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01/18/2005 u. o Pension Trustees A(lenda Date: 01/18/2005 Location: Council Chambers - City Hall 0>- j- o Call to Order Approval of Minutes 12-13-2004 Pension Trustee Items 1. Accept the employees listed below into membership in the City of Clearwater's Employees' Pen ion Plan. 2. Rosalie Backus, Customer Service Department, and Neil Sickler, Public Utilities Department, be granted regular pensions under Section(s) 2.393 and 2.397 of the Employees' Pension Plan as approved by the Pension Advisory Committee. 3. Award a contract to PriceWaterhouseCoopers LLP for actuarial services for the Employees' Pension Plan and other related services for the five-year period ending December 31,2009, at a total cost not to exceed $217,500, and that the appropriate officials be authorized to execute same. Other Business Adjourn Pension Trustees Agenda1 /18/2005 Page 1 of 1 ... Q )0 .. u ater Pension Trustee Cover Memorandum Trackina Number: 1,038 Actual Date: 01/18/2005 Subiect / Recommendation: Accept the employees listed below into membership in the City of Clearwater's Employees' Penion Plan. Summary: Pension Elig. Name, Job. Class, & Dept.jDiv. Hire Date Date Karl Wielecki, Planner II/Planning 10/21/04 10/21/04 David Rawley, Parks Service Technician I/Parks & Recreation 11/1/04 11/1/04 Mitchell Moen, Parks Service Technician I/Parks & Rec. 11/1/04 11/1/04 Roy Buss, Parks Service Technician I/Parks & Recreation 11/1/04 11/1/04 Patricia Stephen-Zitouni, City Clerk Special/ORLS 11/1/04 11/1/04 Adriana Topel, Librarian II/Library 11/1/04 11/1/04 Zoltan Hortobagyi, Field Service Rep.jCustomer Service 11/1/04 11/1/04 Angela Fortney, Network Support Tech. I/IT 11/1/04 11/1/04 James Stanley, Communications Technician/General Services 11/1/04 11/1/04 Soney Louvon, Police Cadet/Police 11/1/04 11/1/04 Vincent Montalvo, Police Cadet/Police 11/1/04 11/1/04 Brian Munoz, Police Cadet/Police 11/1/04 11/1/04 David Palek, Network Support Technician I/IT 11/1/04 11/1/04 James Reilly, Police Cadet/Police 11/1/04 11/1/04 Natalia Illica, Police Cadet/Police 11/1/04 11/1/04 Reba Harrison, Police Cadet/Police 11/1/04 11/1/04 Matthew Jackson, Recreation Leader/Parks & Recreation 11/15/04 11/15/04 Josh Hoff, Custodial Worker/Marine & Aviation 10/2/04 11/13/04 * * originally hired as part-time; transferred to full-time and pension eligible as of 11/13/04. Originatina: Human Resources Review ADDroval Cvndie Goudeau 01-03-2005 15:10:51 (t(\SIOfV 1 ffus 100 2. .. .. .. u Pension Trustee Cover Memorandum Trackina Number: 1,037 Actual Date: 01/18/2005 Subiect / Recommendation: Rosalie Backus, Customer Service Department, and Neil Sickler, Public Utilities Department, be granted regular pensions under Section(s) 2.393 and 2.397 of the Employees' Pension Plan as approved by the Pension Advisory Committee. Summary: Rosalie Backus, Customer Service Representative, Customer Service Department, was employed by the City on February 18, 1985, and her pension service credit is effective on August 24, 1989. Her pension will be effective December 1, 2004. Based on an average salary of approximately $32,453 per year over the past five years, the formula for computing regular pensions, and Ms. Backus' selection of the Joint & Survivor Annuity, this pension will approximate $12,968 annually. Neil D. Sickler, Wastewater Collection Superintendent, Public Utilities Department, was employed by the City on May 16, 1977, and his pension service credit is effective on June 18, 1977. His pension will be effective February 1, 2005. Based on an average salary of approximately $55,961 per year over the past five years, the formula for computing regular pensions, and Mr. Sickler's selection of the Joint & Survivor Annuity, this pension will approximate $42,462 annually. These pensions were approved by the Pension Advisory Committee on December 9, 2004. Section 2.393 (p) provides for normal retirement eligibility when a participant has reached age 55 and completed twenty years of credited service, has completed thirty years of credited service, or has reached age 65 and completed ten years of credited service. Ms. Backus qualifies under the age 65 and ten years of service criteria and Mr. Sickler qualifies under the age 55 and twenty years of service criteria. Originatina: Human Resources Review Aooroval Cvndie Goudeau 01-03-2005 15: 12:32 ~s IOf'\ 3 ~ ~. ........... ster Pension Trustee Cover Memorandum ~.........................- -- Trackina Number: 1,061 Actual Date: 01/18/2005 Subiect / Recommendation: Award a contract to PriceWaterhouseCoopers LLP for actuarial services for the Employees' Pension Plan and other related services for the five-year period ending December 31, 2009, at a total cost not to exceed $217,500, and that the appropriate officials be authorized to execute same. Summarv: PriceWaterhouseCoopers LLP was chosen after evaluation of responses to RFP 26-04. The five-member evaluation committee was composed of one Pension Advisory Committee representative, and four management representatives from Finance, Human Resources, and the City Manager's Office. The City of Clearwater will also be contracting separately with PriceWaterhouseCoopers LLP, at a later date, for health and welfare actuarial services as a result of this RFP process. PriceWaterhouseCoopers has performed actuarial services for the Employees' Pension Plan for the past sixteen years. Fees included in the requested "not to exceed" amount include: fixed fees for the annual actuarial report of $21,000 annually for the five-year period; annual pension plan individual benefit statements for a fixed annual fee of $2,500; and actuarial advice to City staff over the five-year period, on an as-needed basis, in the amount of $25,000. Additional funding of $75,000 is included for cost studies, if needed, to determine the impact of any pension plan changes proposed via the collective bargaining process. Funding is available in the Employees' Pension Fund. Originatina: Finance Review Aooroval Jav Ravins 12-27-2004 14:54:52 Maraie Simmons 12-27-2004 15:57:04 Garry Brumback 01-03-2005 16:04: 15 Marcie Simmons 12-27-2004 15:42:56 Cvndie Goudeau 01-04-2005 14:53: 13 Bill Horne 01-03-2005 20:47:45 ~_~~.'_',*"Ii_""I>i>1'~~'i'I'~~"'",;*",",'i'I~,,,m~~ ~'f~3 AGREEMENT This AGREEMENT, made this day of , 2004 by and between the City of Clearwater, Florida (City), P.O. Box 4748, Clearwater, Florida 33758, and PRICEWATERHOUSECOOPERS LLP, 101 East Kennedy Boulevard, Suite 1500, Tampa, Florida 33602, (Consultant), a Florida limited liability partnership. WHEREAS, City issued Request for Proposal No. 26-04 for Actuarial and Other Services to the Clearwater Employees Pension Plan (Plan) (See Exhibit "A"); and WHEREAS, City selected Consultant to provide actuarial and other related services (Project) according to Consultant's response to Request for Proposal No. 26-04 (See Exhibit "B") . NOW THEREFORE, the City and Consultant do hereby incorporate all terms and conditions in Exhibit "A" and Exhibit "B" and mutually agree as follows: 1. SCOPE OF PROJECT. Consultant agrees to provide pension plan actuarial and other related services under the terms and conditions described in Request for Proposal No. 26-04. 2. TIME OF PERFORMANCE. Project will commence on January 1, 2005 and shall terminate on December 31, 2009. 3. REPORTS. Consultant agrees to provide to City reports on the proj ect upon request by the Ci ty and under the terms provided in the Request for Proposal No. 26-04. 4. COMPENSATION. The City will pay Consultant a sum not to exceed $21,000 annually for the annual pension plan actuarial report. City agrees to pay Consultant 50% of the amount due each year upon commencement of the services and 50% upon acceptance by City of the final actuarial report. Additionally the City will pay Consultant a sum not to exceed $2,500 annually for individual pension plan benefit statements. Any additional services related to the Project must be approved by the City Project Manager. The City may, from time to time, request changes in the scope of the proj ect of Consul tant to be performed hereunder. Such changes, including any increase or decrease in the amount of 1 Consul tant' s compensation and changes in the terms of this Agreement which are mutually agreed upon by and between City and Consultant shall be effective when incorporated in written amendment to this Agreement. 5. METHOD OF PAYMENT. Consultant shall bill City according to the paYment schedule, and City agrees to pay after approval by the City proj ect Manager under the terms of the Florida Prompt PaYment Act F. S . 218.70. 6. CONTACTS FOR RESPONSIBILITY. Stephen M. Metz will be designated as Project Director for this project by Consultant to manage and supervise the performance of this Agreement on behalf of Consultant. Associated with the Project Director will be staff members whose experience and qualifications are appropriate for this Project. The City will be represented by William B. Horne, II, or his designee for all matters relating to this Agreement. 7. TERMINATION OF CONTRACT. The City or the Consultant at its sole discretion may terminate this contract by giving the other party sixty (60) days written notice of its election to do so and by specifying the effective date of such termination. The Consultant shall be paid for its services through the effective date of the termination. Further, if Consultant shall fail to fulfill any of its material obligations hereunder, this Agreement shall be in default, the City may terminate the contract, and Consultant shall be paid only for work completed. 