HomeMy WebLinkAboutAgenda Report - August 16, 2017 C-09TM
CITY OF LODI
COUNCIL COMMUNICATION
AGENDA ITEM
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AGENDA TITLE: Adopt Resolution Authorizing City Manager to Waive the Bid Process and Execute
a Software as a Service (SaaS) Agreement with Govinvest, Inc. (Govinvest), of
Torrance for Pension Transparency Total Liability Calculator Software (Pension
Module) ($45,750) With an Option to Purchase the Other Post Employment Benefit
(OPEB) Transparency Total Liability Calculator Software (OPEB Module) ($32,500)
MEETING DATE: August 16, 2017
PREPARED BY: Deputy City Manager
RECOMMENDED ACTION: Adopt resolution authorizing City Manager to waive the bid process
and execute a Software as a Service (SaaS) Agreement with
Govinvest, Inc. (Govinvest), of Torrance for pension transparency
total liability calculator software (Pension Module) ($45,750) with an option to purchase the Other Post
Employment Benefit (OPEB) transparency total liability calculator software (OPEB Module) ($32,500).
BACKGROUND INFORMATION: The City's current pension liability is no secret. As the foremost
financial concern facing the City, there is a critical need for clear,
concise communication with all interested parties regarding the
severity and potential funding solutions. The problem is multi -layered and will take a collaborative effort
to resolve. Staff needs to provide Council, the public, management, CaIPERS, the state legislature,
municipal professional organizations (such as the California Society of Municipal Finance Officers and
the League of California Cities) and employee labor groups clear, concise and varied communication.
CaIPERS conducts annual actuarial studies to determine the City's annual contributions and total
Unfunded Accrued Liability (UAL). These studies are very useful, but contain complicated information
that is not consumable to most audiences. In addition, the studies are snapshots in time, do not provide
scenario analysis nor do they allow for drill down to specific employee groups or employees. The ability
to determine and show liabilities on a smaller scale for specific discussions will enhance discussions with
the aforementioned interest groups. In house resources and those provided by CaIPERS do not provide
the tools necessary. Staff has recently reviewed options for better presenting funding scenarios and
current status to various constituency groups.
Govinvest's product relies on actual data from the actuarial reports to project pension payments, both
UAL and Normal Cost over a defined time period. It also allows for clear, concise, graphical presentation
of complex information as it relates to various funding strategies. Within the product, staff will have the
ability to quickly drill down to defined employee groups and even to individual employees. In addition,
Staff can make adjustments to various demographic or actuarial assumptions to quickly assess the
impact to Lodi. Staff can also model the impact of higher or lower earnings rates by CaIPERS. Each of
these scenarios can be separately saved for quick recall at a later time. Within each scenario are tables
and graphs showing the results and comparison of the results to the base case scenario within the
actuarial study. Govinvest's product is unique to the marketplace in the function it serves and the ease of
use it provides.
APPROVED:
5 ephen chwa
City Manager
With this information, Staff will be able to have more honest dialogue with interested groups.
Presentation clarity provided by the Pension Module will help interested parties to better understand the
current situation and any scenarios surrounding that scenario.
Govinvest offers a similar OPEB module. However since OPEB plans vary by agency, the module is not
as robust and has a longer lead time to implement. Similarly, Lodi's OPEB liability is limited and capped
due to past decisions closing the more expensive plan and creating a fixed (defined benefit) plan for new
hires. The proposed contract allows for the City Manager to implement the OPEB module at a later date.
Staff will focus on implementing the Pension Module to its fullest and continue to analyze the merits of
the OPEB module prior to implementing that product.
FISCAL IMPACT: The cost of the Pension Module is $45,750 for the life of the contract
broken down as follows:
Fiscal Year
Service
Cost
Est. Share - Life of
Contract (PERS
Module Only)
General Fund
71.08%
2017/18
Implementation Fee
$2,000
2017/18
Annual License
$8.750
2018/19
Annual License
$8,750
2019/20
Annual License
$8.750
2021/22
Annual License
$8,750
2022/23
Annual License
$8,750
Electric Utility
11.49%
$ 1,235.18
Pension Module Total Cost
$45,750
The cost of the optional OPEB Module is $38,875 for the life of the contract. This service will be optional
and activated at the discretion of the City Manager at a later date.
