HomeMy WebLinkAbout10/3/2001 - STAFF REPORTS (14) DATE: October 3, 2001
TO: City Council
FROM: Risk Manager via Director of Procurement & Contracting
INSURANCE BROKERAGE SERVICES CONTRACT
RECOMMENDATION:
It is recommended that City Council ratify cancellation of the Professional
Services Agreement with Aon and approve a Professional Services Agreement
with Davis & Graeber Insurance Services, Inc. for a 5 year period at $52,000 per
year.
SUMMARY:
Aon has been the City's insurance Broker of Record since January 5, 2000. With
Aon's selection via a Request for Proposal (RFP) process 18 months ago, the
City changed the method utilized to acquire insurance from a multi-broker
commission basis to a single broker fixed fee basis.
The main advantage to this change is that a commissioned broker competing in
the market is limited in the number of carriers he may acquire quotes from on
behalf of the City. Utilizing a broker of record on a fixed fee basis allows access
to the entire insurance market. The ability to expose our insurance requirements
to a greater amount of competition will result in achieving the best coverage and
premiums available during a period in which many insurance companies have
experienced major losses, decreasing overall insurance capacity and increasing
rates.
The recommended action changes the company designated as our Broker of
Record from Aon to Davis & Graeber. It does not change our current fixed fee
basis. Although the contract term increases from the previous three-year period
to five years, there is a 30-day termination for convenience clause that protects
the City if services are not satisfactory.
BACKGROUND:
A meeting was conducted with Aon in October, 2000, which was the last quarter
of its first year of service, to discuss the dissatisfaction with Aon's services by the
City Manager, Risk Manager and Director of Human Resources. Aon made
assurances at that time that its level of services would improve, and explained to
staff that it had taken the first year to get to know the City's needs and programs,
and that the turnover in Aon's personnel during the first year would not be an
issue from that point forward. In July, 2001 Aon's entire Public Entities Support
Team (those same people who assured us the services would improve) left Aon
to go to work for Marsh. At that time, the City Manager authorized Procurement
to initiate the Request for Proposal process to select an insurance broker that
would perform the contractual services the City requires and in August, 2001 Aon
was notified of the City's intent to cancel the current contract for convenience.
4 h
At the City Council's direction, the City Manager established an Insurance
Subcommittee made up of the Assistant City Manager, Director of Human
Resources, Director of Procurement and Contracting, Risk Manager, and two city
council members. The charge of the subcommittee was to find an insurance
broker to provide for the City's Property, Liability and Workers Compensation
Insurance needs. Requests for Proposals were sent to 43 Insurance Brokers,
including 26 within the Coachella Valley. Seven proposals were received and
evaluated on the greatest potential for overall risk savings to the City.
Proposals Received:
Company Location Annual Fee*
1 Davis & Graeber Insurance Services. Inc. Redlands $52.000
2 Robert F. Driver Co., Inc. Newport Beach $52,500
3 Hooper, Hayes &Assoc., Inc. Los Angeles $55,000
4 Gallagher Woodland Hills $50,000
5 Aon Risk Services, Inc. of Southern Calif. Los Angeles $45,000
6 Marsh Risk & Insurance Services Newport Beach $68,500
7—Pan American Underwriters, Inc. Coachella $50,000 to
$150,000
*Several companies quoted different fees each year. The Fee shown is an average of
the first three years.
The committee rated candidates not only on their professional and technical
insurance and risk management consulting capabilities, but also on their
experience supporting public entities and on their proven track record. The three
candidates that were selected for oral interviews with the committee were Davis
& Graeber Insurance Services, Inc, Robert F. Driver Company, and Hooper
Hayes & Associates, Inc. All three of these companies have provided insurance
services for the City in the past and have proven themselves to be responsive
and professional. At the conclusion of the oral interviews, Davis & Graeber
Insurance Services, Inc. was selected unanimously as the best brokerage firm to
meet the City's needs.
It is recommended that City Council approve the contract. A Resolution is
attached for City Council consideration.
�74 O—L CLY� v L S
NANCY JO MC IN)� SH, ARM, MPA
Risk Manager
HAROLD E. GOOD, CPPO
Director of Procurement & Contracting
APPR EVO D
City Manager
REVIEWED BY DEPT.OF FINANCE
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ATTACHMENTS:
1. Contract Service Agreement
2. Resolution
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CITY OF PALM SPRINGS
CONTRACT SERVICES AGREEMENT FOR
THIS CONTRACT SERVICES AGREEMENT(herein "Agreement"), is made and entered
into this day of , 2001, by and between the CITY OF PALM
SPRINGS, a municipal corporation, (herein "City") and Davis & Graeber Insurance Services, Inc.
(herein "Contractor"). (The term Contractor includes professionals performing in a consulting
capacity.) The parties hereto agree as follows:
1.0 SERVICES OF CONTRACTOR
1.1 Scope of Services. In compliance with all terms and conditions of this
Agreement, the Contractor shall provide those services specified in the "Scope of Services"
attached hereto as Exhibit "A" and incorporated herein by this reference, which services may be
referred to herein as the "services" or "work" hereunder. As a material inducement to the City
entering into this Agreement, Contractor represents and warrants that Contractor is a provider of
first class work and services and Contractor is experienced in performing the work and services
contemplated herein and, in light of such status and experience, Contractor covenants that it shall
follow the highest professional standards in performing the work and services required hereunder
and that all materials will be of good quality, fit for the purpose intended. For purposes of this
Agreement, the phrase "highest professional standards" shall mean those standards of practice
recognized by one or more first-class firms performing similar work under similar circumstances.