8. NON-DISCRIMINATION. There shall be no discrimination against any employee who is employed in the work covered by Consultant, or against applicants for such emplOYment, because of race, religion, color, sex, or national origin. This provision shall include, but not be limited to the following: emplOYment, upgrading, demotion, or transfer; recruitment or recruitment advertising; layoff or termination; rate of payor other forms of compensation; and selection for training, including 2 apprenticeship. 9. INTERESTS OF PARTIES. Consultant covenants that its officers, employees and shareholders have no interest and shall not acquire any interest, direct or indirect, which would conflict in any manner or degree with the performance of services required to be performed under this Agreement. 10. INDEMNIFICATION AND INSURANCE. Subject to Paragraph 14, Consultant agrees to hold the City and its officers, employees and agents free and harmless from and against any and all losses, penalties, damages, settlements, costs, charges, professional fees or other expenses or liabilities of every kind and character arising out of or due to any negligent act or omission of Consultant or its employees in connection with or arising directly or indirectly out of this Agreement and/or the performance hereof. Without limiting its liability under this Agreement, Consultant shall procure and maintain during the life of this Agreement liability insurance coverage as described in Exhibit "A". This provision shall survive the termination of this Agreement. 11. PROPRIETARY MATERIALS. Upon request by City, Consultant shall transfer, assign and make available to City or its representatives all property and materials in Consultant's possession belonging to the City, or originally produced by Consultant as a deliverable hereunder. Consultant may keep such copies of City's property and materials that it deems necessary to comply with professional standards with respect to documentation work performed and/or in accordance with Consultant's document retention policies. 12. GOVERNING LAW. This Agreement shall be governed by the laws of the State of Florida and any dispute involving the enforcement or interpretation of this Agreement shall have its venue in Pinellas County, Florida. In the event that any legal action shall be necessary to 3 enforce the provisions of this Agreement, the prevailing party shall be entitled to all reasonable court costs, including attorneys' fees. 13. WARRANTIES. Consultant warrants that the service provided will be performed and supervised by qualified personnel. Notwithstanding anything to the contrary contained in this agreement, consultant makes no other warranties, express or implied, or whether arising by operation of law, course of performance or dealing, custom, usage in the trade or profession or otherwise, including without limitation implied warranties of merchantability and fitness for a particular purpose. 14. LIMITATION OF LIABILITY. Other than the City's obligations to make payments that are due and owing under this Agreement, a party's and its affiliates' entire and collective liability arising out of or relating to this Agreement, including without limitation on account of performance or nonperformance of obligations hereunder and indemnification under Paragraph 10, regardless of the form of the cause of action, whether in contract, tort (including without limitation negligence), statute, or otherwise, shall in no event exceed the annual fees paid to the Consultant under this Agreement. Notwithstanding anything to the contrary contained in this Agreement, neither party nor its affiliates shall, under any circumstances, be liable to the other party or its affiliates for any claim based upon any third party claim or for any consequential, incidental, indirect, punitive, exemplary or special damages of any nature whatsoever, or for any damages arising out of or in connection with any malfunctions, delays, loss of data, loss of profit, interruption of service or loss of business or anticipatory profits, even if a party or its affiliates have been advised of the likelihood of such damages occurring. No action, regardless of form, arising out of this Agreement may be brought by either party more than one (1) year after the cause of the action has accrued. 4 15. CONFIDENTIALITY. Consultant agrees to take reasonable measures to keep confidential the information provided to Consultant by City (i.e., II Confidential Information") and shall disclose the Confidential Information only to those personnel at Consultant who have a need to know such information, and shall use the Confidential Information solely for the purpose of providing services under this Agreement. Notwithstanding anything to the contrary in this Agreement, Consultant may disclose Confidential Information as may be required by law, statute, rule or regulation, including any subpoena or other similar form of process. Consultant will provide the City with prompt notice of any request that Consultant disclose Confidential Information (so long as such notice is not prohibited by law), so that the City may object to the request and/or seek an appropriate protective order. It is understood and agreed that any objection by the City to such a request shall not affect Consultant's obligations to produce materials called for by appropriate legal process. Upon conclusion of the provision of services under this Agreement, if the City requests in writing, Consultant shall return the Confidential Information to City. Consultant may keep such copies of City's Confidential Information that it deems necessary to comply with professional standards with respect to documentation work performed and/or in accordance with Consultant's document retention policies. Any copies of City's Confidential Information so kept shall be retained and destroyed in accordance with (a) Consultant's standard document retention policies and (b) the terms of this Agreement. Consultant recognizes the confidential and proprietary nature of the Confidential Information and acknowledges that, in the event it is determined by a court that a breach of the confidentiality provisions of this Agreement has occurred or is likely to occur, the City will suffer irreparable harm. Accordingly, the City shall be entitled to seek preliminary and permanent injunctive 5 relief in the event of a breach or threatened breach of this Agreement, as well as all other applicable remedies at law or equity. Consultant's confidentiality obligations under this Agreement will terminate three years from the date set forth below. 16. QUALIFICATIONS. The Actuary certifies that it is technically qualified under state and federal laws and is competent to provide the services required by this Agreement. The Actuary acknowledges that it is fully familiar with the laws of the State of Florida governing public employee retirement systems and with the provisions of the Code of the City of Clearwater relating specifically to the management of this Fund. The Actuary further acknowledges that it has been provided with a copy of the applicable provisions of the City Code. 17. RELATION OF PARTIES. The parties recognize that the Actuary is a fiduciary of the City and the Pension Fund, pursuant to the provisions of Chapter 112, Part VII, Florida Statutes. 18. ENGAGEMENT LIMITATIONS - The services performed under this Agreement will not constitute an examination or review in accordance with generally accepted auditing or attestation standards. Except as may be specified in this Agreement, we will not audit or otherwise verify the information supplied to us, from whatever source, in connection with this engagement. In performing services under this Agreement, we may occasionally discuss financial accounting matters with Client. The services performed under this Agreement, including any such discussions, are not intended to and do not include an engagement or other undertaking to perform an engagement to issue an opinion on the application of financial accounting matters as contemplated under Statement on Auditing Standards (SAS) No. 97. We have no responsibility for such matters unless we are specifically engaged to address these issues pursuant to a specific 6 written engagement agreement. As you are aware, tax returns and other filings are subject to examination by taxing and regulatory authorities. We will be available to assist the Client in the event of an audit of any issue for which we have provided services under this Agreement. However, unless otherwise indicated, our fees for these additional services are not included in our fee for the services covered by this Agreement. We will not be prevented or restricted by anything in this Agreement from providing services for other clients. In the course of our engagement, certain communications between Client and PricewaterhouseCoopers may be subject to a confidentiality privilege. Client recognizes that we may be required to disclose such communications to federal, state and international regulatory bodies; a court in criminal or other civil litigation; or to other Third Parties, including Client's independent auditors, as part of our professional responsibili ties. In the event that we receive a request from a Third Party (including a subpoena, summons or discovery demand in litigation) calling for the production of information, we will promptly notify you. We agree to cooperate with Client in any effort to assert any privilege with respect to such information, provided Client agrees to hold PricewaterhouseCoopers harmless from and be responsible for any costs and expenses resulting from such assertion. 