LIABILITY CLAIMS ADMINISTRATION SERVICE

AWARD OF CONTRACT

Recommendation:

Staff recommends that City Council award the contract for Third Party Administration of Liability Claims to Fleming & Associates and authorize the City Manager to negotiate and execute a contract for the three year term commencing July 1, 1997.

Background:

The current administrator for liability claims is Colen & Lee. On June 9, 1992, the City Council selected Colen & Lee to serve as Third Party Administrator for liability claims. The original RFP allowed for a three year contract with an additional two year renewal option. On May 23, 1995, City Council approved a two year extension with Colen & Lee. That contact expires on June 30, 1997. The current annual service fee with Colen & Lee is $17,460.

On March 24, 1997, Requests for Proposals were mailed to the fourteen (14) firms listed below:

• Frontier Risk Management
• Crawford & Company
  
• Tristar Risk Management
• Southland Claims Service
  
• Colen & Lee
• Keenan & Associates
  
• Self-Insured Management Services
• FIRM Solutions
• Lindsey & Newson Claims Mgmt., Inc.
• State Funds Claims Mgmt. Services
  
• Associated Claims Management
• Fleming & Associates
• Carl Warren & Company
• Arthur J. Gallager & Co.

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The legal ad announcing the Request for Proposals appeared in the EasyReader on April 3, 1997.

Sealed proposal from five (5) firms were received by the City Clerk's Office, opened and read aloud on Thursday, April 24, 1997 as advertised. These proposals are available for review in the Office of the City Clerk.

Analysis:

Listed below is a display of the proposal costs submitted by the responding firms:

COMPANY -- 1ST YEAR -- 2ND YEAR -- 3RD YEAR

• Carl Warren Company $26,400 $27,600 $28,800
• Colen & Lee $16,800 $16,800 $16,800
• Crawford & Company $15,488 $15,488 $15,888, plus CPU + 1%
• Self Insured Mgt. Service $14,000 $14,000 $14,000
• Fleming & Associates $ 9,750 $ 9,750 $ 9,750

After a review of the proposals submitted, Fleming & Associates was selected to be interviewed by the City Manager and Risk Manager. Following that interview, and contact with firm references, Fleming was selected to be recommended to the City Council to provide Liability Claims Administration services for the term July 1, 1997 through June 30, 2000 (with an option to negotiate a two year extension based on performance)