1.2 Contractor's Proposal. The Scope of Service shall include the Contractor's
proposal or bid which shall be incorporated herein by this reference as though fully set forth herein.
In the event of any inconsistency between the terms of such proposal and this Agreement,the terms
of this Agreement shall govern.
1.3 Compliance with Law. All services rendered hereunder shall be provided in
accordance with all ordinances, resolutions, statutes, rules, and regulations of the City and any
Federal, State or local governmental agency having jurisdiction in effect at the time service is
rendered.
1.4 Licenses,Permits Fees and Assessments. Contractor shall obtain at its sole
cost and expense such licenses, permits and approvals as may be required by law for the
performance of the services required by this Agreement. Contractor shall have the sole obligation
to pay for any fees, assessments and taxes, plus applicable penalties and interest, which may be
imposed by law and arise from or are necessaryfor the Contractor's performance of the services
required by this Agreement, and shall indemnify, defend and hold harmless City against any such
fees,assessments,taxes penalties or interest levied,assessed or imposed against City hereunder.
1.5 Familiarity with Work. By executing this Contract, Contractor warrants that
Contractor(a) has thoroughly investigated and considered the scope of services to be performed,
(b) has carefully considered how the services should be performed, and fully understands the
facilities, difficulties and restrictions attending performance of the services under thisAgreement.
If the services involve work upon any site,Contractor warrants that Contractor has orwill investigate
the site and is or will be fully acquainted with the conditions there existing, prior to commencement
of services hereunder. Should the Contractor discover any latent or unknown conditions, which will
materially affectthe performance of the services hereunder,Contractorshall immediately inform the
City of such fact and shall not proceed except at Contractor's risk until written instructions are
received from the Contract Officer.
1.6 Care of Work. The Contractor shall adopt reasonable methods during the
life of the Agreement to furnish continuous protection to the work, and the equipment, materials,
papers,documents,plans, studies and/or other components thereof to prevent losses or damages,
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damages, and shall be responsible for all such damages, to persons or property, until acceptance
of the work by City, except such losses or damages as may be caused by City's own negligence.
1.7 Further Responsibilities of Parties. Both parties agree to use reasonable
care and diligence to perform their respective obligations under this Agreement. Both parties
agree to act in good faith to execute all instruments, prepare all documents and take all actions
as may be reasonably necessary to carry out the purposes of this Agreement. Unless hereafter
specified, neither party shall be responsible for the service of the other.
1.8 Additional Services. City shall have the right at any time during the
performance of the services,without invalidating this Agreement, to order extra work beyond that
specified in the Scope of Services or make changes by altering, adding to or deducting from said
work. No such extra work may be undertaken unless a written order is first given by the Contract
Officer to the Contractor, incorporating therein any adjustment in (i) the Contract Sum, and/or(ii)
the time to perform this Agreement,which said adjustments are subject to the written approval of
the Contractor. Any increase in compensation of up to five percent (5%) of the Contract Sum or
$25,000; whichever is less, or in the time to perform of up to one hundred eighty (180) days may
be approved by the Contract Officer. Any greater increases, taken either separately or
cumulatively must be approved by the City Council. It is expressly understood by Contractor that
the provisions of this Section shall not apply to services specifically set forth in the Scope of
Services or reasonably contemplated therein. Contractor hereby acknowledges that it accepts the
risk that the services to be provided pursuant to the Scope of Services maybe more costly or time
consuming than Contractor anticipates and that Contractor shall not be entitled to additional
compensation therefore.
1.9 Special Requirements. Additional terms and conditions of this Agreement,
if any, which are made a part hereof are set forth in the "Special Requirements" attached hereto
as Exhibit "B" and incorporated herein by this reference. In the event of a conflict between the
provisions of Exhibit"B"and any other provisions of this Agreement, the provisions of Exhibit"B"
shall govern.
2.0 COMPENSATION
2.1 Contract Sum. For the services rendered pursuant to this Agreement, the
Contractor shall be compensated in accordance with the "Schedule of Compensation" attached
hereto as Exhibit"C" and incorporated herein by this reference, but not exceeding the maximum
contract amount of Two Hundred Sixty Thousand Dollars ($260,000.00) (herein "Contract Sum"),
except as provided in Section 1.8. The method of compensation may include: (i) a lump sum
payment upon completion, (ii) payment in accordance with the percentage of completion of the
services, (iii) payment for time and materials based upon the Contractor's rates as specified in the
Schedule of Compensation, but not exceeding the Contract Sum or (iv) such other methods as
may be specified in the Schedule of Compensation. Compensation may include reimbursement
for actual and necessary expenditures for reproduction costs,telephone expense, transportation
expense approved by the Contract Officer in advance, and no other expenses and only if
specified in the Schedule of Compensation. The Contract Sum shall include the attendance of
Contractor at all project meetings reasonably deemed necessary by the City; Contractor shall not
be entitled to any additional compensation for attending said meetings.
2.2 Method of Payment. Unless some other method of payment is specified in
the Schedule of Compensation, in any month in which Contractor wishes to receive payment, no
later than the first(1 st)working day of such month, Contractor shall submit to the City in the form
approved by the City's Director of Finance, an invoice for services rendered prior to the date of
the invoice. Except as provided in Section 7.3, City shall pay Contractor for all expenses stated
thereon which are approved by City pursuant to this Agreement no later than the last working day
of the month.
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3.0 PERFORMANCE SCHEDULE
3.1 Time of Essence. Time is of the essence in the performance of this
Agreement.