19. OTHER PROVISIONS. If any provision of this Agreement, including the Limitation of Liability clause, is determined to be invalid under any applicable law, such provision will be applied to the maximum extent permitted by applicable law, and shall automatically be deemed amended in a manner consistent with its objectives to the extent necessary to conform to any limitations required under applicable law. 7 IN WITNESS WHEREOF, the City and Consultant have executed this Agreement on the date first above written. Countersigned: Frank V. Hibbard Mayor-Council Member Approved as to form: Leslie Dougall-Sides Assistant City Attorney Witnesses: By: CITY OF CLEARWATER, FLORIDA William B. Horne, II City Manager Attest: Cynthia E. Goudeau City Clerk PriceWaterhouseCoopers By: Attest: 8 Q~ ~ '''') I "<'-nS r () I' .:s CITY OF CLEARWATER, FLORIDA REQUEST FOR PROPOSAL FOR ACTUARIAL AND OTHER SERVICES RFP #26-04 A. INTRODUCTION / BACKGROUND The City of Clearwater (hereinafter "City") is requesting proposals from qualified firms of actuarial consultants interested in providing actuarial and other related services to the City of Clearwater Employees' Pension Plan (hereinafter "Plan"). Actuarial services are also required for the City's other postemployment benefits (OPEB). A Selection Committee (hereafter "Committee") has been formed to facilitate the selection process. The Committee is composed of five (5) City appointees. The Plan, is a single-employer, self-administered defmed benefit pension plan for eligible City employees. Members presently contribute 8.0% of their earnings on a pre-tax basis, while the City contributes the balance required as determined by the actuarial valuation. The Plan requires a minimwn City employer contribution of 7.0% of employee salaries and wages. The Plan includes a disability retirement provision for members who become disabled. The Employees' Pension Plan is governed by the members of the City Council who serve as the Plan Trustees. The City has other postemployment benefits due to the inclusion of retirees in the City's group health insurance and life insurance plans. The City is a city manager/council form of local government, which offers a traditional mix of municipal services to a population of approximately 110,000. The City employs approximately 1,850 persons. The Employee's Pension Plan currently has 1,633 active members and 646 retirees. The Plan assets had a market value of$471 million as of January 1,2004. B. REQUIRED SERVICES AND PERFORMANCE STANDARDS Actuarial Reviews - Pension and Health & Welfare (1) The valuations must be performed in accordance with accepted actuarial principles including the use of appropriate actuarial assumptions. The fmancial infonnation produced must be in accordance with generally accepted accounting principles, including full compliance with Governmental Accounting Standards Board (GASB) statements. The actuarial reports must provide sufficient infonnation to enable the City to make all financial statement note disclosures required by applicable GASB statements. (2) The techniques and assumptions used and the content of the reports issued must conform to the requirements of all applicable laws and rules including Florida Statutes and Chapter 60 of the Florida Administrative Code, and the fee quoted is to include responses by the actuary to inquiries of the State Board of Administration as necessary. (3) Pension and Health & Welfare (OPEB) actuarial studies must be completed on a timely basis in order to meet budgeting requirements, no later than April 1 sl annually. Emplovee Benefit Statements Individual employee benefit statements will be prepared and delivered to the City for distribution to employees. The benefit statements will include such infonnation as projected plan benefits, employee contributions, accrued plan benefits, date of 100% vesting, etc. The statements will be delivered to the City annually by July 1 sl for distribution to employees. Request For Proposal For Actuarial Serviees RFP# 26-04 1 City of Clearwater, Florida Advise to City Staff on Tax and Plan Issues The firm will be available to advise City staff on issues pertaining to tax and plan considerations such as plan design, estimated funding requirements of various alternative plan designs, and detailed actuarial reports and impact statements related to the Employees' Pension Plan. Recognizing that service providers and clients have an on-going need for communications, the service provider will advise the City, in advance, when discussions are such that a billing will occur. Fees will typically be based on a fee per hour, however for large projects a project fee will be negotiated. C. INDEMNIFICATION AND INSURANCE REQUIREMENTS Indemnification The Proposer shall hold harmless, indemnify and defend the City, its elected officials, officers and employees, against any claim, action, lawsuit, loss, damage, injury (whether mental or physical, and include death to persons, or damage to property), liability, cost and expense of whatsoever kind or nature including, but not by way oflimitation, attorney's fees and court costs, caused by negligent acts or omissions of Actuarial Services. The City shall also be held hannless against all claims for financial loss with respect to the provision of or failure to provide professional or other services resulting in professional malpractice, or errors or omissions liability arising out ofperforrnance of the agreement or contract, unless such claims are a result of the city's own negligence. Insurance (1) Without limiting its liability under the contract, the Proposer shall procure and maintain at its sole expense during the life of the contract, insurance of the types and the minimum amounts stated. Type Professional Liability Amount $2,000,000 Comprehensive or Commercial General Liability $500,000 Comprehensive or Business Automobile Liability $500,000 Workers' Compensation Coverage as imposed by State Law $ Statutory Employers Liability $100,000/$100,000/$500,000 (2) The Proposer's comprehensive general liability policy shall include contractual liability on a blanket or specific basis to cover this indemnification. (3) Such insurance shall be written by a company or companies licensed to do business in the State of Florida and satisfactory to the City. Prior to commencing any work under this contract, certificates evidencing the maintenance of said insurance shall be furnished to and approved by the City's Risk Management Division. (4) The insurance coverage's and conditions required shall not be suspended, voided, cancelled or modified except after thirty (30) days prior written notice has been given by certified mail, return receipt requested, to the City's Risk Management Division Office. (5) The City may, at its option, require a copy of the Proposer's insurance policies. Request For Proposal For Actuarial Services RFP# 26-04 2 City of Clearwater, Florida (6) All insurance policies required within this RFP and any contract subsequently entered into between the parties shall provide full coverage from the first dollar of exposure unless otherwise stipulated. No deductibles or self-insurance retention will be accepted without prior approval from the City. The Proposer's deductible/self-insurance retention's (SIRs) shall be disclosed to the City and may be disapproved by the City. They shall be reduced or eliminated at the option of the City. The Proposer is responsible for the amount of any deductible or SIR. (7) Except for workers' compensation and professional liability insurance, the Proposer's insurance policies shall be endorsed to name the City as an additional insured to the extent of the city's interest. (8) Insurance required of the Proposer or any other insurance carried by the Proposer shall be considered primary and any insurance of the City shall be considered excess as may be applicable to claims under any contract or agreement between City and Proposer. (9) Any party providing services or products to the City will be expected to enter into a written agreement, contract, or purchase order with the City that, incorporates, either in writing or by reference, all of the pertinent provisions relating to insurance and insurance requirements as contained herein. A failure to do so, may, at the sole discretion of the City, disqualify any party from performing services or selling products to the city provided, however, the City reserves the right to waive any such requirement. (10) If a claims made form of professional liability coverage is provided, the retroactive date of coverage shall be no later than the inception date of claims made coverage, unless prior policy was extended indefInitely to cover prior acts. Coverage shall be extended beyond the policy year either by a supplemental' extended reporting period (ERP) of as great duration as available, and with no less coverage and with reinstated aggregate limits, or by requiring that any new policy