SR 06-26-2018 3E
City Council
Report
City Council Meeting: June 26, 2018
Agenda Item: 3.E
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To: Mayor and City Council
From: Donna Peter, Director, Human Resources Department
Subject: Professional Services Agreement for Employee Benefits Consulting Services
Recommended Action
Staff recommends that the City Council:
1. Award RFP#173 to Alliant Insurance Services, Inc., (Alliant), a California-based
company for employee benefits consulting services;
2. Authorize the City Manager to negotiate and execute an agreement with Alliant,
in an amount not to exceed $273,000 (including a $25,000 contingency) for three
years, with two additional 1-year renewal options in the amount of $96,800
(including a $8,800 contingency) for the first renewal option and $101,200
(including a $9,200 contingency) for the second renewal option, otherwise on the
same terms and conditions, for a total amount not to exceed $471,000 over a 5-
year period, with future funding contingent on Council budget approval.
Executive Summary
Like most large employers, the City of Santa Monica offers its workforce access to a
range of health care insurance plans as an employee benefit. In order to ensure cost-
effectiveness in a competitive marketplace for health plan coverage, Alliant provides
benefits consulting services which includes the negotiation of health and welfare
insurance benefit plans and renewals with insurance carriers, issuing and assisting with
requests for proposals for health insurance coverage, handling problematic insurance
claim issues, proactive communication of emerging trends and regulatory updates, and
other employee health and welfare issues. Alliant was selected through a competitive
process to provide these services for an initial three-year term with two additional one-
year renewal options for a five-year contract in an amount not to exceed $471,000
(including 10% contingency). Selection criteria included but were not limited to
technical expertise, knowledge of the industry, overall cost and fee structure.
Discussion
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Alliant would provide the City of Santa Monica a full range of employee benefits
consulting services and day-to-day benefit plan administration, which includes the
following services: renewal negotiations with carriers; contract review; claims/service
assistance with vendors; legislative updates and interpretation; client meetings; vendor
interface (correspondence and meetings); plan design; employee benefits strategic
planning; financial analysis; claims experience analysis and reporting; plan marketing
and general consulting services related to City employee benefit plans.
Vendor Selection
On April 30, 2018, the City published a Request for Proposal (RFP) for employee
benefits consulting services. The bid was posted on the City’s on-line bidding site, and
sent to four firms that provide benefits consulting services. Six bids were received,
reviewed, and scored by a team comprised of Human Resources staff. The six
proposals received were from vendors:
Alliant Insurance Services, Inc.
Gallagher Benefit Services, Inc.
Keenan Associates
USI Insurance Services
Burnham Benefits Insurance Services, Inc.
POMS & Associates
Proposals were evaluated based on the criteria in SMMC 2.24.072, including ability to
provide the scope of services, demonstration of technical competence, qualifications
and experience of individual team members, references and marketplace position,
overall cost and fee structure.
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Alliant is the 9th largest Employee Benefits firm in the United States and is the largest
public entity broker and consultant in California. Their headquarters are located in
Newport Beach, California. They have extensive public sector experience, which
includes numerous cities, counties, special districts and schools.
Based on the criteria and Alliant’s ability to meet the criteria, staff recommends that the
City Council award bid #173 to Alliant for a total amount not to exceed $471,000 over a
five year period. The not to exceed amount includes a 10% contingency.
Financial Impacts and Budget Actions
The professional service agreement to be awarded to Alliant is for an amount not to
exceed $471,000 (includes 10% contingency). Funds of $90,300 are available in the FY
2018-19 budget in Division 253; the contract will be charged to account 01253.555060 /
01130004.552010. Budget authority for subsequent budget years will be requested in
each budget for Council approval. Future funding is contingent upon Council approval
and budget adoption.
Fiscal Year
Flat Annual Fee
(includes 10% contingency)
FY 2018-19 $90,300
FY 2019-20 $90,300
FY 2020-21 $92,400
FY 2021-22 (optional) $96,800
FY 2022-23 (optional) $101,200
Total $471,000
Prepared By: Tatiana Morrison, Executive Administrative Assistant
Approved
Forwarded to Council
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Attachments:
A. City of Santa Monica - Oaks Initiative - COMPLETED
REFERENCE:
Agreement No. 10702
(CCS)