3.2 Schedule of Performance. Contractor shall commence the services pursuant
to this Agreement upon receipt of a written notice to proceed and shall perform all services within
the time period(s) established in the"Schedule of Performance" attached hereto as Exhibit "D", if
any, and incorporated herein by this reference. When requested by the Contractor, extensions to
the time period(s) specified in the Schedule of Performance may be approved in writing by the
Contract Officer but not exceeding one hundred eighty (180) days cumulatively.
3.3 Force Maieure. The time period(s)specified in the Schedule of Performance
for performance of the services rendered pursuant to this Agreement shall be extended because
of any delays due to unforeseeable causes beyond the control and without the fault or negligence
of the Contractor, including, but not restricted to, acts of God or of the public enemy, unusually
severe weather,fires,earthquakes,floods, epidemics,quarantine restrictions, riots,strikes,freight
embargoes, wars, litigation, and/or acts of any governmental agency, including the City, if the
Contractorshall within ten(10)days of the commencement of such delay notify the Contract Officer
in writing of the causes of the delay. The Contract Officer shall ascertain the facts and the extent
of delay, and extend the time for performing the services for the period of the enforced delay when
and if in the judgment of the Contract Officer such delay is justified. The Contract Officer's
determination shall be final and conclusive upon the parties to this Agreement. In no event shall
Contractor be entitled to recover damages against the City for any delay in the performance of this
Agreement,however caused,Contractor's sole remedy being extension of the Agreement pursuant
to this Section.
3.4 Term. Unless earlier terminated in accordance with Section 7.8 of this
Agreement,this Agreement shall continue in full force and effect until completion of the services but
not exceeding five(5)years from the date hereof, except as otherwise provided in the Schedule of
Performance (Exhibit "D").
4.0 COORDINATION OF WORK
4.1 Representative of Contractor. The following principals of Contractor are
hereby designated as being the principals and representatives of Contractor authorized to act in its
behalf with respect to the work specified herein and make all decisions in connection therewith:
Ross Jones, Vice President
Davis & Graeber Insurance Services, Inc.
470 E. Highland Avenue
Redlands, CA 92373
It is expressly understood that the experience, knowledge, capability and reputation of the
foregoing principals were a substantial inducement for City to enter into this Agreement. Therefore,
the foregoing principals shall be responsible during the term of this Agreement for directing all
activities of Contractor and devoting sufficient time to personally supervise the services hereunder.
For purposes of this Agreement, the foregoing principals may not be replaced nor may their
responsibilities be substantially reduced by Contractor without the express written approval of City.
4.2 Contract Officer. The Contract Officer shall be such person as may be
designated by the City Manager of City. It shall be the Contractor's responsibility to assure that the
Contract Officer is kept informed of the progress of the performance of the services and the
Contractor shall refer any decisions which must be made by City to the Contract Officer. Unless
otherwise specified herein, any approval of City required hereunder shall mean the approval of the
Contract Officer. The Contract Officer shall have authority to sign all documents on behalf of the
City required hereunder to carry out the terms of this Agreement.
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4.3 Prohibition Against Subcontracting or Assignment. The experience,
knowledge, capability and reputation of Contractor,its principals and employees were a substantial
inducement for the City to enter into this Agreement. Therefore, Contractor shall not contract with
any other entity to perform in whole or in part the services required hereunder without the express
written approval of the City. In addition, neither this Agreement nor any interest herein may be
transferred, assigned, conveyed, hypothecated or encumbered voluntarily or by operation of law,
whether for the benefit of creditors or otherwise,without the prior written approval of City. Transfers
restricted hereunder shall include the transfer to any person or group of persons acting in concert
of more than twenty five percent(25%)of the present ownership and/or control of Contractor,taking
all transfers into account on a cumulative basis. In the event of any such unapproved transfer,
including any bankruptcy proceeding, this Agreement shall be void. No approved transfer shall
release the Contractor or any surety of Contractor of any liability hereunder without the express
consent of City.
The City's policy is to encourage the awarding of subcontracts to persons or entities with
offices located within the jurisdictional boundaries of the City of Palm Springs and, if none are
available,to persons or entities with offices located in the Coachella Valley("Local Subcontractors").
Contractor hereby agrees to use good faith efforts to award subcontracts to Local Subcontractors,
if Local Subcontractors are qualified to perform the work required. In requesting for the City to
consent to a subcontract with a person or entity that is not a Local Subcontractor, the Contractor
shall submit evidence to the City that such good faith efforts have been made or that no Local
Subcontractors are qualified to perform the work. Said good faith efforts may be evidenced by
placing advertisements inviting proposals or by sending requests for proposals to selected Local
Subcontractors. The City may consider Contractor's efforts in determining whether it will consent
to a particular subcontractor. Contractor shall keep evidence of such good faith efforts and copies
of all contracts and subcontracts hereunder for the period specified in Section 6.2.
4.4 Independent Contractor. Neither the City nor any of its employees shall have
any control overthe manner,mode or means by which Contractor,its agents or employees,perform
the services required herein, except as otherwise set forth herein. City shall have no voice in the
selection, discharge, supervision or control of Contractor's employees, servants, representatives
or agents, or in fixing their number, compensation or hours of service. Contractor shall perform all
services required herein as an independent contractorof City and shall remain at all times as to City
a wholly independent contractor with only such obligations as are consistent with that role.