provide a retroactive date no later than the inception date of claims made coverage. D. RFP TIME TABLE The anticipated schedule for the RFP and contract approval is as follows: RFP available for distribution Friday, August 6, 2004 Deadline for receipt of questions VVednesday,August25,2004 Deadline for receipt of proposals Monday, September 13, 2004, 4:00p.m. Review of proposals & select candidates for presentations Tuesday, September 21,2004 Presentations & Final Ranking VVednesday, September 29,2004 City begins contract negotiations Thursday, September 30, 2004 Recommendation to Pension Trustees Monday, November 15, 2004 Projected Contract award and start date January 1, 2005 E. RFP AVAILABILITY Copies of the RFP are available by contacting George McKibben at (727) 562-4634, or by visiting the Purchasing Division located at the Municipal Services Building, 3rd Floor/Finance, 100 South Myrtle Avenue, Clearwater, Florida 33756-5520. Request For Proposal For Actuarial Services RFP# 2~4 3 City of Clearwater, Florida F. PROPOSAL SUBMISSION One original and five copies (a total of six) shall be delivered to the City of Clearwater, Purchasing Manager, 100 South Myrtle Avenue, Clearwater, FL 33756-5520, prior to the opening time of 4:00 p.m, EDT, on Monday, September 13, 2004. Proposals shall be as brief and to the point as possible while still meeting proposal requirements. The delivery of proposals to the City of Clearwater Purchasing Office prior to the specified date and time is solely and strictly the responsibility of the proposing firm. The City shall not, under any circumstances, be responsible for delays caused by the United States Postal Service or any private delivery service, or for other delays. All responses must be manually and duly signed by an authorized authority to bind said firm, and Proposer(s) must affix their company's corporate seal to the Proposal. In the absence of a corporate seal, the Proposal must be notarized by a Notary Public. The submittal of a proposal by a preparer will be considered by the City as constituting an offer by the Proposer to perform the required services at the stated fees. The stated fees shall be considered locked in for 180 days from the time of receipt. All responses must be marked on the outside: "Request For Proposal For Actuarial Services for the City of Clearwater, Florida RFP 26-04 To be opened at 4:00 PM, EDT, September 13th, 2004." Each Proposer is solely responsible for reading and completely understanding the requirements of this RFP. The opening time shall be and must be scrupulously observed. Under no circumstances will proposals delivered after the specified delivery time be considered. Late submissions shall be returned unopened to the firm with the notation "The Proposal was received after the delivery time designated for the receipt and opening of the proposals." G. INQUIRIES AND ADDENDA Each firm shall examine all RFP documents and shall judge all matters relating to the adequacy and accuracy of such documents. Any inquiries, suggestions or requests concerning interpretation, clarification, or additional information pertaining to the RFP shall be made in writing a minimum of five (5) working days prior to due date through the City of Clearwater's Purchasing Manager, George McKibben, at P.O. Box 4748, Clearwater, FL 33758-4748; or FAX 727-562-4635. Facsimiles must have a cover sheet which shall include, at a minimum, the Proposer's name, address, number of pages transmitted, phone nwnber, and facsimile nwnber. The City shall not be responsible for oral interpretations given by any City employee, representative, or others. The issuance of a written addendwn is the only official method whereby interpretation, clarification, or additional information may be given. If any addenda are issued to this RFP, the City will attempt to notify all prospective firms who have secured same. However, it shall be the responsibility of each firm, prior to submitting the proposal, to contact the City of Clearwater's Purchasing Manager (727-562-4634) to determine if addenda were issued and to make such addenda a part of the proposal. Request For Proposal For Actuarial Services RFP# 26-04 4 City of Clearwater, Florida H. NO CORRECTIONS Once a competitive proposal is submitted, the City shall not accept any request by any proposer to correct errors or omissions in any calculations or competitive price submitted I. INFORMALITY W AlVER/REJECTION OF BIDS The City reserves the right to reject any or all responses and to waive any irregularity, variance or informality whether technical or substantial in nature, in keeping with the best interests of the City. J. APPROPRIATIONS CLAUSE The City, as an entity of government, is subject to the appropriation of funds by its legislative body in an amount sufficient to allow continuation of its performance in accordance with the terms and conditions of this contract for each and every fiscal year following the fiscal year in which this contract shall remain in effect. Upon notice that sufficient funds are not available in the subsequent fiscal years, the City shall therefore be released of all terms and other conditions. K. ORAL PRESENTATION A formal oral presentation may be required by each fmn that is selected during the initial review process (at the sole option of the City). If required, presentations should be in support of the fmn's proposal or to exhibit or otherwise demonstrate the information contained therein. If the Connmttee wishes additional clarification of any information or additional information, any of the finns may be requested to submit that information in writing. L. EXCEPTION TO THE RFP Proposers may take exceptions to any of the terms of this RFP unless the RFP specifically states where exceptions may not be taken. Should a Proposer take exception where none is permitted, the proposal will be rejected as non- responsive. All exceptions taken must be specific, and the Proposer must indicate clearly what alternative is being offered to allow the City a meaningful opportunity to evaluate and rank proposals. Where exceptions are permitted, the City shall determine the acceptability of the proposed exceptions and the proposals will be evaluated based on the proposals as submitted. The City, after completing evaluations, may accept or reject the exceptions. Where exceptions are rejected, the City may request that the Proposer furnish the services or goods described herein, or negotiate an acceptable alternative. M. OPENNESS OF PROCUREMENT PROCESS Written competitive proposals, other submissions, correspondence, and all records made thereof, as well as negotiations conducted pursuant to this RFP, shall be handled in compliance with Chapters 119 and 286 Florida Statutes. The City gives no assurance as to the confidentiality of any proposal once submitted. Request For Proposal For Actuarial Services RFP# 26-04 5 City of Clearwater, Florida N. QUALIFICATIONS AND OTHER FACTUAL INFORMATION (1) Firm Qualifications A. Indicate size of fmn, organizational structure, location of management and charter authorization and licenses to do business in the State of Florida. B. Describe in general your firm's national, statewide and local service capabilities to perform the required services as stated in Section B of this RFP. C. Describe resources available to your fIrm such as computer capability, personnel with specialized knowledge, and expertise in the governmental fIeld. D. Describe your fIrm's experience in serving as an actuary and consultant to local governmental units including your most recent clients within the State of Florida, including the names, addresses, and phone numbers of contact persons; briefly describe the services performed for these clients. E. Describe your fIrm's experience specifIc to health & welfare actuarial valuations related to other postemployment benefIts. F. Indicate whether your fIrm qualifIes as an "Emolled Actuary" as defmed in Chapter 60T-I.002(6) of the Florida Administrative Code. G. Please provide information on litigation your fIrm has been a party to during the past three (3) years. (2) Familiarity with GASH Statement Requirements Please indicate your familiarity with GASB Statement reporting and disclosure requirements relating to pension plans and other postemployment benefIts by providing a brief sununary of current and proposed requirements and your experience in providing required disclosures. (3) Qualifications of Personnel to be Assigned Provide reswnes of the personnel who would be directly involved in performing actuarial and consulting services for the City, including but not limited to: (i) Formal and supplemental education; (ii) Experience in performing pension and health & welfare actuarial services and consultation regarding employee benefIt programs including governmental client names where possible; (iii) Knowledge of State of Florida regulatory requirements applying to municipal pension plans; (iv) Experience, if any, in performing valuations in compliance with GASB Statements. (v) Memberships in professional organizations; and (vi) Professional recognition and awards. Request For Proposal For Actuarial Services RFP# 26-04 6 City of Clearwater, Florida (4) Costs to Provide the Various Services A. Provide full information on the cost for each of the required services identified in Section B of the RFP including whether the fee is on a project basis or