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City Council Special Meeting: May 27, 2015
Agenda Item: 3-D
To: Mayor and City Council
From: Gigi Decavalles- Hughes, Director
Subject: Modification #4 to Agreement with Ventiv Technology for Maintenance
Support Services
Recommended Action
Staff recommends that the City Council authorize the City Manager to negotiate and
execute a fourth modification to professional /contractual services agreement #7482 in
the amount of $121,832 with Ventiv Technology, an Illinois -based company, for
maintenance support services for a claims management system. This will result in a
two -year amended sole source agreement with a new total amount not to exceed
$739,425, with future year funding contingent on Council budget approval.
Executive Summary
Ventiv Technology, the firm that provides maintenance support to the Finance
Department's automated workers' compensation and liability claims management
system, has announced plans to release a new claims management software system
and phase out support of its existing system. Therefore, the City must transition to a
new system for this service. Staff anticipates that it will take 18 to 24 months to
complete the competitive selection process for a new system, execute a contract and
install a new system.
The City's maintenance agreement with Ventiv Technology is scheduled to expire at the
end of June 2015. To maintain the current claims management system until a new
system is installed and fully operational, staff recommends that the City enter into a
fourth contract modification with Ventiv Technology. The costs for the initial contract
and three existing modifications total $617,593; the fourth modification would increase
the total contract to $739,425. Funding for the agreement will be split between the
Liability, Transit and Workers' Compensation Self- Insurance Funds.
Background
On April 27, 1999 (Attachment A), Council approved an agreement with Valley Oak
System for the purchase and installation of a risk management information system for
claims processing, financial and safety analysis, and budgeting capabilities for the City's
self- insurance programs. On November 28, 2000 (Attachment B), April 12, 2005
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(Attachment C), and January 19, 2010 (Attachment D), Council authorized modifications
to purchase additional licenses and to extend maintenance terms, in the amounts of
$65,600, $190,000, and $247,593 respectively. The cumulative not to exceed amount
is $617,593. This contract term will expire June 30, 2015.
Discussion
The City purchased its current risk management claims management system from
Valley Oaks Systems, Inc. in 1999. This system, referred to as IVOS, is used by the
Finance Department's Risk Management Division to track and report on the City's
workers' compensation and liability claims. Valley Oaks Systems, Inc. has been sold
twice over the last fifteen years; first to Aon eSolutions and most recently to Ventiv
Technology.
Approximately eighteen months ago, Aon eSolutions, now Ventiv Technology,
announced plans to release a new claims management software system and phase out
its support to IVOS over the next few years. In response to this news, staff began
planning to replace the IVOS system. A Request for Information (RFI) was issued in the
fall of 2014 to learn what the software market has to offer after almost two decades of
technology advancements. The City received nine responses to the RFI and used the
information gained from this process to shape the scope and requirements for a claims
management system request for proposals (RFP). Staff plans to release the RFP in
May 2015 and anticipates it will take another 18 to 24 months to complete the
competitive selection process and install and test a new system. The City's current
maintenance agreement will expire at the end of June 2015. The contract modification
with Ventiv Technology is recommended to maintain the current claims management
system until a new system is installed and fully operational.
Consultant Selection
The City solicited proposals for a claims management system in early 1999. Seven
proposals from software vendors were received and evaluated by a panel of staff from
Risk Management, Information Systems, and a software consultant. The panel
recommended the City contract with Valley Oaks Systems, Inc. for the IVOS system
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based on functionality, reporting capabilities and cost. The initial contract has since
been modified on three occasions to purchase additional software modules and extend
the system maintenance agreement. All three modifications were authorized as sole
source purchases of the software to ensure system compatibility and maintenance
because no other vendors offer this service. A fourth modification is recommended to
extend the maintenance agreement for two additional years while staff solicits proposals
for a new claims management system. As with the prior modifications, staff is
requesting authorization for a sole source purchase as maintenance support is only
available through Ventiv Technology.
Financial Impacts & Budget Actions
The agreement modification to be awarded to Ventiv Technology is $121,832, for an
amended agreement total not to exceed $739,425. Funds are included in the FY 2015-
17 Proposed Biennial Budget for Council approval. The costs of the agreement will be
split between the Liability Self- Insurance Fund (25 %), Transit Self- Insurance Fund
(25 %) and Workers' Compensation Self- Insurance Fund (50 %) and charged to account
555060 in each fund. Future year funding is contingent on Council budget approval.
Prepared By: Deb Hossli, Risk Manager
Approved Forwarded to Council
Qigi N ce avalles Huyi D es, irf ecto6/12/2015 Elaine M Polachek, Interim City PS€rt 9005
Attachments:
A. April 27, 1999 Staff Report
B. November 28, 2000 Staff Report
C. April 12, 2005 Staff Report
D. January 19, 2010 Staff Report
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Reference:
Amended Agreement
N o. 7482
(CCS)