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HomeMy WebLinkAboutActuarial Services Agreement - Cavanaugh MacDonald Consulting LLC - GASB Valuation Report and Police Pension Fund1316 COUNTY -CITY BUILDING 227 W Ji,,�,,n.;,moN BOULUARD Souni BEND. INDIANA 46601-1830 CITYCif" SOUTH BEND PETEBUTTIGIEG, MAYOR BOARD OF PUBLIC WORKS March 27, 2018 Brent Banister Cavanaugh Macdonald Consulting, LLC 3550 Bus,bee Parkway, Suite 250 Kennesaw, GA 30144 RE: Actuarial Services Agreement Dear Mr. Banister: Mioxi", 574/235-9251 FAX 574/ 235-9171 The Board of Public Works, at its meeting held on March 27, 2018, approved the above referenced agreement regarding the GASB 67/68 Valuation Report for the 1937 Firefighters' Pension Fund and 1925 Police Pension Fund in the amount of $6,400. Enclosed please find the original of the agreement for your signature. Please sign and return the original agreement to our office and retain a copy for your records. If you have any further questions regarding this matter, please call this office at (574) 235- 9251. Sincerely, Linda M. Martin, Clerk Enclosure c: Jen Hockenhull, Administration & Finance GARY A. CA.,o-j, SUZANNA M. FRITZBERG ELIZABETI i A. MARADIK JAMEs A. MUELLER TIJERESE J. DORAU ACTUARIAL SERVICES AGREEMENT THIS AGREEMENT, made and entered into effect this al day of MUCK, 20AIfiy and among the City or Town of b1,()CL (hereinafter referred to as "Sponsor") and CAVANAUGH MACDONALD CONSULTING, LLC, a Georgia corporation, 3550 Busbee Parkway, Suite 250, Kennesaw, Georgia 30144, (hereinafter referred to as "CMC") WITNESSETH: WHEREAS the SPONSOR is desirous of retaining professional actuarial and pension consulting services to the SPONSOR; and WHEREAS the SPONSOR selected CMC for that purpose; NOW, THEREFORE, in consideration of the premises and of the mutual covenants and promises therein contained, the parties hereto agree as follows: 1. Annual GASB 68 Actuarial Valuations— At the direction of the SPONSOR, CMC shall prepare an actuarial valuation as of January I" of each year for disclosure under GASB 68. Such valuations are to be based on detailed and up-to-date tabulations of active and inactive participants, current pensioners, and any other such detailed information as CMC and the SPONSOR may mutually determine to be pertinent to the purpose of the review. Such actuarial valuation shall provide all financial and statistical information as may be now required to prepare financial statements under generally accepted accounting principles (GAAP), 2. Term and Termination --- The performance of this Agreement shall commence on the date first hereinabove recited. This Agreement may be terminated: (a) by CMC by providing written notice to the SPONSOR at least sixty (60) days prior to such termination, or (b) by the SPONSOR by providing written notice to CMC at least thirty (30) days prior to such termination provided, however, that this Agreement may be terminated by CMC pursuant to clause (a) above only for reasonable cause relating to CMC's continued ability to provide effective services to the SPONSOR, with such reasonable causes including but not limited to insolvency, sale of the business, or substantial turnover of key personnel; and further provided that this Agreement may be terminated by the SPONSOR pursuant to clause (b) above for any reason or no reason. In the event the Contract is terminated, CMC shall be paid for work actually performed to the date of termination, plus bona fide expenses to date of termination, less the cost to the SPONSOR of making good any deficiencies, correcting all work improperly performed and any additional cost to the SPONSOR for removing or replacing CMC exclusive of fees to firm(s) hired to replace CMC. Said final payment shall be made to CMC within 30 days of the date of final invoice. 3. Miscellaneous Provisions — This Agreement constitutes the entire Agreement and understanding between the SPONSOR and CMC with respect to all matters contained herein, including the following: ACTUARIAL SERVICES AGREEMENT a. CMC agrees to make no assignment of any of its rights, duties or obligations under this Agreement without the specific approval of the SPONSOR. b. CMC agrees to indemnify and hold harmless the SPONSOR and its officers, employees or agents, including but not limited to the Plan Administrator for any claims or causes of action which may arise against the SPONSOR as a result of any negligence or malfeasance on the part of CMC in the performance of its duties under this Agreement. C. This Agreement shall be construed in accordance with the laws of the State of Georgia and any remedies of the parties pertaining thereto shall likewise be governed by the laws of the State of Georgia. d. CMC agrees to abide with all applicable federal, state and local laws and rules and agrees to act in accordance with the standards of the actuarial profession. C. CMC agrees to carry a limit of liability of at least one million dollars in Errors & Omissions Insurance coverage, exclusive of defense costs. f. This Agreement, constituting the entire Agreement and understanding between the SPONSOR and CMC shall be construed to be in accordance with the laws of the State of Georgia and any remedies of the parties pertaining thereto shall likewise be governed by the laws of the State of Georgia. 4. Nondiscrimination Clause — In performing work hereunder, CMC shall comply with all applicable equal employment opportunity laws and regulations. 