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CI* OF SAN BERNARD.O - REQU.... FOR COUNCIL ACeoN
From: Ralph H. Prince
Subject: Auditing Services
tt''I'
Dept: City Attorney
Data: July 25, 1986
Synopsis of Previous Council action:
7/7/86
The Mayor and Common Council authorized the City
Administrator to hire a Claims Auditor for a sum
not to exceed $12,500 for the purpose of auditing
the Risk Management Division.
Recommended motion:
Adopt resolution.
~ V.W"
a.1-'/i I ",,'Uf/-<...e/
Signature
Contact parson:
Raymond D. Schweitzer
Phone:
5122
FUNDING REQUIREMENTS:
Amount:
$12,500
Source:
N/A
w""~t.,.,. Ct,l"""
L.. ~, .. /: + > L "'"'".
.....Ii
F..J.r
Supporting data attached:
Yes
Ward:
Finance: ? / a.- C' ~_
Council Notes:
75-0262
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Agenda Item No J(.
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1
RESOLUTION NO.
2 RESOLUTION OF THE CITY OF SAN BERNARDINO AUTHORIZING THE
EXECUTION AND RATIFICATION OF AN AGREEMENT WITH WARREN, McVEIGH,
3 GRIFFIN & SAVAGE RELATING TO AUDITING SERVICES.
4
BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF
5 SAN BERNARDINO AS FOLLOWS:
6 SECTION 1. The execution of an Agreement relating to
7 auditing services with Warren, McVeigh, Griffin & Savage,
8 effective July 21, 1986, by the City Administrator is hereby
9 authorized and ratified. A copy of said Agreement is attached
10 hereto, marked Exhibit "A" and incorporated herein by reference as
11 fully as though set forth at length.
12 I HEREBY CERTIFY that the foregoing resolution was duly
13 adopted by the Mayor and Common Council of the City of San
14 Bernardino at a
meeting thereof, held on
15 the
16 to wit:
day of
, 1986, by the following vote,
17
18
AYES:
Council Members
19 NAYS:
20 ABSENT:
21
22 City Clerk
23
24 of
25
26
The foregoing resolution is hereby approved this
day
, 1986.
Mayor of the City of' San Bernardino
Approved as to form:
27 ~~~
28 ~t~ney V
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1 AG!EE~E~!
2 (Auditing Services)
3 THIS AGREEMENT is entered into this 23rd day of
4 July , 1986, between the CITY OF SAN BERNARDINO, a
5 municipal corporation, hereinafter -City-, and WARREN, ,McVEIGH,
6 GRIFFIN & SAVAGE, claim management consultants, hereinafter
7 "Consultant-.
8 The parties hereto set forth the terms and conditions upon
9 which certain auditing and evaluation functions will be provided
10 for the City as follows:
11 1. Consultant shall conduct a comprehensive audit and an
12 evaluation of the City's workers' compensation, general liability
13 and automobile liability claim administration program. Consultant
14 shall provide certain auditing and evaluation services as
15 specified in Consultant's Proposal dated June 30, 1986, and
16 supplemented by letter dated July 11, 1986. A copy of said
17 proposal and letter are annexed hereto as ~xhibit -I" and
18 incorporated herein by reference. Consultant agrees to provide
19 all such services in accordance with the terms specified in
20 Exhibit -I", subject to modifications thereto set forth in this
21 agreement and as outlined to and accepted by Consultant on
22 July 11, 1986.
23 2. City retains the services of Consultant for the purposes
24 specified in paragraph 1 above, and agrees to pay to Consultant
25 the fees for services specified in Exhibit "I-. Total cost of the
26 services to the City shall not exceed $4,900 for the scope of work
27 outlined in the proposal I should the audit uncover any
28 irregularity which requires investigation beyond the scope of work
I
EXHIBIT A
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1 stated in the Proposal, Consultant shall immediately notify and
2 confer with the City Attorney and thereafter the City may request
3 additional services which will be billed on a time-and-expense
4 basis pursuant to Consultant's letter dated July 11, 1986.
