HomeMy WebLinkAbout11188RESOLUTION NO. 11188
A RESOLUTION APPROVING A SERVICE AGREEMENT BETWEEN THE CITY OF PUEBLO
AND SUMMIT POINT CONSULTING RELATING TO WORKERS' COMPENSATION
BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that:
SECTION 1.
The Service Agreement between the City of Pueblo and Summit Point Consulting
relating to workers' compensation, a copy of which is attached hereto, having been approved as
to form by the City Attorney, is hereby approved. The President of the City Council is
authorized to execute and deliver the Service Agreement in the name of the City and the City
Clerk is directed to affix the seal of the City thereto and attest same.
SECTION 2.
This Resolution shall become effective upon final passage and approval.
INTRODUCED December 31, 2007
ATTESTED BY
APPROVED:
ESID NTof City Council
CITY CLERK
Randy Thurston
Councilperson
Res. 11 188
D �I �
Background Paper for Proposed
RESOLUTION
AGENDA ITEM # /S
DATE: December 31, 2007
DEPARTMENT: Law Department
TITLE
A RESOLUTION APPROVING A SERVICE AGREEMENT BETWEEN THE CITY OF
PUEBLO AND SUMMIT POINT CONSULTING RELATING TO WORKERS'
COMPENSATION
ISSUE
Should City Council approve an agreement with Summit Point Consulting?
RECOMMENDATION
Approve the agreement.
BACKGROUND
Summit Point Consulting will act as third party administrator for City's self- insured
workers' compensation program and claims for an annual fee as follows: 2008 -
$45,500, 2009 - $53,708 and 2010 - $58,273. Fees payable after 2008 are subject to
funds being appropriated and budgeted specifically for such purpose. Computer access
will be provided for an additional fee of $10,000 beginning January 1, 2009. City may
terminate the agreement upon 60 days notice.
FINANCIAL IMPACT
See Background.
JAN 1 4 2008
SERVICE AGREEMENT Iu "
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RECITALS
This agreement confirms Summit Point Consulting (hereinafter referred to as "SPC ")
and Hub International Southwest Agency, Limited (hereinafter referred to as "HUB ")
mutual intention to transfer the Third Party Claim Administration (TPA) for the City of
Pueblo (hereinafter referred to as "Employer ") workers' compensation claims from
HUB to SPC.
AGREEMENT
In consideration of the mutual covenants herein contained, SPC, an independent
contractor, does hereby contract and agree with The City of Pueblo, hereinafter .
referred to as the "Employer as follows:
Appointment. The Employer hereby appoints SPC as Service Agent upon
the terms and conditions hereinafter set forth.
2. Term. This Service Agreement shall be effective from 12:01 a.m., January
1, 2008, to December 31, 2010. The financial obligations of the City in any
fiscal year after fiscal year 2008 is subject to funds being appropriated and
budgeted specifically for such purpose. The City may terminate this
agreement upon sixty (60) days' written notice to SPC. SPC may withdraw
from this agreement upon sixty (60) days' written notice to the City.
3. Duties and Authority of SPC. The services to be performed by SPC, during
the time this Agreement remains in effect, shall include:
3.1 Act as advisor and representative of the Employer in all
matters pertaining to the administration of Workers
Compensation injuries imposed by the Colorado Workers'
Compensation Act.
3.2 Compile and file notices, reports, and forms required under the
Colorado Workers' Compensation Act upon receipt of the first
report of injury from the Employer.
3.3 Maintain records by departments of all details incident to
payments made to fulfill the obligations of the Employer under
the Colorado Workers' Compensation Act with appropriate
claims reporting software. SPC will provide quarterly medical
cost saving reports to Employer. SPC will convert existing
claims data from the Pacaso system to its System at no
additional cost to Employer. SPC will provide access to the
adjuster's notes and reporting software to HUB and Employer
approximately 16 weeks from receipt of the Pacaso data free
of charge for the remainder of 2008. Computer access will be
provided as long as this Agreement remains in effect for an
additional fee of $10,000 per year beginning on January 1,
2009.
Agreement Page 1
ii
JAN 1 4 2008
3.4 It is expressly understood that SPC shall not qe rgUrft� .tq
advance its own funds to pay losses or Ilociv
expenses hereunder. It is further understood tha i mployer
fails to provide funds sufficient to allow required payments to
be made timely, SPC will have no obligation to perform any
further services and may terminate this Agreement upon three
(3) days' written notice. The Employer is liable for any fees,
fines, or penalties resulting from any delays in providing funds
to SPC.
3.5 Make such investigations as it deems necessary to determine
such obligations and negotiate the settlement of and /or affect
the compromise of any claims or suits arising out of such
obligations. Claims handling and settlements will be handled
as outlined by the Quality Service Plan (hereinafter referred to
as "ASPS).
3.6 Arrange for the defense of any claims, suits, or other
proceeding arising out of, or claimed to arise out of, such
obligations per the QSP. The cost of any such defense shall
be paid by the Employer and included in its allocated loss
adjustment expenses.
3.7 Furnish claim reports and records per the QSP, which will
include records by departments showing:
a. The number, type, and severity of accidents.
b. All payments made by, or on behalf of, Employer for
benefits or expenses.
C. Estimate of all reserves for actual, anticipated, or
potential benefits or expenses.