FUNDING AVAILABLE: The Fiscal Year 2017/18 Budget projected the City's CaIPERS
contributions at the monthly billing rate. Staff has made the decision to pay
the UAL portion of the PERS bill in a lump sum annual payment. This
option provides a 3.55% discount over the monthly payment option. Staff is proposing using that savings
to fund this contract. Costs will be split on each fund's prorated portion of the UAL payment as follows:
Fund
Fiscal Year
2017/18 PERS
0/0 Share
FY 2017/18 Gov
Invest Share
Est. Share - Life of
Contract (PERS
Module Only)
General Fund
71.08%
$ 7,641.10
$ 32,519.10
Library
0.92%
$ 98.90
$ 420.90
PRCS
3.23%
$ 347.23
$ 1,477.73
Community
Development
1.80%
$ 193.50
$ 823.50
Streets
1.67%
$ 179.53
$ 764.03
Electric Utility
11.49%
$ 1,235.18
$ 5,256.68
Wastewater
7.42%
$ 797.65
$ 3,394.65
Water
0.79%
$ 84.93
$ 361.43
Transit
0.51%
$ 54.83
$ 233.33
Fleet
1.09%
$ 117.18
$ 498.68
Grand
100.00%
$ 10,750.00
$ 45,750.00
ndrew Keys
Deputy City Manager/Internal Services Director
City of Lodi
SaaS Licensing Agreement
Attention: City of Lodi
Prepared by: Ted Price, CEO
July 18th, 2017
Actuarial Services and Technology
Licensing Agreement
Page 1
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Summary of Services and implementation
Customer:
Andrew Keys, Finance Director
Lodi City Hall
221 W Pine St
Lodi, CA 95240
(209) 333-6800
AKeys@lodi.gov
Services:
Service Capacity: Use of the Standard Pension Module the Total Liability Calculator (the "Service(s)").
Service Fees:
Pension Module
$8,750 per year ($43,750 total contract value.)
Option to purchase OPEB Module
$6,500 per year ($32,500 total contract value.)
Initial Term: Five years from Effective Date.
Implementation Services:
Company will use commercially reasonable efforts to provide Customer the services described in
accordance with the terms herein, and Customer shall pay Company the Implementation Fee in
accordance with the terms herein.
Pension Implementation Fee (One -Time): $2,000
OPEB Implementation Fee (One -Time): $6,375.
SERVICE AGREEMENT
This SaaS Services Agreement ("Agreement") is entered into on this 18th day of July, 2017 (the
"Effective Date") between Govinvest, Inc. ("Company"), and the Customer listed above ("Customer").
This Agreement includes and incorporates the above Summary of Services and Implementation, as well
as the attached Terms and Conditions and contains, among other things, warranty disclaimers, liability
limitations and use limitations. There shall be no force or effect to any different or additional terms of any
purchase order, confirmation or similar form, even if signed by the parties before or after the date hereof.
Govinvest Inc. City of Lodi
By: ?,4zc4. By:
Name: Ted Price Name:
Title: (FC Title:
Date: 7/18/2017 Date:
Actuarial Services and Technology
Licensing Agreement
Page 2
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Govinvest
Approld isioteno
Dcpa1v City AtIon ey fr
City of Lodi
TERMS AND CONDITIONS
1. SAAS SERVICES AND SUPPORT
1.1 Subject to the terms of this Agreement, Company will use commercially reasonable efforts to
provide Customer the Services in accordance with the Service Level Terms attached hereto as
Exhibit A. As part of the registration process, Customer will identify an administrative user name
and password for Customer's account. Company reserves the right to refuse registration or cancel
passwords it deems inappropriate.
1.2 Subject to the terms hereof, Company will provide Customer with reasonable technical support
services in accordance with the terms set forth in Exhibit B.
2. RESTRICTIONS AND RESPONSIBILITIES
2.1 Customer will not, directly or indirectly; reverse engineer, decompile, disassemble or otherwise
attempt to discover the source code, object code or underlying structure, ideas, know-how or
algorithms relevant to the Services or any software, documentation or data related to or used to
provide the Services ("Software"); modify, translate, or create derivative works based on the
Services or any Software (except to the extent expressly permitted in writing by Company or
authorized within the Services); use the Services or any Software for timesharing or service
bureau purposes or otherwise for the benefit of a third party; or remove any proprietary notices or
labels.