5 Payment for services shall be made within 20 days of receipt of
6 Consultant's final report and an itemized bill for services
7 rendered.
8 3. Consultant shall commence its auditing and evaluation
9 services on July 21, 1986, and shall complete the scope of work
10 detailed in the proposal within two weeks. The Acting City
11 Administrator may extend the date of completion of the services
12 and report for an additional' two week period or less subject to
13 a progress report being provided by Consultant.
14 IN WITNESS WHEREOP, the parties have hereunto executed this
15 agreement on the day and year first above written.
16
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19
20
21 By
22 Title
23
Approved as to form:
24 ~AiD~
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" SAVAGE
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CIIIIII",~4~
Jun. 30, 1988
City 01 San BernardIno
300 Mortll"D- Street
SUI Bernardino. Calilornla 92418
Att.ntlona Ma. a.an Chow
Alltltant to City Admlniltrator
P&OP08AL 1'0& .O.w.... ceJIIPDIA'l'IOR. GDDAL UABIU'l'T
-AlP &0'f0II0BILB LIA..-.ft"I' CLAIII ADmft.iaA'l'IOR &UDft'
In rupDs'" to your requelt lor pR(IDII1, warren, McV.!Ih. Grillln at Sa,. propal. to
ClOIIduct a compr.....I.. audit 01 tile City 01 San BernardIno (City) work.rs' com~-
lion, pMrll1labWty and automobU. 1IabWty claim admlnltratlon prclIram.
'nil puI'pCIM 01 tile audit wm be to ....t. tile .......t .,n.lDI. procedunI and controll
In tile HIt~ HIt~1aIReNd .......am and 011. reoommendatlonllor Impro~
IHIItI and aontro! 01 tile _,.ltJ 0110lL
R!l
'nil lollDwlnll(leClllc IUbjectl wDl be lnYeltlpted durInI tile COUI'M 01 tile audit!
1. '11Ie current .,n.IIII. procedurea and eontroJa In tile reportlnl. proc..inI,
Invatlptlon and ..tt1em...t 01 work'" colllpeMatlon clallllle Areal .,lIuated
wUllncludea
o Beportlnl - tlm.lineD and 0 DIary IJIt.m
complet...... 01 Employer" Reportl 0 In..tlptlon
o ItaIIInr 0 Temporary dllabWty
o Cualoadl 0 Permanent dllabWty
o 8upervIalon 0 Medical paym...tI
o Claimant eontact 0 Lltlptlon
o Med1cIl eontrol 0 ReIlabWtatlon
o 8ubroptlon 0 PU. doCUmentation
2. The current .,.t.ml, pro4ldurel and aontroJa In tile reportlnl. proc..inI,
In,.tlptlon and ..tt1em...t 01 .-u and automobile liabWty clalll\llIandled
WIder tile claim procram. Areal evaluated wDllnc1udea
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,...____-.c-......Cll.,1U.'0II .
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City of San Bernardino
o Reportinl of incidents
o Reportinl of claims for
dam....
o Staffinl
o SUpervision
o Cuelotldl
o Claimant contact
o Diary IYlItem
o Inv..tJption
3. 'nIe adequaCY of cue reserv...
"'1',,,'"
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June 30, 1986
o Application of government eodes
o Verification of special damaces
o Allocateel expense
o Contributions from joint tort feuors
o TrIIIsfer of rtsk
o Settlements
o Lltlption
o lIubrop.t1on
o POe documentation
4. 'nIe accuracy of cue raerv.., paymenU and reporteel claims u shown on the
mOlt I'ICInt loll experiencI report.
PLAM OP ACTIO"
RaIUlU will be achllvecl tIlroUIb till follo*inI aotivitl...
1. WI wiD conduct a comprahlnlive revilw of a repraentativI random IIIIIPlinl of
open worklrs' compllllltlon, ....ral UabDltJ and automobDa olaims.
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2. A compr...." revilw wiD be madl of a l.,nnntatl.1 samplinI of closecl
claims. -
3. All claims rlvilweel will be ...atcllld to tIlIlat..t loll uparllnCl report.
4. WorkIheeU and individual rol mlmee wiD be maintinecl to proVI patterns and
trends.