All work, data, drawings, designs, plans, reports, studies,
computer programs (nonproprietary), computer input and
output, analyses, tests, maps, surveys, or any other materials
developed and maintained as a part of these contracted
services are and shall be the sole and exclusive property of
the Employer. Claim files will be maintained and stored by
SPC for a period of seven (7) years from the date of closing as
long as this Agreement or a renewal of such Agreement
remains in effect. At the end of this period or the termination
of this agreement, all physical records will be turned over to
the Employer. All computer records will be maintained
indefinitely as long as this Agreement or its renewal remains in
effect. Upon termination of this Agreement an extract of the
data will be provided to the Employer for an agreed upon fee.
3.8 Conduct loss prevention inspections, attend safety meetings,
and perform such other duties as requested by the Employer
to assist in the conduct of the Employer's Workers'
Compensation Loss Prevention Program at an additional rate
of $100 per hour.
Agreement Page 2
- .• rJ 1 4 2008 U
4. Compensation. The annual service fee payable during the term of ft @;FGCdcKVicE
Agreement by the Employer to SPC in consideration of the services , utlirug oFFiCE
above shall be:
Term Fee
Jan! 1 2008 — December 31. 2008 $49,500
January 1 2009 — December 31, 2009 $53,708
January 1 2010 —December 31 2010 $58.273
These fees will be billed at the beginning of each month to Employer and
shall be due and payable by the Employer upon receipt. In addition, the
Employer will be billed each month for the estimated banking fees and
charges. If claim volume increases by greater than ten percent (10 %) in
any term, this fee is subject to renegotiation.
5. Termination. In addition to the provisions of paragraph 2 above, either
Employer or SPC may terminate this Agreement at any time for material
breach of contract, gross negligence, wanton misconduct, or fraud. Such
termination for cause shall be by written notice specifying the grounds for
termination. Said notice shall be effective when received except in the case
of material breach of contract. In the case of material breach of contract,
said notice shall be effective if the breach is not cured within thirty (30) days
of receipt of written notice specifying the material breach.
Upon any termination of this Agreement, SPC shall return all books,
records, files, and other items pertaining to the Employer and its claims and
shall have no further obligation to perform any services imposed upon SPC
by this Agreement. SPC shall further assist in the orderly transition of such
administration.
At the Employer's option, SPC agrees to continue the handling of all claims
open 45 days after termination of this Agreement to conclusion for a fee of
$300.00 per claim. This fee does not include access to the claims
management system as indicated in Section 3.3. In the event of
cancellation or non - renewal of subsequent year contracts, this per claim
charge shall be adjusted by the Consumer Price Index changes from
January 1, 2007.
6. Claims Payments. SPC will maintain an escrow account in its name and will
issue claim checks out of this account. This account will be funded by the
Employer with an initial deposit equal to four (4) weeks of expected claim
payments. SPC will provide Employer a weekly check register and the
Employer will make an ACH deposit equal to the amount of the weekly
check register to restore the escrow account to its original balance. Such
ACH deposit will be made within one week of receipt of the check register.
The Employer is responsible only for the bank fees and charges to maintain
the escrow account.
7. Waiver of Breach. Failure to either party to claim a breach or to terminate
this Agreement when cause for termination exists shall not constitute a
waiver of subsequent breaches or subsequent causes for termination.
Agreement Page 3
JAN 1 4 2008
Indemnification. To the extent permitted by law, SPC will jndeF=Wysnd
save harmless Employer from all claims, losses, damages,
expenses caused by or resulting from the negligence or fraud of SPC or its
officers, employees or agents.
9. Modification. This Agreement may only be amended or modified by a
writing signed by the parties hereto.
10. Binding Effect. The Agreement is binding upon and shall inure to the benefit
of the parties hereto, their successors by merger or consolidation, and upon
their assigns approved by the other party in writing.
11. Entire Agreement. This Agreement constitutes the entire Agreement
between the parties.
12. Applicable Law. This Agreement shall be governed, construed, and
enforced in accordance with the laws of the State of Colorado.
13. SPC certifies that it does not knowingly employ or contract with an illegal
alien nor will SPC enter into a contact with a subcontractor that fails to
certify to SPC that the subcontractor shall not knowingly employ or contract
with an illegal alien to perform work under this contract.
If the SPC obtains actual knowledge that a subcontractor performing work
under this contract knowingly employs or contracts with an illegal alien, SPC
shall:
A. Notify the subcontractor within three (3) days that the SPC has received
such knowledge; and
B. Terminate the subcontract with the subcontractor if within three (3) days
of receiving the notice required pursuant to subparagraph A. above the
subcontractor does not stop employing or contracting with the illegal
alien; except that SPC shall not terminate the contract with the
subcontractor if, during such three (3) days, the subcontractor provides
information to establish that the subcontractor has not knowingly
employed or contracted with an illegal alien.
SPC will comply with any reasonable request by the Colorado Department
of Labor and Employment (hereinafter referred to as "CDLE ") made in the
course of an investigation that CDLE is undertaking pursuant to its authority
under 8- 17.5- 102(5), C.R.S.
Violation of the provisions of Item 13 by SPC shall constitute a breach of
contract and grounds for termination. In the event of such termination, SPC
shall be liable for the City's actual and consequential damages.
Agreement Page 4
F. N 1 4 2008
CJFU, vamviCE
Dated at Pueblo, Colorado, as of .�i ee�w �z - 71 20 NVER OFFICE
SUMMIT POINT CONSULTING
INDEPENDENT CONTRACTOR
By:
Title: Prvs; A-
f_
CITY OF PUEBLO, COLORADO
By:
Title: President of 'Ci.ty.— Council
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&rd�XAJ&l
HUB INTERNATIONAL SOUTHWEST /SCA
By:
Ral h 4. Williams
Title: Senior Executive Vice Presid
Agreement Page 5