Contractor shall not at any time or in any manner represent that it or any of its agents or employees
are agents or employees of City. City shall not in any way or for any purpose become or be
deemed to be a partner of Contractor in its business or otherwise or a joint venturer or a member
of any joint enterprise with Contractor.
5.0 INSURANCE, INDEMNIFICATION AND BONDS
5.1 Insurance. The Contractor shall procure and maintain,at its sole cost and
expense, in a form and content satisfactory to City, during the entire term of this Agreement
including any extension thereof, the following policies of insurance:
(a) Commercial General Liability Insurance. A policy of commercial general
liability insurance written on a per occurrence basis with a combined single limit of a least
$1,000,000 bodily injury and property damage including coverages for contractual liability,
personal injury, independent contractors, broad form property damage, products and
completed operations The General Liability Policy shall name the City of Palm Springs as
an additional insured in accordance with standard ISO additional insured endorsementform
CG2010(1185) or equivalent language. The Commercial General Liability Insurance shall
name the City, its officers, employees and agents as additional insured.
(b) Worker's Compensation Insurance. A policy of worker's
compensation insurance in such amount as will fully comply with the laws of the State of
California and which will include $1,000,000 employer's liability.
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(c) Business Automobile Insurance. A policy of business automobile
liability insurance written on a per occurrence basis with a single limit liability in the amount
of $1,000,000 bodily injury and property damage, Said policy shall include coverage for
owned, non-owned, leased and hired cars.
(d) Additional Insurance. Policies of such other insurance, including
professional liability insurance in a minimal amount of$1,000,000 if contract has
professional liability exposure, as may be required in the Special Requirements.
All of the above policies of insurance shall be primary insurance. The insurer shall waive
all rights of subrogation and contribution it may have againstthe City, its officers, employees and
agents, and their respective insurers. In the event any of said policies of insurance are canceled,
the Contractor shall, prior to the cancellation date, submit new evidence of insurance in
conformance with this Section 5.1 to the Contract Officer. No work or services under this
Agreement shall commence until the Contractor has provided the City with Certificates of Insurance
or appropriate insurance binders evidencing the above insurance coverages and said Certificates
of Insurance or binders are approved by the City.
The contractor agrees that the provisions of this Section 5.1 shall not be construed as
limiting in any way the extent to which the Contractor may be held responsible for the payment of
damages to any persons or property resulting from the Contractor's activities orthe activities of any
person or person for which the Contractor is otherwise responsible.
In the event the Contractor subcontracts any portion of the work in compliance with Section
4.3 of this Agreement the contract between the Contractor and such subcontractor shall require the
subcontractor to maintain the same polices of insurance that the Contractor is required to maintain
pursuant to this Section.
5.2 Indemnification. Contractor agrees to indemnify the City, its officers, agents
and employees against, and will hold and save them and each of them harmless from, any and all
actions,suits,claims,damages to persons or property, losses,costs, penalties,obligations, errors,
omissions or liabilities, (herein"claims or liabilities")that may be asserted or claimed by any person,
firm or entity arising out of or in connection with the negligent performance of the work, operations
or activities of Contractor, its agents, employees, subcontractors, or invitees, provided for herein,
or arising from the negligent acts or omissions of Contractor hereunder,or arising from Contractor's
negligent performance of or failure to perform any term, provision, covenant or condition of this
Agreement,whether or not there is concurrent passive or active negligence on the part of the City,
its officers, agents or employees but excluding such claims or liabilities arising from the sole
negligence or willful misconduct of the City, its officers, agents or employees, who are directly
responsible to the City, and in connection therewith:
(a) Contractor will defend any action or actions filed in connection with
any of said claims or liabilities and will pay all costs and expenses, including legal costs and
attorneys' fees incurred in connection therewith;
(b) Contractorwill promptly pay any judgment rendered against the City,
its officers,agents or employees for any such claims or liabilities arising out of or in connection with
the negligent performance of or failure to perform such work, operations or activities of Contractor
hereunder; and Contractor agrees to save and hold the City, its officers, agents, and employees
harmless therefrom;
(c) In the eventthe City,its officers,agents or employees is made a party
to any action or proceeding filed or prosecuted against Contractor for such damages or other claims
arising out of or in connection with the negligent performance of or failure to perform the work,
operation or activities of Contractor hereunder, Contractor agrees to pay to the City, its officers,
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agents or employees, any and all costs and expenses incurred by the City, its officers, agents or
employees in such action or proceeding, including but not limited to,legal costs and attorneys'fees.
5.3 Performance Bond. Concurrently with execution of this Agreement,
Contractor shall deliver to City a performance bond in the sum of the amount of this Agreement, in
the form provided by the City Clerk, which secures the faithful performance of this Agreement,
unless such requirement is waived by the Contract Officer. The bond shall contain the original
notarized signature of an authorized officer of the surety and affixed thereto shall be a certified and
current copy of his power of attorney. The bond shall be unconditional and remain in force during
the entire term of the Agreement and shall be null and void only if the Contractor promptly and
faithfully performs all terms and conditions of this Agreement.
5.4 Sufficiency of Insurer or Surety. Insurance or bonds required by this
Agreement shall be satisfactory only if issued by companies qualified to do business in California,
rated "A"or better in the most recent edition of Best Rating Guide, The Key Rating Guide or in the
Federal Register, and only if they are of a financial category Class VII or better, unless such
requirements are waived by the City Manager or designee of the City ("City Manager") due to
unique circumstances. In the event the City Manager determines that the work or services to be
performed under this Agreement creates an increased or decreased risk of loss to the City, the
Contractor agrees that the minimum limits of the insurance policies and the performance bond
required by this Section 5 may be changed accordingly upon receipt of written notice from the City
Manager or designee; provided that the Contractor shall have the right to appeal a determination
of increased coverage by the City Manager to the City Council of City within ten(10)days of receipt
of notice from the City Manager.