5. interviews will be conduoteel with till claim parlOllllll.
8. Wblrl appropriatl, dIf.... ClOUIIMl, ~ Y'lIorJ pIl'IClIUIIl and others wiD be
contacteel.
T. Bued on the data obtalnld In performinl till actlviti.. 1lstecI aboVI, we wiD
prepare a written report reneotinl our findlnp. aoncluslons and reoommenda-
t10111ln each IPIOlflo ar.. studleel.
MATlRIAL'I'O .BSUPPLIBD CODULTAlft'I
To achlevl belt .-dtl, the followinl itlms and data are n.eded.
1. Letter from you authorlsinl till audit of thl Clty's workers' compensation,
lIfterat liability and automobDa liability claims.
2. 'nIe meet recent loll IzperilllCl report liItinC all claims reporteel.
3. Copl.. of tIlIlaIt three yeers' annual reporU to CalIfornia Self-lnIuranCl PlanS.
w-. ...v...... ~ a leJ111
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City of San Bernardino
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June 30, 1986
CONSULTAft .BUOIOIIL AlfD gOAImCA'ft01I8
To ensure objectivity u wen u the prof..ional competence of Its work, Warren,
MeVellb, Griffin & Sav... acts IOlely in an advllory ~elty to manapment. It hu no ."
oonnaoUon with any ad)IItIIlI firm, oJaim admlnlatratlon Ml'Viee, broker or inIUnr. The
resumas of CClftlIUltants ..\ped to thII project are appended to the propDAl.
COlT
For the scope of work outlined in thla propoIfl, the total COlt will be M,IOO~lUdi~U
expenMI for tranIPOPtatlon, lodlinl, meaJI, report produotlon, and tele()hon en es.
Our Invoioal, which will be IUbmitted with our final report, will be due and payable
within ~_~ys of your raoalpt.
'l'DIIICDDOLB
If our propllP1 Is aceapted, the claim audlt will be completed and our final report
rendered within II dQI from the notice of aoeeptanee. 'n\lI UlUmas that we will
encounter no unlllUAl delays In obtalninl needed Information or In IOhedullnIlnterviews.
. . . . .
We appracIate the upportunlty to IUbmit thII prap_l and look forward to performlnc
thlIlmportant project.
WARREN, McVEIGH, GlUPPlN & SAVAGE
.. ~.., 1'41 )
"K. J. Sa
M Partner
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Claim ....-' eonou_
July 11, 1986
City of San Bernudino
300 North "D" Street, 6th Floor
San Bernardino, California 92418
Attention! Ms. Susan Chow
Alsistant to City Administrator
Dear MI. Chow:
11Iis will confirm our meetinr of tills date. AssumfnC we encounter no unlllUal delays In
obtaining needed Information or lit scIledullnr intervi.Ws, Warren, McVellh, Griffin &:
Sav... is prepared to ltart work Immediately upon notice from the City and will
complete the scope of work c1ataned in our propoAl within two .aakI. '
CONPlDBNTlAL
Should our claim audit uncover any IrrecuJarity which requires investigation beyond the
scope of work stated in our propoul, .e will be pleased to pursue the study further after
consulting with the des""ated City of San Bernardino official. 11Iil additional phase, if
needed, .m be billed on a tim.-.nd-eXpanH basls. our current hourly rates are $110 for
both Mr. Low and myself.
aeeognlzing the City.. concern in controUlng expenses and u an alternative option (if
needed), we, will endeavor to provide an independent and competent investigative service
to perform any necessary fIeld work. We estimate those charges will rU118 between $35
and $80 per hour. .
We belleve the confidentiality of Information must be respected. While our wide
experience with many pubUc entities helpl us to render competent service to every
client, we will not dlvuIp any specific information witbout that cUent.. consent.
We appreciated the opportunity to meet with the City" committee and look forward to
performing this important audit. '
Very truly yours,
,,/7/'" .?
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K; .r. -savar..'
M~ Partner
KJS:de
'.20 _ _ _. -...._. ~'2IIO.(71.1752-10l5l1