hourly basis, the estimated number of hours and total cost, and any other costs which would be reasonable expected to be incurred as a result of the performance of the service. If applicable, please provide any project or hourly cost increases for years two thru five of the anticipated five-year contract. Costs should be quoted on each service as follows: . Annual Pension Actuarial Review (project basis) . Annual Health & Welfare Actuarial Review - OPEB (project basis) . Annual Employee Benefit Statements (project basis) . Advise to City Staff on Tax and Plan Issues (hourly basis) O. NEGOTIATIONS The City may award a contract on the basis of initial offers received, without further negotiations, or may negotiate a fmal contract. Therefore, each initial offer should contain the Proposer's best terms from a cost or price and technical standpoint. The City reserves the right to enter into contract negotiations with the selected Proposer. If the City and the selected Proposer cannot negotiate a successful contract, the City may terminate said negotiations and begin negotiations with the next selected Proposer. This process will continue until a contract has been executed or all Proposers have been rejected. No Proposer shall have any rights against the City arising from such negotiations. P. RIGHT TO PROTEST Any actual or prospective Proposer who is aggrieved in connection with the solicitation or award of a contract may seek resolution of its complaints by contacting the Purchasing Manager. Q. NO COLLUSION By offering a submission to the RFP, the proposer certifies the proposer has not divulged to, discussed or compared his/her competitive proposal with other proposers and has not colluded with any other proposers or parties to this competitive proposal whatsoever. R. EVALUATION CRITERIA AND RANKING PROCESS GENERAL The evaluation and ranking of all competitive proposals received shall be accomplished utilizing the criteria described in this Section. Information and data included in the Actuarial Services proposal shall be considered in the evaluation and ranking process. SELECTION CRITERIA All proposals shall be equally evaluated with respect to the completeness of the data provided, support for all claims made, and the overall approach taken. The following criteria shall be utilized in the evaluation of the proposal: 30% 20% 20% 20% 10% (1) Firm Qualifications (2) Familiarity with GASB Statement Requirements (3) Qualifications of Personnel to be Assigned (4) Costs to Provide the Various Services (5) References References may be called regarding the level of satisfaction with services rendered by the proposing firm, technical ability, cost, and education of and presentation to governing bodies. Request For Proposal For Actuarial Serviees RFP# 26-04 7 City of Clearwater, Florida STATEMENT OF NO BID Note: If you do not intend to respond to this bid request, please complete and return this sheet to: City of Clearwater Purchasing Department P.O. Box 4748 Clearwater, FL 33758-4748 We, the undersigned, have declined to bid on the above noted Invitation for Bid for the following reason(s): Insufficient time to respond to Request for Proposal. Do not offer this product/service. Our schedule will not permit us to perform. Unable to meet specifications. Unable to meet insurance requirements. Specifications unclear (please explain below). Remove us from your "Bidder Mailing List". Other (please explain below). Remarks: We understand that if a "no bid" statement is not returned, our name may be removed from the Bidder's List of the City of Clearwater. Company Name: Address: City, State, Zip: Telephone: Date: Signature: Request For Proposal For Actuarial Services RFP# 26-04 8 City of Clearwater, Florida Request for Proposal for Actuarial Services For the City of Clearwater, Florida RFP 26-04 To be opened at 4:00 PM, EDT September 13th, 2004 CONTENTS PAGE Firm Qualifications 1 Familiarity with GASH Statement Requirements 11 Qualifications of Personnel to be Assigned 12 Costs to Provide the Various Services 17 PricewaterhouseCoopers LLP FIRM QUALIFICATIONS A. Indicate size of firm, organizational structure, location of management and charter authorization and licenses to do business in the State of Florida. PricewaterhouseCoopers LLP (www.pwcgloba1.com). the world's largest professional services organization, helps its clients build value, manage risk and improve their performance. Drawing on the talents of more than 125,000 people in 139 countries, we provide a full range of business advisory services to leading global, national and local companies and to public institutions. These services include audit, accounting and tax advice; human resource consulting; financial advisory services including mergers and acquisitions, business recovery, project finance and litigation support; business process outsourcing services; and legal services through a global network of affiliated law firms. We have a global network of over 5,000 human resource practitioners in 60 countries which provide HR services to a wide range of companies. Our U.S. HRS practice includes over 1,500 practitioners working in the human resource services area - including actuaries, accountants, tax specialists, financial advisors, and other human resource professionals with a wide range of knowledge in areas such as compliance, retirement, healthcare delivery, compensation, estate planning, learning and education, and HR effectiveness. Our Southeast HRS practice consists of over 200 professionals assisting companies with their human resource needs. PricewaterhouseCoopers refers to the US firm of PricewaterhouseCoopers LLP and other members of the worldwide PricewaterhouseCoopers organization. PricewaterhouseCoopers was formed on July 1, 1998 through the global merger of Coopers & Lybrand and Price Waterhouse, bringing together the legacies and capabilities of these two world class firms. In the U.S., we serve clients through offices of PricewaterhouseCoopers LLP, a limited liability partnership. In Florida, we have offices III Tampa, Orlando, Jacksonville, Miami, Fort Lauderdale, and West Palm Beach. PricewaterhouseCoopers, including its predecessor firm in Florida, has been a legal entity providing continuous services in the State for over 60 years. Our Florida practice is registered with the State of Florida Department of Regulation under the provision or Florida Statutes Chapter 473, under license #AD-000I0-878. PricewaterhouseCoopers LLP Through the resources and capabilities of the fIrm's Human Resource Solutions group, PricewaterhouseCoopers has one of the world's largest professional practices in actuarial science and employee benefIt plan design and administration and human resource consulting. Over the past several years, as the human resources industry has continued to consolidate, PwC has expanded the size, geographic reach and service capabilities of the HR consulting organization. B. Describe in general your firm's national, statewide and local service capabilities to perform the required services as stated in Section B of this RFP. We have been providing the pension-related services requested in the RFP for the past 16 years and will maintain the same engagement team that has been serving the City of Clearwater most recently, led by Steve Metz, who has served as your actuary from the beginning. We have added to the engagement team people with specific expertise in retiree medical valuations and the implementation of GASB Statement 45. Our HRS practice nationally includes over 1,500 actuaries, attorneys and consultants. Our Southeast region includes over 200 professionals. Steve Metz, the engagement partner for the City of Clearwater is the partner in charge of the Southeast Region Retirement Practice. Our Florida actuarial clients include: The City of Clearwater Blue Cross/Blue Shield of Florida The PGA Tour Carnival Cruise Lines University Community Hospital- Tampa Helen Ellis Memorial Hospital The Martin County School Board Bayfront Medical Center Jackson Memorial Hospital- Miami The Miami Department of Off-Street Parking Martin Memorial Health System Munroe Regional Medical Center PricewaterhouseCoopers brings the full resources of our firm's assurance and business advisory, tax and legal services as well as a wide range of consulting resources. We bring to employee benefit consulting matters an interdisciplinary approach that goes well beyond the customary scope of benefit consulting services. Plans PwC can help you design, build and run the proper programs for your organization. HR plans and programs - including benefits and total compensation - are central to your organization's ability to attract and retain superior employee talent. PwC teams with your staff to provide technical advice combined with practical and creative support in the design, structure and financing of the PricewaterhouseCoopers LLP 2 People PricewaterhouseCoopers LLP right programs to drive your people strategies. To meet these challenges, we draw on our creativity and our expertise in: Actuarial and other Financial Services design, implementation and administration of defmed benefit and defmed contribution retirement plans Total Rewards Program Design - ways to cut a company's fixed benefit costs, while increasing the value provided to employees when the company hits or exceeds its performance target Health and Welfare Plan Consulting - design, development