6.0 REPORTS AND RECORDS
6.1 Reports. Contractor shall periodically prepare and submit to the Contract
Officersuch reports concerning the performance of the services required by this Agreement as the
Contract Officer shall require. Contractor hereby acknowledges that the City is greatly concerned
about the cost of work and services to be performed pursuant to this Agreement. For this reason,
Contractor agrees that if Contractor becomes aware of any facts, circumstances, techniques, or
events that may or will materially increase or decrease the cost of the work or services
contemplated herein or, if Contractor is providing design services, the cost of the project being
designed,Contractor shall promptly notify the Contract Officer of said fact,circumstance,technique
or event and the estimated increased or decreased cost related thereto and, if Contractor is
providing design services,the estimated increased or decreased cost estimate for the project being
designed.
6.2 Records. Contractor shall keep, and require subcontractors to keep, such
books and records as shall be necessary to perform the services required by this Agreement and
enable the Contract Officerto evaluate the performance of such services. The Contract Officer shall
have full and free access to such books and records at all times during normal business hours of
City,including the right to inspect, copy, audit and make records and transcripts from such records.
Such records shall be maintained fora period of three(3)years following completion of the services
hereunder, and the City shall have access to such records in the event any audit is required.
6.3 Ownership of Documents. All drawings, specifications, reports, records,
documents and other materials prepared by Contractor, its employees,subcontractors and agents
in the performance of this Agreement shall be the property of City and shall be delivered to City
upon request of the Contract Officeror upon the termination of this Agreement,and Contractorshall
have no claim for further employment or additional compensation as a result of the exercise by City
of its full rights of ownership of the documents and materials hereunder. Any use of such completed
documents for other projects and/or use of uncompleted documents without specific written
authorization by the Contractor will be at the City's sole risk and without liability to Contractor, and
the City shall indemnify the Contractor for all damages resulting therefrom. Contractor may retain
copies of such documents for its own use. Contractor shall have an unrestricted right to use the
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concepts embodied therein. All subcontractors shall provide for assignment to City of any
documents or materials prepared by them, and in the event Contractor fails to secure such
assignment, Contractor shall indemnify City for all damages resulting therefrom.
6.4 Release of Documents. The drawings, specifications, reports, records,
documents and other materials prepared by Contractor in theperformance of services under this
Agreement shall not be released publicly without the prior written approval of the Contract Officer.
7.0 ENFORCEMENT OF AGREEMENT
7.1 California Law. This Agreement shall be construed and interpreted both as
to validity and to performance of the parties in accordance with the laws of the State of California.
Legal actions concerning any dispute, claim or matter arising out of or in relation to this Agreement
shall be instituted in the Superior Court of the County of Riverside, State of California, or any other
appropriate court in such county, and Contractor covenants and agrees to submit to the personal
jurisdiction of such court in the event of such action.
7.2 Disputes. In the event of any dispute arising under this Agreement, the
injured party shall notify the injuring party in writing of its contentions by submitting a claim therefor.
The injured party shall continue performing its obligations hereunder so long as the injuring party
commences to cure such default within ten (10) days of service of such notice and completes the
cure of such default within forty-five(45) days after service of the notice, or such longer period as
may be permitted by the injured party; provided that if the default is an immediate danger to the
health,safety and general welfare,such immediate action may be necessary. Compliance with the
provisions of this Section shall be a condition precedent to termination of this Agreement for cause
and to any legal action, and such compliance shall not be a waiver of any party's right to take legal
action in the event that the dispute is not cured, provided that nothing herein shall limit City's or the
Contractor's right to terminate this Agreement without cause pursuant to Section 7.8.
7.3 Retention of Funds. Contractor hereby authorizes City to deduct from any
amount payable to Contractor(whether or not arising out of this Agreement) (i) any amounts the
payment of which may be in dispute hereunder or which are necessary to compensate City for any
losses, costs, liabilities, or damages suffered by City, and (ii) all amounts for which City may be
liable to third parties, by reason of Contractor's acts or omissions in performing or failing to perform
Contractor's obligation under this Agreement. In the event that any claim is made by a third party,
the amount or validity of which is disputed by Contractor,or any indebtedness shall exist which shall
appear to be the basis for a claim of lien, City may withhold from any payment due,without liability
for interest because of such withholding, an amount sufficient to cover such claim. The failure of
City to exercise such right to deduct or to withhold shall not, however, affect the obligations of the
Contractor to insure, indemnify, and protect City as elsewhere provided herein.
7.4 Waiver. No delay or omission in the exercise of any right or remedy by a
nondefaulting party on any default shall impair such right or remedy or beconstrued as a waiver.
A party's consent to or approval of any act by the other party requiring the party's consent or
approval shall not be deemed to waive or render unnecessary the other party's consent to or
approval of any subsequent act. Any waiver by either party of any default must be in writing and
shall not be a waiver of any other default concerning the same or any other provision of this
Agreement.
7.5 Rights and Remedies are Cumulative. Except with respect to rights and
remedies expressly declared to be exclusive in this Agreement, the rights and remedies of the
parties are cumulative and the exercise by either party of one or more of such rights orremedies
shall not preclude the exercise by it, at the same or different times, of any other rights or remedies
for the same default or any other default by the other party.