5. Ownership of Data and Work Product — The SPONSOR will permit the Indiana Public Employees Retirement System to provide CMC such data related to the SPONSOR and the participants, beneficiaries and other individuals interested therein (collectively, the "Data") as is necessary to permit the services to be provided by CMC under this Agreement. In addition, all materials prepared by CMC specifically and exclusively for the SPONSOR pursuant to this Agreement ("work product") shall be exclusively owned by the SPONSOR and shall be deemed works made for hire. In the event any work product may not, by operation of law, be works for hire, CMC hereby assigns to the SPONSOR all of its rights in such work product and copyrights therein. b. Fees and Char es Annual GASB 68 Actuarial Valuation $ 3,200 These rates shall remain fixed for the 2018 and 2019 valuations. ACTUARIAL SERVICES AGREEMENT IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective on the date first hereinabove recited, SPONSOR Name: By: A141:1U0VSD 0"ard of Pf.-Thlif" Printed Name: MAR 2" Q 'Title: Address: Phone: E-mail: CAVANAUGH MACDONALD CONSULTING, LLC By: Brent A. Banister, FSA, FCA, MAAA Title: Chief Actuary Cavanaugh Macdonald Consulting, LLC, is a premier national consulting firm that provides actuarial services to state and local governments and retirement systems. As the retained actuary for INPRS, they are responsible for preparing results for the state of Indiana for the 1925,Police Pension Fund, the 1937 Firefighters' Pension Fund, and the 1953 Police Pension Fund. Since these results contain much of the information needed for the participating employers in these funds to report under the GA&B 68 accounting standards, Cavanaugh Macdonald is able to efficiently provide the needed reports to the employers at a significant discount. For those employers who wish to utilize this service, please complete a contract (attached) for each applicable system (fire and/or police). These contracts may Ibe returned to: Brent Banister Chief Actuary Cavanaugh Macdonald Consulting b_re qb C kc a v njzLc Itin c �.corn g� They may also be mailed to Brent at 3906 Raynor Pkwy, Ste 106 Bellevue, NE 68123 Jennifer Flockenhull From: Cullen, James <JCulien@inprs,in.gov> Sent: Monday, December 04, 2017 6:36 PM To: Jennifer Hockenhull; jmurphiy@southbend'in.gov Cc- brentb@cavmacconsulting.com; Biough, Robert A (Andy); Haggard, Jeremy Subject: City of South Bend Pension Relief Actuarial Valuations for 12/31/17 Attachments: CMC background.docx; Professional Service Agreement - Indiana Local Fire or Police.pdf Follow Up Flag: Follow up Due By: Friday, December 15, 2017 1:00 PM Flag Status: Flagged INPRS has recently contracted with a new actuary, Cavanaugh Macdonald (CavMac) to replace PwC. CavMac has agreed to provide actuarial valuations for each of your pension relief pension plans (police and/or fire) as of 12/31/17. CavMac has included a brief document about their background for your review. The contact at Cavanaugh Macdonald is Brent Banister and his information is: Brent A. Banister, Ph.D., FSA, EA, MAAA, A. Chief Actuary Cavanaugh Macclonald Consulting, LLC 3906 Raynor Parkway, Suite 1,06 Bellevue, NE 68123 Phone 402 905 4462 Cell 402 709i 2927 F'ax 402 905 4464 1 a V 111111R I I A WRJOSS� Like PwC last year, CavMac will use the prior year (1/1/17) census data that has been provided and actuarially roll forward the information to 12/31/17. However, to ensure there hasn't been any significant changes, Ca,vMac would greatly appreciate for each organization to report their information early to the INPRS EPPA organization. We would like you to submit your data to INPRS no later than January 15, 2018. INPRS will process your information before all of the non-GAAP basis employers and forward it sooner to CavMac, in order for each of you to receive the valuations in time for your CAFR's. The cost per plan is $3,200 per plan (total of $6,400 for both police and fire), and these fees are reimbursable by the pension relief fund (as long as CavMac: confirms payment from your organization). CavMac plans to have the actuariail valuations completed in, March. Attached is a contract from CavMac for your organization to sign and return to Brent Banister (please copy Andy Blough and I). After receiving the actuarial valuations, it is your responsibility to pay CavMac. Once CavMac confirms receipt of payment, INPRS will reimburse your expense as part of your pension relief payment in June. If CavMac doesn't confirm payment, you will not receive reimbursement. Sincerely, Date Name BOARD OF PUBLIC WORKS AGENDA ITEM REVIEW REQUEST FORM Jennifer Hockenhull R r • Phone Extension Legal Attorney Name Clara McDaniel Controller Controller review is required for all Contracts $5,000.00 or more and greater than one year in length per the City Purchasing Policy Purchasing Agreement. Contract LJ Proposal Ll Addendum M Professional Services El Resolution F1 Bid Opening ❑ Bid Award 0 Req. to Advertise ❑ Title Sheet Quote Opening ❑ Quote Award ❑ Change Order No. ❑ C/O & PCA No, 0 PCA DI Ease/Encroach. ❑ Traffic Control n Other: Company or Vendor Name Cavanaugh Macdonald Consulting New Vendor M Yes n No E If Yes, Approved by Purchasing MBEANBE Contractor ❑ MBE ❑ WBE MBE' NBE Contractor Requested E No E] Yes Name of Company (Consultant chosen by INPRS) Project Name GASB Reports for the Police and Fire Department Project Number Funding Source General Fund-Admin Fin Budget Account No. 702-0803-645-31016 & 701-0903-645-3106 Amount $ 6400 ($3,200 for Police & $3,200 for Fire) Terms of Contract Due upon completion of contract Purpose/Description GASB 6 /68 Valuation Report for the 1937 Firefighters' Pension Fund and valuation report for the 1925 Police Pension Fund Z Required Contractor's Certification Form Attached (Non - Collusion, Non-Discrimli nation, Non -Debarment, E-Verify, Iran, etc.) Required For 'Change Orders Only ❑ $ Amount of ❑ Decrease $ Previous Amount $ Current Percent of Change: % New Amount $ Total Percent of Change; % Dispersal After Approval Copy Original M ❑ Jennifer Hockenhull ❑ ❑ ❑ ❑