and assistance in choosing health and welfare programs, including claims, plan utilization, workers' compensation and loss reserve analyses, casualty claims audits and integrated disability management Compliance Services - information about current legislation and its impact on your organization PwC creates customized strategies that address the needs of your organization and your employees. An organization's people strategy directly affects fundamental business issues, such as productivity, profitability and innovation. The ability to attract, manage, motivate and reward human resources creates a critical advantage. We can help your organization develop strategies to successfully drive the behaviors and actions of your employees. Working from an original and appropriate HR strategy, we provide customized solutions along with the methods and resources to help you achieve your goals. Our groundbreaking work in this area draws upon a range of disciplines: Learning and Change - development of leadership competencies, alignment of proper strategies and implementation of appropriate training Communication - the key to employee appreciation and understanding Organizational Effectiveness & Development - strategic planning and management, development of managerial capabilities and establishment of a work environment that attracts and utilizes a diverse workforce Compensation - recruiting, retention and performance management Diversity and W orkILife Programs - developing awareness of the need for a diverse workforce and maintaining balance between work and life commitments 3 Processes PwC can help you run your operations efficiently Does the management, organization and structure of your HR activities add value to your business? By collaborating with you, we can measure the value generated by your company's current HR processes and identify opportunities for change and improvement. We help you to create a clear, compelling business case to gain management's approval for any investment required. We can also help you to construct a realistic plan to guide implementation. Our approach encompasses: Strategy - a review of what HR needs to do and why Business Process Reengineering - how to improve workflow and efficiency Implementation - the who, what and where of improving administration Operation - the system of continuous improvement Merger and Acquisition Support - due diligence on assets, Liabilities C. Describe resources available to your firm such as computer capability, personnel with specialized knowledge and expertise in the governmental field. Computer Capabilities The fIrm's actuarial valuation system is ProVal@. We lease ProVal from Wink:levoss Consultants, Inc., whose staff of actuaries and programmers are dedicated to keeping the system up-to-date with regard to all legislative, methodological and technological changes. As the largest client of Winklevoss, the fIrm is a member of the Pro V al user group and has been a driving force behind a number of upgrades to the valuation and projection systems. ProVal is used for the valuation of pension and postretirement medical plans, developing plan liabilities as well as full valuation results under ERISA funding rules and all applicable F ASB and GASB standards. Pro V al also has extensive deterministic and stochastic projection capabilities, including the ability to perform asset allocation studies. Pro V al is a PC-based system, eliminating much of the time and expense associated with large mainframe systems. Determining the effects of future plan and economic changes on funding, accounting, or cash flow requirements can be performed quickly and efficiently.. Because of the flexible design of ProVal and its extensive capabilities with regard to data handling and the coding of plan provisions and future plan or economic changes, it is uniquely capable of handling extremely complex plan designs and forecasting requests. PricewaterhouseCoopers LLP 4 Our firm maintains a number of internally developed programs that link with ProVal in order to provide an efficient process from data to report. ProVal's reporting and graphing tools allow for many report exhibits to come directly from Pro Val, with great design flexibility to suit individual client needs. In addition, PwC has developed specialized active employee and retiree specific health systems to help with modeling plan changes and pricing. Specifically, our most recent developments include Consumer Directed Healthcare Model, Retiree Medical and Dental Manual, and Medicare Prescription Drug Savings Model. Internal Resources Our consulting practice is supported by our National Technical Consulting Unit in Washington, D.C., a key resource for research as well as up-to-date information on legislative and regulatory activities. The National Technical Services Unit sends out technical memoranda to our practice offices daily via our intranet - The Knowledge Curve. This unit also acts as our liaison with government agencies to obtain information through key contacts and to obtain formal rulings. Our Accounting, Auditing, and SEC Consulting Services Directorate and Tax Directorate also maintain research units. Specialists in these groups bring their expertise to emerging issues. Our work on the Financial Executives Research Foundation Research Project and the FEI Field Test on post-retirement benefits are specific examples of these multidisciplinary research units working together. This extensive work required the involvement of group and pension actuaries, health care and benefits consultants, and accounting and tax professionals from both practice offices and research units. More recently, the research units have been analyzing the impact of the proposed change in accounting treatment of stock based compensation. Keeping our consultants informed on emerging issues, legislative changes and research results is a top priority for us and at the core of our high-quality, responsive service. We get the information out quickly so your team can help you respond before there is a negative impact on your business. And, with our contacts in Washington, D.C., and representation on various committees, the City can be confident that the information is accurate and timely. The Firm's HRS practice also uses a wide variety of communication vehicles to disseminate technical information and the related business issues to our consultants across the country on a timely basis. These communication methods include: . The Knowledge Curve - our Intranet - as well as specialized data libraries on our Lotus Notes servers. These are core resources we use to keep current with information in the office or on the road, using worldwide dial- up capability. The Knowledge Network provides our professionals with PricewaterhouseCoopers LLP 5 access to firmwide discussion groups, your engagement team learns about current developments and is able to exchange ideas with PwC professional across the country. . Monthly national conference calls and several annual national meetings are held to share technical opinions and creative solutions to client problems as well as to discuss ways to meet new client service needs. . We also offer an internet service to our clients, The Tax News Network. This on-line service includes ongoing analysis and information about national benefits legislation and regulations. The Tax News Network is on the World Wide Web at www.taxnews.com. D. Describe your firm's experience in serving as an actuary and consultant to local governmental units including your most recent clients within the State of Florida, including the names, addresses, and phone numbers of contact persons; briefly describe the services performed for these clients. Governmental employers must address challenges different from those of private companies. In most cases, this includes a larger, more diverse work force and separate and distinct compliance issues, among others. Governmental employers in Florida must also comply with Chapter 112 of Florida Statutes, which contains specific funding requirements for pension plans. We would like to point out our extensive experience with governmental clients in Florida. We have worked extensively with government clients, including several government owned hospitals and health systems. PricewaterhouseCoopers LLP 6 Most specifically, we have served as actuaries and consultants to the City of Clearwater for the past 16 years and we are proud of our track record of service. Examples of our assistance to the City include the following: . We worked closely with City staff in developing a revised pension ordinance effective January 1, 1996 subject to collective bargaining. This process required frequent and difficult efforts on short notice. We also worked at the side of City staff to ensure that an agreement was reached with the collective bargaining units without subjecting the City to excessive cost or risk of future cost increases. We received commendations from several members of the City's staff following the completion of the process. . Our actuarial valuation reports for the City have always been accepted without challenge by the State Division of Retirement and we continue to guarantee a State-accepted report. · We have assisted the City in developing creative actuarial methods and techniques to make its pension plan costs more manageable. These include developing an asset averaging approach