7.6 Legal Action. In addition to any other rights or remedies, either party may
take legal action, in law or in equity,to cure, correct or remedy any default,to recover damages for
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any default, to compel specific performance of this Agreement, to obtain declaratory or injunctive
relief, or to obtain any other remedy consistent with the purposes of this Agreement.
7.7 Termination Prior to Expiration Of Term. This Section shall govern any
termination of this Agreement except as specifically provided in the following Section fortermination
for cause. The City reserves the right to terminate this Agreement at any time, with or without
cause, upon thirty (30) days' written notice to Contractor, except that where termination is due to
the fault of the Contractor,the period of notice may be such shorter time as may be determined by
the Contract Officer. In addition,the Contractor reserves the right to terminate this Agreement at
any time upon,with orwithout cause, upon ninety(90)days'written notice to City,except that where
termination is due to the fault of the City, the period of notice may be such shorter time as the
Contractor may determine. Upon receipt of any notice of termination, Contractor shall immediately
cease all services hereunder except such as may be specifically approved by the Contract Officer.
Except where the Contractor has initiated termination, the Contractor shall be entitled to
compensation for all services rendered prior to the effective date of the notice of termination and
for any services authorized by the Contract Officer thereafter in accordance with theSchedule of
Compensation or such as may be approved by the Contract Officer, except as provided in Section
7.3. In the event the Contractor has initiated termination, the Contractor shall be entitled to
compensation only for the reasonable value of the work product actually produced hereunder. In
the event of termination without cause pursuant to this Section, the terminating party need not
provide the non-terminating party with the opportunity to cure pursuant to Section 7.2.
7.8 Termination for Default of Contractor. If termination is due to the failure of
the Contractor to fulfill its obligations under this Agreement, City may, after compliance with the
provisions of Section 7.2, take over the work and prosecute the same to completion by contract or
otherwise, and the Contractor shall be liable to the extent that the total cost for completion of the
services required hereunder exceeds the compensation herein stipulated (provided that the City
shall use reasonable efforts to mitigate such damages),and City may withhold any payments to the
Contractor for the purpose of set-off or partial payment of the amounts owed the City as previously
stated.
7.9 Attorneys' Fees. If either party to this Agreement is required to initiate or
defend or made a party to any action or proceeding in any way connected with this Agreement,the
prevailing party in such action or proceeding, in addition to any other relief which may be granted,
whether legal or equitable, shall be entitled to reasonable attorney's fees. Attorney's fees shall
include attorney's fees on any appeal, and in addition a party entitled to attorney's fees shall be
entitled to all other reasonable costs for investigating such action,taking depositions and discovery
and all other necessary costs the court allows which are incurred in such litigation. All such fees
shall be deemed to have accrued on commencement of such action and shall be enforceable
whether or not such action is prosecuted to judgment.
7.10 Termination for Default of Citv. If termination is due to the failure of the City
to fulfill its obligations under this Agreement, Contract shall, after compliance with the provisions of
Section 7.2, immediately cease all further actions hereunder.
8.0 CITY OFFICERS AND EMPLOYEES: NON-DISCRIMINATION
8.1 Non-liability of City Officers and Employees. No officeror employee of the
City shall be personally liable to the Contractor, or any successor in interest, in the event of any
default or breach by the City orfor any amount which may become due to the Contractor or to its
successor, or for breach of any obligation of the terms of this Agreement.
8.2 Conflict of Interest. No officer or employee of the City shall have any financial
interest,director indirect, in this Agreement nor shall any such officer or employee participate in any
H:\USERSWIMUnsurance\Davis Graeber contract.wpd
September 20,2001(3:43pm) _g_
decision relating to the Agreement which effects his financial interest or the financial interest of any
corporation, partnership or association in which he is, directly or indirectly, interested, in violation
of any State statute or regulation. The Contractor warrants that it has not paid or given and will not
pay or give any third party any money or other consideration for obtaining this Agreement.
8.3 Covenant Against Discrimination. Contractor covenants that, by and for itself,
its heirs, executors, assigns, and all persons claiming under or through them,that there shall be no
discrimination against or segregation of, any person or group of persons on account of race, color,
creed,religion,sex,marital status,national origin,or ancestry in the performance of this Agreement.
Contractor shall take affirmative action to insure that applicants are employed and that employees
are treated during employment without regard to their race,color,creed, religion,sex, marital status,
national origin, or ancestry.
9.0 MISCELLANEOUS PROVISIONS
9.1 Notice. Any notice, demand, request, document, consent, approval, or
communication either party desires or is required to give to the other party or any other person shall
be in writing and either served personally or sent by prepaid,first-class mail, in the case of the City,
to the City Manager and to the attention of the Contract Officer, CITY OF PALM SPRINGS, P.O.
Box 2743, Palm Springs, California 92263, and in the case of the Contractor, to the person at the
address designated on the execution page of this Agreement. Either party may change its address
by notifying the other party of the change of address in writing. Notice shall be deemed
communicated at the time personally delivered or in seventy-two(72) hours from the time of mailing
if mailed as provided in this Section.
9.2 Interpretation. The terms of this Agreement shall be construed in accordance
with the meaning of the language used and shall not be construed for or against either party by
reason of the authorship of this Agreement or any other rule of construction which might otherwise
apply.
9.3 Integration:Amendment. It is understood that there are no oral agreements
between the parties hereto affecting this Agreement and this Agreement supersedes and cancels
any and all previous negotiations,arrangements,agreements and understandings, if any, between
the parties, and none shall be used to interpret this Agreement. This Agreement may be amended
at any time by the mutual consent of the parties by an instrument in writing.