2.2 Further, Customer shall not export or re-export, either directly or indirectly, the Software or any
copies thereof in such manner as to violate the export laws and regulations of the United States or
any other applicable jurisdiction in effect from time to time (including, without limitation, when
such export or re-export requires an export license or other governmental approval without first
obtaining such license or approval). Without limiting the foregoing, Customer shall not permit
any third parties to access or use the Services in violation of any United States export embargo,
prohibition, or restriction.
2.3 Customer hereby agrees to indemnify and hold harmless Company against any damages, losses,
liabilities, settlements and expenses (including without limitation costs and attorney's fees) in
connection with any claim or action that arises from Customer's failure to comply with the terms
of this Agreement or otherwise from Customer's use of Services. Although Company has no
obligation to monitor Customer's use of the Services, Company may do so. Company reserves the
right, in its sole discretion, to prohibit or suspend Customer's use of the Services at any time
Company believes such use to be in violation of this Agreement or otherwise harmful to the
Service.
2.4 Customer shall be responsible for obtaining and maintaining any equipment and ancillary services
needed to connect to, access or otherwise use the Services, including, without limitation,
modems, hardware, servers, software, operating systems, networking, web servers and the like
(collectively, "Equipment"). Customer shall also be responsible for maintaining the security of
the Equipment, Customer account, passwords (including but not limited to administrative and
user passwords) and files, and for all uses of Customer account or the Equipment with or without
Customer's knowledge or consent.
3. CONFIDENTIALITY; PROPRIETARY RIGHTS
3.1 One party (the "Receiving Party") understands that the other party (the "Disclosing Party") has
disclosed or may disclose business, technical or financial information relating to the Disclosing
Party's business (hereinafter referred to as "Proprietary Information" of the Disclosing Party).
Proprietary Information of Company includes non-public information regarding features,
functionality and performance of the Service. Proprietary Information of Customer includes non-
public data ("Customer Data") provided by Customer to Company to enable the provision of the
Actuarial Services and Technology
Licensing Agreement
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Services. The Receiving Party agrees: (i) to take reasonable precautions to protect such
Proprietary Information, and (ii) not to use (except in performance of the Services or as otherwise
permitted herein) or divulge to any third party any such Proprietary Information. The Disclosing
Party agrees that the foregoing shall not apply with respect to any information after five (5) years
following the disclosure thereof or any information that the Receiving Party can document (a) is
or becomes generally available to the public, without any action by, or involvement of, the
Receiving Party or (b) was in its possession or known by it prior to receipt from the Disclosing
Party, or (c) was rightfully disclosed to it without restriction by a third party, or (d) was
independently developed without use of any Proprietary Information of the Disclosing Party or
(e) is required to be disclosed by law. The Receiving Party acknowledges that in the event of a
breach of Section 3.1 by the Receiving Party, substantial injury could result to the Disclosing
Party and money damages will not be a sufficient remedy for such breach. Therefore, in the event
that the Receiving Party engages in, or threatens to engage in, any act which violates Section 3.1,
the Disclosing Party will be entitled, in addition to all other remedies which may be available to it
under law, to seek injunctive relief (including, without limitation, temporary restraining orders, or
preliminary or permanent injunctions) and specific enforcement of the terms of Section 3.1. The
Disclosing Party will not be required to post a bond or other security in connection with the
granting of any such relief.
3.2 Company shall own and retain all rights, title and interest in and to: (i) the Services and Software,
together with all improvements, enhancements, modifications, changes, translations, compilation,
and derivative works thereto, (ii) any software, applications, inventions or other technology
developed in connection with Implementation Services or support, (iii) any analytics generated
through Customer's use of the Services, including but not limited to, any data, materials,
information, and reports ("Analytics") and (iv) all intellectual property rights related to any of the
foregoing. Company hereby grants Customer a non-exclusive, non -transferable and non-
sublicensable license to access and use the Analytics.
3.3 Notwithstanding anything to the contrary, Company shall have the right to collect and analyze
data and other information relating to the provision, use and performance of various aspects of the
Services and related systems and technologies (including, without limitation, information
concerning Customer Data and data derived therefrom), and Company will be free (during and
after the term hereof) to: (i) use such information and data to improve and enhance the Services
and for other development, diagnostic and corrective purposes in connection with the Services
and other Company offerings, (ii) disclose such data solely in aggregate or other de -identified
form in connection with its business, and (iii) disclose, share, license, or resell Analytics to third
parties for consideration. No rights or licenses are granted except as expressly set forth herein.