and establishing a credit balance for the City contributions above those required by State law. The result of these changes has been to greatly reduce the volatility of the City's funding requirements, stabilizing its cost for several years. · We believe that the City currently enjoys an enviable position relative to many Florida cities with regard to the funded status of its pension plan and its financial impact. This is primarily due to very thoughtful decisions made by City management and leadership, but we are proud to have assisted in this result. . We've worked closely with the City's HR and Finance groups as well as its ERISA counsel to evaluate numerous proposed plan changes through the years. · We assisted the City in responding to the Snair lawsuit as well as a number of other pension and retirement issues. We are also proud of the services we've provided to other clients, both in Florida and around the world. We encourage you to contact these actuarial clients regarding the quality and responsiveness of our service. City of Clearwater Actuarial valuations, employee benefit statements, plan design and consulting, plan experience studies 100 S. Myrtle Avenue Clearwater, FL 34618-4748 Ms. Margaret Simmons, Finance Director Margie.simmons@myclearwater.com (727) 562-4530 PricewaterhouseCoopers LLP 7 Jackson Memorial Hospital Actuarial valuations, employee benefit statements, plan design and consulting, plan experience studies 1611 N.W. 12th Avenue Park Plaza West, Room L-306 Miami, FL 33136-1096 Ms. Cynthia Sinclair, Director of Human Resources (305) 585-7265 csinclair@um-jrnh.org Ms. Trummell Valdera, Senior Vice President and Chief Human Resources Officer tvaldera@um-jrnh.org (305) 585-7123 Miami Department of Off-Street Parking Actuarial valuations, employee benefit statements, plan design and consulting, benefit calculations, plan experience studies 190 N.E. 3rd Street Miami, FL 33132 Mr. Albert Manduca, Chief Financial Officer (305) 373-6789 Blue Cross/Blue Shield Of Florida Retiree medical actuarial valuations, plan design and consulting 4800 Deerwood Campus Parkway Jacksonville, FL 32246 Ms. Deanna McDonald, Vice President, Chief Accounting Officer Deanna.mcdonald@bcbsfl.com (904) 905-4095 Auburn University GASB Statement 45 retiree medical valuation 126 Ingram Hall Auburn University, AL 36849 Marcie C. Smith Assistant Vice President for Business & Finance/Controller (334) 844-5588 PricewaterhouseCoopers LLP 8 Wake County, North Carolina GASB Statement 45 retiree medical valuation 336 Fayetteville St Mall 9th Floor Raleigh, NC 27602 Kate George, CPA, ARM Risk Manager (919) 856-6137 Our recent and past experience with Florida governmental pension plans also includes work for the Martin County School Board, the Monroe County School Board, the Florida League of Cities, the City of Fort Lauderdale, FRS, Sarasota Memorial Hospital and others. We will be happy to provide additional references upon request. E. Describe your firm's experience specific to health & welfare actuarial valuations related to other postemployment benefits. One of the two Firms that merged to create PwC - Coopers & Lybrand - was the clear leader in the field of actuarial measurement of retiree medical liabilities. When the Financial Accounting Standards Board issued F ASB Statement No. 106 we were the authors of several studies that literally "wrote the book" in this area - for groups such as the Financial Executive Institute and the National Association of College and University Business Officers. To this day we maintain a prestigious client base in this area. We have also performed numerous actuarial valuations under the new GASB standards. Some of our current retiree medical actuarial valuation clients include: Auburn University (GASB 45 retiree medical valuation) Wake County, North Carolina (GASB 45 retiree medical valuation) State of Alabama (GASB 45 retiree medical valuation) Blue Cross/Blue Shield of Florida Shands-Jacksonville Stetson University - Deland, Florida Bayfront Medical Center - St. Petersburg, Florida Sumter Electric Cooperative - Sumterville, Florida References for several of the clients listed above are provided in the previous section. The clients noted above are only a few of our retiree medical actuarial clients. We will be happy to provide additional references if desired. F. Indicate whether your firm qualifies as an "Enrolled Actuary" as defined in Chapter 60T-I002(6) of the Florida Administrative Code. PricewaterhouseCoopers qualifies as an "Enrolled Actuary" under the definition of the Florida Administrative Code and has been actively serving in this capacity since 1985. PricewaterhouseCoopers LLP 9 G. Please provide information on litigation your firm has been a party to during the past three years. The increase in litigation experience by the business community over the past several years affects all professional services ftrms. PricewaterhouseCoopers and our competitors must expend signiftcant amounts of time and capital refuting an increasing number of unwarranted claims for alleged professional malpractice. Consistent with the experience of other major ftrms, our Firm or its predecessor ftrms, Coopers & Lybrand L.L.P. and Price Waterhouse L.L.P. have been named as a defendant in numerous civil actions. Many of these are merely attempts by investors to recoup losses from third-party sources. Others are attempts to shift responsibility for management fraud and deception to the accounting profession. We believe our Firm has adequate defenses to the lawsuits in which it is named. PricewaterhouseCoopers LLP 10 FAMILIARITY WITH GASH STATEMENT REQUIREMENTS Please indicate your familiarity with GASB Statement reporting and disclosure requirements relating to pension plans and other postemployment benefits by providing a brief summary of current and proposed requirements and your experience in providing required disclosures. PricewaterhouseCoopers has an extensive knowledge of GASB requirements as well as experience working with governmental units in Florida and throughout the country in the implementation of GASB statements. Our knowledge extends throughout our human resources, business assurance and tax and legal services practice, including all aspects of the GASB' s requirements. Most importantly, as the City of Clearwater's actuaries, we assisted in the implementation of GASB 25 and 27. We have also assisted several other government entities in evaluating the impact of GASB Statement 45. The three clients referenced in this proposal - Auburn University, Wake County and the state of Alabama - were all served by the engagement team that will serve the City of Clearwater. As the largest of the Big Four accounting firms, PricewaterhouseCoopers LLP has extensive experience in auditing governmental entities and assisting our clients with required disclosures. Supporting this business assurance practice, we put extensive resources in keeping current on GASB, F ASB, FEI, SEC, AICP A and FICP A as well as other regulatory and oversight bodies that affect our clients' financial statements. Further detail on our experience with the reporting and disclosure requirements can be found in the responses to questions D and E in the Firm Qualifications section. PricewaterhouseCoopers LLP 11 QUALIFICATIONS OF PERSONNEL TO BE ASSIGNED The right people - the most advanced techniques in the world will not help if we do not have the right people to employ them. That is why we have taken care in choosing the PricewaterhouseCoopers team for you. We are sensitive to your need for cost-effective service, a broad range of capabilities, a business orientation and, most essentially, the people skills without which no professional relationship can succeed. Your PricewaterhouseCoopers team has all these attributes. We depend upon the skills and experience of our professional staff to deliver the high quality of service described in this proposal. The commitment of our Firm to anticipate and meet the needs of the City of Clearwater has been demonstrated through our thirteen-year track record of services and continues through our commitment of partners and consultants to this engagement. Steve Metz Engagement Partner Actuary Charles Y ovino Legal & Compliance Consulting Jim Burke Engagement Manager Elliott Cobin Retitree Medical Actuary Defined Benefit Staff The following pages include resumes of the designated staff. PricewaterhouseCoopers LLP 12 STEPHEN M. METZ Human Resource Solutions Principal Partner-in-charge, Southeast Retirement Practice PricewaterhouseCoopers LLP Professional Experience Steve Metz is the partner in charge of the Southeast Retirement practice of the Human Resource Solutions line of business. He is a pension actuary with more than 20 years of experience in human resource consulting and employee benefits. His experience includes employee benefits plan design, funding and administration, and he consults with clients in all areas of compensation and benefits. Mr. Metz has lead numerous compensation and benefits engagements for employers in Florida including compensation and benefits surveys, employee communications, and the design of qualified and nonqualified programs. Significant Clients Served Blue Cross/Blue Shield of Florida City of Clearwater Jackson Memorial Hospital University Community Hospital Miami Department of Off-Street Parking Intracoastal Health Systems The PGA Tour Bayfront