9.4 Severability. In the event that any one or more of the phrases, sentences,
clauses, paragraphs, or sections contained in this Agreement shall be declared invalid or
unenforceable by a valid judgment or decree of a court of competent jurisdiction, such invalidity or
unenforceability shall not affect any of the remaining phrases, sentences, clauses, paragraphs, or
sections of this Agreement which are hereby declared as severable and shall be interpreted to carry
out the intent of the parties hereunder unless the invalid provision is so material that its invalidity
deprives either party of the basic benefit of their bargain or renders this Agreement meaningless.
9.5 CorporateAuthoriit. The persons executing this Agreement on behalf of the
parties hereto warrant that(i)such party is duly organized and existing, (ii)they are duly authorized
to execute and deliver this Agreement on behalf of said party, (iii) by so executing this Agreement,
such party is formally bound to the provisions of this Agreement, and (iv) the entering into this
Agreement does not violate any provision of any other Agreement to which said party is bound.
(SIGNATURES ON NEXT PAGE)
HAUSERSMWInsuranceWavis Graeber contract wpd
September 20,2001(3:43pm)
AOf
IN WITNESS WHEREOF,the parties have executed and entered into this Agreement as of the date
first written above.
CITY OF PALM SPRINGS,
a municipal corporation
ATTEST:
By:
By: City Manager
City Clerk
APPROVED AS TO FORM: (Check one: _Individual_ Partnership
_ Corporation)
By:
City Attorney CONTRACTOR:
Signature (Notarized)
Peter M. Davis
Print Name &Title
Chief Executive Officer
By: �-L5f,- -
Signature (Notarized)
Martin Davis
Print Name &Title
Chief Financial Officer
Mailing Address:
Corporations require two notarized signatures: One Davis & Graeber Insurance Services, Inc.
from each of the following: A. Chairman of Board,
President, or any Vice President: AND B. Secretary, p,0. Box 40
Assistant Secretary,Treasurer,Assistant Treasurer,or
Chief Financial Officer).
Redlands, CA 92373
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September 20,2001(3 43pm) -10-
/4�i/�
CALIFORNIA ALL PURPOSE ACKNOWLEDGMENT
State of California
County of San Bernardino
On September 21, 2001 before me Shannon Lopez, Notary Public
Personally appeared Peter M. Davis
® personally known to me - OR - e to be the
person(s) whose name(so'dii /are subscribed to the within
Instrument anAacknowledged to me tha he she/they executed
the same in h Is)her/their authorized capacity(+es), and that by
(!*Aier/their signature(s) on the instrument the person(s-), or the
entity upon behalf of which the person(&) acted, executed the
instrument.
SHANNON LOP" WITNESS m hand and official seal.
r, COMM.01285691 n Y
NOiAFY PUBLIC CALIrOPN1A Z'
v SAh AENNAN0INO C
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T.
My Comm Exprtu Dec 21,2004�
OPTIONAL
Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent
reattachment of this form.
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT
L
CORPORATE OFFICER
Chief Executive Officer Contract Services Agreement
Title(s) Title or Type of Document
O 'ARTRfERS �D
AL 15
CT Number of Pages
TRUS�E(S)
ATOR
OTHE
Date of Document
SIGNER IS REPRESENTING:
Davis & Graeber Insurance Services Inc City of Palm Springs
Signer(s) other than Named Above
CALIFORNIA ALL PURPOSE ACKNOWLEDGMENT
State of California
County of San Bernardino
On September 21, 2001 before me Shannon Lopez. Notary Public
Personally appeared Martin Davis
® personally known to me - OR - n p��Y P + t� mP nn +hP h �f-sa#is#aetery evidence to be the
person(s) whose names is subscribed to the within
instrument and acknowledged to me that lie sha4hey executed
the same intfijMie4their authorized capacity(fes), and that by
(fNgiegthair signature(-&) on the instrument the person(-&), or the
entity upon behalf of which the person(s) acted, executed the
instrument.
SHANNONLOPEZ
COMM.N1285691 n v
NOTARY
TNESS my hand and official seal.
SANCOUNTY
a7 ^
V aEPNANOINO CPUBLIC CALIFORNIACALWNTYNTV �
My Comm Experts Dec2],2004
OPTIONAL
Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent
reattachment of this form.
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT
L
CORPORATE OFFICER
Chief Financial Officer Contract Services Agreement
Title(s) Title or Type of Document
HERS
L 15
CT Number of Pages
R
Date of Document
SIGNER IS REPRESENTING:
Davis & Graeber Insurance Services Inc City of Palm Springs
Signer(s) other than Named Above
/4r1/s`
EXHIBIT "A"
SCOPE OF SERVICES
Contractor shall provide Property, Liability and Workers' Compensation Insurance
Brokerage Services per Request for Proposal 01-02, per the Contractor's proposal, and per the
following itemized work items:
A. Working on behalf of the City of Palm Springs,California,Contractor shall solicit insurance
and risk management proposals from qualified carriers and evaluate and recommend the
most effective risk financing programs. Each time there is a renewal of a financing
program, Contractor shall provide City with a copy of all bids, including the name of each
insurance company, amount of each bid and details regarding coverages encompassed
within each bid. Contractor is to evaluate various risk financing strategies, prepare a
written summary of each strategy and make appropriate recommendations. Contractor
shall work with the City staff, as applicable, and shall prepare a project time line, develop
a marketing strategy; make presentations; and implement the program to include
negotiations with carriers and other appropriate parties.
