to provide notification of the amount of estimated recovery shall be made at least every sixty (60) calendar days or sooner if costs escalate. D. Member Agency’s approval is required to waive pursuit of subrogation or agree to a settlement of a third-party recovery. This approval shall be documented in the claim file. E. CIPA’s approval is required to waive pursuit of subrogation or agree to a third-party settlement if there is potential for the claim to exceed the Member Agency’s SIR. 12. MEDICARE REPORTING A. Claims Administrator shall report all claims in compliance with Medicare, Medicaid, and SCHIP Extension Act (MMSEA) Section 111 Mandatory reporting. B. Medicare eligibility shall be documented in the file no later than at the time the file is evaluated for settlement.