Medical Center Education B.A. from the University ofNortb Florida Professional/Community Affiliations Associate of the Society of Actuaries Enrolled Actuary Member of the American Academy of Actuaries Past President, Florida West Coast Employee Benefits Council Member, Southern Employee Benefits Conference PricewaterhouseCoopers LLP 13 Charles Y ovino Human Resource Solutions Principal Southeast Region Tax and Regulatory Practice PricewaterhouseCoopers LLP Professional Experience Charlie, a partner in ourAtlanta office, heads the Legal & Regulatory compliance practice for the Southeast Region. Charlie and his team are transaction oriented, and as a result have effectively combined their regulatory backgrounds with practical experiences to develop a pragmatic approach to the delivery of benefits. Charlie and his team consult with management on a variety of special projects and recurring assignments, including: . Design and administrative considerations for all types of qualified and nonqualified retirement plans, including preparation of administrative manuals and quality controls . Operational compliance reviews (covering all plan types which in the aggregate benefit approximately 1/2 million participants) . Training of employee benefits personnel . Work-flow and staffmg studies of employee benefits departments . Plan spin-offs, mergers and terminations . Due diligence reviews . Total benefit program design and implementation following corporate spin-offs . Outsourcing ofHR departments' functions (including serving in VP-HR role) . Project manager of complex benefit program implementations, including telephone open enrollment, and 401(k) outsourcing . Review of ERISA required audited financials . Preparing governmental reports and filings, including Forms 990, 5300, 5310, 5330, and 5500 Significant Clients Served Coming FedEx PGA and LPGA Springs Industries University Systems of Georgia and Arkansas University of Miami Saks Education B.A. (cum laude) in history (with honors) from Hofstra University J.D. from American University Masters of Law in Taxation from Georgetown University Law Center ProfessionaVCommunity Affiliations District of Columbia and Maryland Bars PricewaterhouseCoopers LLP 14 Elliott I. Cobin Global Human Resource Solutions Director Southeast Health and Welfare Practice PricewaterhouseCoopers LLP Professional Experience Elliott Cobin is a director and consulting actuary in Southeast Health and Welfare practice of the Global Human Resource Solutions line of business. He is a health and welfare actuary with more than twenty-five years of experience. Elliott is an Authorized Actuary by PwC for all health and welfare employee and retiree benefits. He is responsible for over forty GASB, F AS 106 (postretirement welfare) and F AS 112 (post-employment) valuations in the Philadelphia, New York Metro and Atlanta offices. He has extensive experience in funding, window programs, union negotiations, plan redesign, Consumer Directed Healthcare, healthcare liability and IBNR calculations, and fmancial reporting. Significant Clients Served Blue Cross Blue Shield of Florida The State of Alabama Wake CountyN.C. Auburn University Stetson University Sumter Electric Cooperative The Archdiocese of Philadelphia Schools New York Medical College Franklin and Marshall College Oak Ridge Associated Universities Fairleigh Dickinson University Education B.A. (cum laude) from Queens College in NYC M.A. in mathematics from the University of Illinois National Science Foundation Fellowship and a Teaching Assistantship at the University of Illinois Professional Affiliations Associate of the Society of Actuaries Member of the American Academy of Actuaries Member ofPENJERDEL Employee Benefits and Compensation Association (PEBA) PricewaterhouseCoopers LLP 15 JAMES D. BURKE Global Human Resource Solutions, Senior Associate Southeast Retirement Practice PricewaterhouseCoopers LLP Professional Experience Jim Burke is a pension actuary with nine years of experience in the actuarial profession. His experience includes pension plan design, funding, and administration for clients in the public and private sectors. He has acted as a technical resource on pension and post-retirement benefit matters, including designing, implementing, and utilizing funding and expense calculation programs. He also has experience with various government reporting requirements, such as IRS Form 5500, PBGC premium filings, and FASB and GASB reporting and disclosure calculations. Jim completed all exam requirements to become a Fellow of the Society of Actuaries and is currently participating in Professional Development to achieve this designation. He has also passed two of the three examinations required to become an Enrolled Actuary and is currently preparing for the third exam. Significant Clients Served City of Clearwater Jackson Memorial Hospital University of Pennsylvania DENTSPL Y International Main Line Health Education B.s. (cum laude) from Marquette University ProfessionaVCommunity Affiliations Associate of the Society of Actuaries PricewaterhouseCoopers LLP 16 COSTS TO PROVIDE THE VARIOUS SERVICES Our fee estimates have been developed in accordance with an hourly rate structure projecting the time requirements of partners and staff for the work involved. If our role in the engagement and the corresponding time requirements should change appreciably in the course of work, it is our policy to review a revised fee estimate with you before proceeding. Plans administered by PricewaterhouseCoopers are monitored on a continuous basis at no additional cost to ascertain the effects of regulatory change on the qualified status of such plans. Other advisory services which the City may request or special services necessary to maintain the qualified status of the plans are not contemplated in our fee estimate. In connection with all special work, a separate fee estimate will be discussed with you before beginning the project. For planning purposes, however, the average rate per consulting hour is estimated to be in the range of $150 to $350, depending upon the staff mix required to complete the assignment. We anticipate providing the actuarial valuation reports within six to eight weeks of receiving the employee census and trust data. This anticipated response time, as well as our fee estimates, is contingent on the employee census data being accurate and complete within reasonable and customary standards. PricewaterhouseCoopers LLP 17 2005 Estimated Fees Estimated Fees Recurring Actuarial Services - Pension We will perform the annual valuation of the pension plan, including providing a draft report and attending an annual meeting to review the valuation. Recurring Actuarial Services - Retiree Medical We will perform the annual valuation of the retiree medical plan based on the requirements ofGASB Statement 45, including providing a draft report and attending an annual meeting to review it if desired. Option 1 refers to a full actuarial valuation every year. However, many of our clients with relatively stable retiree medical plans and populations only perform a full actuarial valuation every other year, using a roll-forward approach in the intervening years. The city may wish to discuss this approach with its auditors - this approach is specifically permitted by GASB Statement 45. Under this approach we usually prepare the roll-forward under one of two methods: (Option 2) gathering new demographic and claims data, reviewing the actuarial assumptions (baseline costs, participation rates, etc.) and making adjustments to the expected values, or (Option 3) preparing the roll-forward based on the expected values without these adjustments. The choice among these three approaches is one that reflects each client's preference in balancing administrative cost versus minimizing volatility in annual expense. Generally, the more robust the annual valuation, the smaller any incremental changes will be. The City may also wish to have a more robust valuation performed before it adopts GASB Statement 45. Our fees shown above assume the valuation will be performed under a single actuarial cost method (Statement 45 allows anyone of six methods). For many of our clients we have performed five-year projections of expense under all six permitted methods. This would provide the City with a better understanding of its options and the potential difference between the different methods. The cost to provide five-year projections under all six methods is an additional $5,000. PricewaterhouseCoopers LLP $21,000 Option 1 Per Year: $15,000 Option 2 1st Year: $15,000 2nd Year: $8,000 Option 3 1st Year: $15,000 2nd Year: $3,000 18 Employee Pension Statements Individual pension plan benefit statements enhance the visibility of the pension program to each plan participant. All the information that the participant is entitled to request under ERISA is developed. In addition to the required information, the statements present other useful benefit information and a description of some of the more important plan provisions. These statements will be delivered to the City by July 1 for distribution to employees. Miscellaneous Services We will provide all of the other services identified by the City in its request for proposal including advice to the City of tax and plan issues and other communications as required. PricewaterhouseCoopers LLP $2,500 $150 to $350 per hour 19