B. The Contractor shall develop project time lines and shall be available according to time
lines coordinated with, and acceptable to, City for planning, review, presentations, and
implementation meeting prior to the expiration date of the policies due for renewal. All
recommendations for coverage shall include comprehensive competitive prices from the
insurance market. Summaries shall include insurance company, price quoted, Best's
ratings, limits, deductibles and any changes in terms and conditions.
C. Contractor shall assist City staff in the development and maintenance of contractual
insurance standards and provide expertise as to the appropriate types and levels of
coverage necessary for proposed contracts.
D. Contractor shall review invoices received from carriers to assess accuracy, initiate billing
activity, resolve accounting differences or discrepancies, and confirm premiums are "net
of commissions".
E. On behalf of the City, Contractor shall issue binders and insurance certificates of
coverage,request endorsements from carriers and issue identification cards for automobile
insurance.
F. Contractor shall analyze insurance market trends and report in advance on the effect the
trends will have on pricing and coverage availability and shall make appropriate
recommendation so that City may take advantage of said trends.
G. Contractor shall provide routine verbal consulting advice on safety and loss control matters
as they relate to the City's risk management program. In addition, Contractor shall carry
out on-site risk assessment inspections of a least one third of the City's facilities annually
and develop and provide training programs to reduce said risks.
H. Within 120 days of contract commencement, Contractor shall advise the City in setting up
an effective comprehensive Employee Safety Incentive Program.
I. Contractor shall maintain frequent contact with claims personnel to follow the progress of
claims management activities, remain abreast of loss development, and assist in resolving
problems/conflicts regarding claims administration issues.
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October 1,2001(]0:32am) -12-
EXHIBIT "A"
SCOPE OF SERVICES
J. At Council's request, Contractorwill perform a complete analysis of City's current Workers'
Compensation Program and report and recommend as to the most effective program for
the City's consideration.
K. Meet with City's Management on a quarterly basis to review overall risk management
program.
L. Act as primary Safety Committee advisor, conduct a review of all safety incidents and
accident reports, attend monthly meetings with City's Safety Committee to discuss incident
trends and solutions and provide training services to City staff related to Risk Management
and Safety Committee issues.
M. Issue quarterly written performance reports to City's Management within 30 days of the
end of each quarter.
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October 1,2001(10:32:an) -13-
EXHIBIT "B°
SPECIAL REQUIREMENTS
The requirement of Section 5.3 for the Performance Bond is hereby waived.
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October 1,2001(10:32am) -14-
EXHIBIT "C"
SCHEDULE OF COMPENSATION
For each year of the Agreement, Contractor shall be paid a flat fee of$52,000. Said fee
shall be paid in quarterly equal installments in October, January, April and July of each year.
Contractor to provide an invoice at least 30 days prior to required payments.
Total compensation is not to exceed $260,000.00.
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October 1,2001(10:32am) -15-
EXHIBIT "D"
SCHEDULE OF PERFORMANCE
The term of this contract is for five years.
Services under this contract shall be provided in a timely fashion so the City has at least
20 working days to review all bids and recommend insurance placements. Specific service time
lines called out in Exhibit"A", Scope of Services, shall be adhered to.
By November 31"of each year, Contractor shall advise City of the major training effort to
be undertaken by Contractor in that contract year.
11AUSERSTontractadmin0avis Graeber contact.wpd
October 1,2001(10:3211n) -16-
RESOLUTION NO.
OF THE CITY COUNCIL OF THE CITY OF PALM
SPRINGS, CALIFORNIA, RATIFYING CANCELLATION
OF THE PROFESSIONAL SERVICES AGREEMENT
WITH AON RISK SERVICES, INC. AND APPROVING A
PROFESSIONAL SERVICES AGREEMENT WITH DAVIS
& GRAEBER INSURANCE SERVICES, INC. FOR A 5
YEAR PERIOD AT$52,000 PER YEAR.
WHEREAS the City of Palm Springs contracted with AON Risk Services, Inc., a
California corporation, on January 5, 2000, to perform services as the City's
Insurance Broker of Record to solicit insurance proposals from qualified carriers
upon renewal of liability, property and workers' compensation insurance policies,
and
WHEREAS the City notified Aon Risk Services, Inc. on August 6, 2001, of the
City's desire to cancel for convenience the Insurance Brokerage Service
Agreement #4144, MO6551, pursuant to Section 7.7 Termination Prior to
Expiration of Term, and
WHEREAS the City of Palm Springs sent a Request for Proposal, RFP 01-02 for
Property, Liability and Workers' Compensation Insurance Brokerage Services on
July 17, 2001, to 43 Insurance Brokers, and
WHEREAS Proposals were received on August 17, 2001, from seven Insurance
Brokers, and Davis and Graeber Insurance Services, Inc. was selected by the
Insurance Broker Selection Committee as the best brokerage firm to meet the
City's needs.
NOW THEREFORE BE IT RESOLVED by the City Council of the City of Palm
Springs, to approve a five year Professional Services Agreement with Davis and
Graeber Insurance Services, Inc. in the amount of $52,000 per year to perform
services as--the City's Insurance Broker of Record to solicit insurance proposals
from qualified carriers upon renewal of insurance coverages.
ADOPTED this 3rd day of October, 2001.
AYES:
NOES:
ABSENT:
ATTEST: CITY OF PALM SPRINGS, CALIFORNIA
By
City Clerk City Manager
REVIEWED &APPROVED AS TO FORM
1444