4. PAYMENT OF FEES
4.1 Customer will pay Company the then applicable fees described in the Summary of Services and
Implementation in accordance with the terms therein (the "Fees"). If Customer's use of the
Services exceeds the Service Capacity set forth in the Summary of Services and Implementation
or otherwise requires the payment of additional fees (per the terms of this Agreement), Customer
shall be billed for such usage and Customer agrees to pay the additional fees in the manner
provided herein. Company reserves the right to change the Fees or applicable charges and to
institute new charges and Fees at the end of the Initial Term or then current Renewal Term, upon
thirty (30) days prior notice to Customer (which may be sent by email). If Customer believes that
Company has billed Customer incorrectly, Customer must contact Company no later than 60 days
after the closing date on the first billing statement in which the error or problem appeared, in
order to receive an adjustment or credit. Inquiries should be directed to Company's customer
support department.
Actuarial Services and Technology
Licensing Agreement
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4.2 Company may choose to bill through an invoice, in which case, full payment for invoices issued
in any given month must be received by Company thirty (30) days after the mailing date of the
invoice. Unpaid amounts are subject to a finance charge of 1.5% per month on any outstanding
balance, or the maximum permitted by law, whichever is lower, plus all expenses of collection
and may result in immediate termination of Service. Customer shall be responsible for all taxes
associated with Services other than U.S. taxes based on Company's net income.
5. TERM AND TERMINATION
5.1 Subject to earlier termination as provided below, the Initial Term of this Agreement shall be for a
period specified in the Summary of Services and Implementation (the "Initial Term"). Upon the
expiration of the Initial Term, this agreement shall automatically renew for additional periods of
the same duration as the Initial Term (each a "Renewal Term"). The Initial Term and the Renewal
Term are collectively referred to herein as the "Term."
5.2 In addition to any other remedies it may have, either party may terminate this Agreement upon
thirty (30) days written notice (or without notice in the case of nonpayment), if the other party
materially breaches any of the terms or conditions of this Agreement. Customer will pay in full
for the Services up to and including the last day on which the Services are provided. All sections
of this Agreement which by their nature should survive termination will survive termination,
including, without limitation, accrued rights to payment, confidentiality obligations, warranty
disclaimers, and limitations of liability.
6. WARRANTY AND DISCLAIMER
Company shall use reasonable efforts consistent with prevailing industry standards to maintain
the Services in a manner which minimizes errors and interruptions in the Services and shall
perform the Implementation Services in a professional and workmanlike manner as expressed in
Exhibit C. Services may be temporarily unavailable for scheduled maintenance or for
unscheduled emergency maintenance, either by Company or by third -party providers, or because
of other causes beyond Company's reasonable control, but Company shall use reasonable efforts
to provide advance notice in writing or by e-mail of any scheduled service disruption. However,
Company does not warrant that the Services will be uninterrupted or error free; nor does it make
any warranty as to the results that may be obtained from use of the Services. EXCEPT AS
EXPRESSLY SET FORTH IN THIS SECTION, THE SERVICES, THE ANALYTICS, AND
IMPLEMENTATION SERVICES ARE PROVIDED "AS IS" AND COMPANY DISCLAIMS
ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO,
IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
PURPOSE AND NON -INFRINGEMENT.
7. INDEMNITY
Company shall hold Customer harmless from liability to third parties resulting from infringement
by the Service of any United States patent or any copyright or misappropriation of any trade
secret, provided Company is promptly notified of any and all threats, claims and proceedings
related thereto and given reasonable assistance and the opportunity to assume sole control over
defense and settlement; Company will not be responsible for any settlement it does not approve in
writing. The foregoing obligations do not apply with respect to portions or components of the
Service (i) not supplied by Company, (ii) made in whole or in part in accordance with Customer
specifications, (iii) that are modified after delivery by Company, (iv) combined with other
products, processes or materials where the alleged infringement relates to such combination, (v)
where Customer continues allegedly infringing activity after being notified thereof or after being
informed of modifications that would have avoided the alleged infringement, or (vi) where
Customer's use of the Service is not strictly in accordance with this Agreement. If, due to a claim
Actuarial Services and Technology
Licensing Agreement
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of infringement, the Services are held by a court of competent jurisdiction to be or are believed by
Company to be infringing, Company may, at its option and expense (a) replace or modify the
Service to be non -infringing provided that such modification or replacement contains
substantially similar features and functionality, (b) obtain for Customer a license to continue
using the Service, or (c) if neither of the foregoing is commercially practicable, terminate this
Agreement and Customer's rights hereunder and provide Customer a refund of any prepaid,
unused fees for the Service.
8. LIMITATION OF LIABILITY
NOTWITHSTANDING ANYTHING TO THE CONTRARY, EXCEPT FOR BODILY INJURY
OF A PERSON, COMPANY AND ITS SUPPLIERS (INCLUDING BUT NOT LIMITED TO
ALL EQUIPMENT AND TECHNOLOGY SUPPLIERS), OFFICERS, AFFILIATES,
REPRESENTATIVES, CONTRACTORS AND EMPLOYEES SHALL NOT BE
RESPONSIBLE OR LIABLE WITH RESPECT TO ANY SUBJECT MATTER OF THIS
AGREEMENT OR TERMS AND CONDITIONS RELATED THERETO UNDER ANY
CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER THEORY: (A) FOR ERROR
OR INTERRUPTION OF USE OR FOR LOSS OR INACCURACY OR CORRUPTION OF
DATA OR COST OF PROCUREMENT OF SUBSTITUTE GOODS, SERVICES OR
TECHNOLOGY OR LOSS OF BUSINESS; (B) FOR ANY INDIRECT, EXEMPLARY,
INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES; (C) FOR ANY MATTER
BEYOND COMPANY'S REASONABLE CONTROL; OR (D) FOR ANY AMOUNTS THAT,
TOGETHER WITH AMOUNTS ASSOCIATED WITH ALL OTHER CLAIMS, EXCEED THE
FEES PAID BY CUSTOMER TO COMPANY FOR THE SERVICES UNDER THIS
AGREEMENT IN THE 12 MONTHS PRIOR TO THE ACT THAT GAVE RISE TO THE
LIABILITY, IN EACH CASE, WHETHER OR NOT COMPANY HAS BEEN ADVISED OF
THE POSSIBILITY OF SUCH DAMAGES.
9. MISCELLANEOUS
If any provision of this Agreement is found to be unenforceable or invalid, that provision will be
limited or eliminated to the minimum extent necessary so that this Agreement will otherwise
remain in full force and effect and enforceable. This Agreement is not assignable, transferable or
sublicensable by Customer except with Company's prior written consent. Company may not
transfer or assign any of its rights and obligations under this Agreement without Customer's prior
written consent. This Agreement is the complete and exclusive statement of the mutual
understanding of the parties and supersedes and cancels all previous written and oral agreements,
communications and other understandings relating to the subject matter of this Agreement, and all
waivers and modifications in this Agreement must be in a writing signed by both parties, except
as otherwise provided herein. No agency, partnership, joint venture, or employment is created as
a result of this Agreement and Customer does not have any authority of any kind to bind
Company in any respect whatsoever. In any action or proceeding to enforce rights under this
Agreement, the prevailing party will be entitled to recover costs and attorneys' fees. All notices
under this Agreement will be in writing and will be deemed to have been duly given when
received, if personally delivered; when receipt is electronically confirmed, if transmitted by
facsimile or e-mail; the day after it is sent, if sent for next day delivery by recognized overnight
delivery service; and upon receipt, if sent by certified or registered mail, return receipt requested.
This Agreement shall be governed by the laws of the State of California without regard to its
conflict of laws provisions. The parties shall work together in good faith to issue at least one
mutually agreed upon press release within 90 days of the Effective Date, and Customer otherwise
agrees to reasonably cooperate with Company to serve as a reference account upon request.
Actuarial Services and Technology
Licensing Agreement
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EXHIBIT A
Service Level Terms
The Services shall be available 99% of the time, measured monthly, excluding holidays and weekends
and scheduled maintenance. If Customer requests maintenance during these hours, any uptime or
downtime calculation will exclude periods affected by such maintenance. Further, any downtime resulting
from outages of third party connections or utilities or other reasons beyond Company's control will also
be excluded from any such calculation. Customer's sole and exclusive remedy, and Company's entire
liability, in connection with Service availability shall be that for each period of downtime lasting longer
than 12 hours, Company will credit Customer 1% of Service Fees for each period of 30 or more
consecutive minutes of downtime; provided that no more than one such credit will accrue per day.
Downtime shall begin to accrue as soon as Customer (with notice to Company) recognizes that downtime
is taking place, and continues until the availability of the Services is restored. In order to receive
downtime credit, Customer must notify Company in writing within 12 hours from the time of downtime,
and failure to provide such notice will forfeit the right to receive downtime credit. Such credits may not
be redeemed for cash and shall not be cumulative beyond a total of credits for one (1) week of Service
Fees in any one (1) calendar month in any event. Company will only apply a credit to the month in which
the incident occurred. Company's blocking of data communications or other Service in accordance with
its policies shall not be deemed to be a failure of Company to provide adequate service levels under this
Agreement.
Actuarial Services and Technology
Licensing Agreement
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EXHIBIT B
Support Terms
Company will provide Technical Support to Customer via both telephone and electronic mail on
weekdays during the hours of 9:00 a.m. through 5:00 p.m. Pacific Standard Time, with the exclusion of
Federal Holidays ("Support Hours").
Customer may initiate a help desk ticket during Support Hours by calling 213-534-6898 or any time by
emailing support@govinvest.com.
Company will use commercially reasonable efforts to respond to all help desk tickets within one (1)
business day.
Actuarial Services and Technology
Licensing Agreement
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EXHIBIT C
Disclaimer of Analysis
Company will provide software with financially sound projections and analysis, but does not yet
guarantee compliance with actuarial standards for funding and accounting purposes including GASB 27,
68, 45, or 75.
Actuarial Services and Technology
Licensing Agreement
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Insights to your financial future
Insights to your financial future
4sok Govinvest
loi
Insights to your financial future
Govinvest presents your agency with a software platform to
forecast pension, OPEB, and bonded debt information on an
interactive, analytical, and transparent paLrorm
The Software
info@govinvest.com
4(0k Govinvest
Insights to your financial future
Total Liability Calculator
• Effortless Analysis
• Interactive
• Transparent
• Real-time information as of last payroll period; no more
2 -year old information from CaPERS
• Solutions to manage your unfunded liabilities
3
,Illi Govl nvest
WeIcorne
Admin
0 q
Ai
0 ir-
Pension CHB
$
Bonded Debt
0
About
MI
Contact
A OVERVIEW
YEAR
2013 0
PLANS &TIERS
101 All
0 Miscellaneous
0 SaietY
EMPLOYER CONTRI B!TION
ANNUAL PAYROLL LUMP SUM PREPAYMENT
$13.80M 1 25.4% $54.32M $13.31M 124.5%
11 di ■i■
UNFUNDED LIABILITY
0 CONTRIBUTION 0 EMPLOYER NORMAL COST
EMPLOYEE CONTRIBUTION
PLAN MEMBERSHIP
is, Active
is, Separated
0 Transferred
0 Retired
Total Members
View key numbers in Overview and Plan Membership Panels
611
201
320
953
2,085
c,
Pension Cost Overview
Liabilities Cost
4
PLANS &TIERS
0 All
0 Miscellaneous
0 Safety
ADJUST ST U M PTIO N5 AND VARIABLES
Years Projected
Discount Fate ).
Salary Increase (%)
N-_-e-
5
7-5
3
Amortization Period (Verse
Lump Sur, Payment ($M).
A.ANALYSIS
30
0
II
wellna_ A.
MARK ET VALUE OF ASSETS () NET PENSION LIABILITY 0 ACCRUED LIABILITY
$732.58M
$5tO_ M
$ 25 Cli_OOM
.
00
21X7
Year: 2016 Accrued Liability: $732.58M Net Pension Liability: $1.21.90M
Pension Liability Overview
L1a bIIIt1es Cost
2C08
2iC9
23L
Yea
r MARKET VALUE OF ASSETS
2007 $490..97M
2003 $462,60
2009 $345..74
2011
2012
2013 2014
Valuation Date As Of
NET PENSION LIABILITY
$05.5061)
$54.9061
$224,4Tv
2015
2016
2017
2018
ACCRUED LIABILITY
$484.47M
$517.51M
57O.21M
2019
Understand the Net Pension Liability and how it's impacted by adjusting key assumptions & variables
2020
5
PLANS &TIERS
10 All
0 Miscellaneous
0 ft
ADJUST ASSUMPTIONS AND VARIABLES
Years Projected
Discount Fate (90
Salary Increase ()
Amortization Period (Tears).
Lure Suri Payment C M
LAN A LY51
5
7-5
3
30
0
Reset
UNFUNDED LIA6ILRY
0 CONTRIBUTION
i.20_00M
$13.131v1
.5_M
MOD
2L:9
0 EMPLOYER NORMAL COST 0 EMPLOYEE CONTRIBUTION
Year: 2016 Employer NormaI Com: $6.67M [ 12.7% Total Employer Contribution: $13.73M126.i%
Pension Cost Overview
eta bIliti ss Cost
2010
2011
El Show as Percent of Payroll
UNFUNDED LIABILff(
Yea
r CONTRIBUTION
2C:-._:9 $3.V2M
20:2
2013
2014 2015
For Fiscal Year Beginning
ig
2016
2017
2018
EMPLOYER NORMAL COST 0 EMPLOYEE CONTRIBUTION
$7.89M
$5.03M
2C."..0 $4 OO 7, M $5.00M
2019 2020
Understand the year-to-year costs and how they're impacted by adjusting key assumptions & variables
6
• Govl n
r
PLANS & TIERS
0 All
Miscellaneous
Safety
Membership Level Scenario Analysis
Last Name First flame Title Tier Years of Service
Gonzalez Miguel Firefighter PEPRA 0.6
O Shank Danielle Firefighter PURA 0.6
Frey Bryan Firefighter PEPRA 0.6
Tcm sick James Firefighter PEPRA 0.6
O Alonzo Jason Firefighter PEPRA 0.6
Mattes Adam Firefighter PEPRA 0.6
5 h a I (cross Chapman Firefighter Classic 24
De Metropolis Sean Firefighter Classic 16.E'
Campagna Mark Firefighter Classic 11
O Perry Amos. Firefighter CIa ssic 1..'
El La tato Robert Firefighter Classic 8.1
Worthy Jeffery Firefighter Classic 27.7
Multi Edit
Delete Selected
Import
New
Done
ei
UNFUNDED LIABILITY
01 CONTRIBUTION
EMPLOYER NORMAL COST 0 EMPLOYEE CONTRIBUTION
Yep r: 2016 Employer NormaI Cost: $6.67M 1 12.7% Tota( Employer Contribution: $13.73M126.1%
ie
1
ick
611
201
320
953
2,085
Pension Cost Overview
Liabilities Cost
View and adjust membership level information to see impact on the liability and costs
7
Govin
r
Miscellaneous
Safety
Me rrtber
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UNFUNDED LIABILITY
41(4‘ CONTRIBUTION
EM P LOPE R NORMAL COST
EMPLOYEE CONTRIBUTION
Year: 2016 Employer NormaI Cost: $6.67M 1121% Total Employer Contribution: $13.73M 126.1%
611
2.01
320
953
2,085
U
Pension Cost Overview
Liabilities Cost
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8
PLANS & TIERS
0 Ivliseellaneous
0 Weil'
ADJUST ASSUMPTIONS AN D VARIABLES
Years Projected
Discount Fate V
1
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7-5
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0 FUNDED RATIO
77.7%
50_056
25_'}'6
Year: 2015 Funded F t1o: 77.7%
Funded Ratio
Lta b1 Httes Cost
2007 2008 2009 2010 2011 2012 2013 2014
Valuation Date As Of
Year 0FUNDED RATIO
2007 1012
2008 89.4%
2009 60.6%
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2015
2016 2017 2018 2019 2020
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9
PLANS Si TIES
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AVERAGE INVESTMENT
0 RETURN
za_
1a_
O_
1
CAPERS Assumed Rate erf Return: 7
5 1C
AVE I GE INVESTMENT
Year 0 RETURN
I 13.2%
V
3.5%
1C 7.
CalPERS Investment Rctum A naly5 is
Stay on top of CaIPERS investment returns and provide context for their assumptions
Liabilities Cost
10
1
4
PLANS &TIERS
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:ii 0
0 AC1lVEMEMDERS 0 TRANSFERRED MEMBERS 0 SEPARATED MEM BERS 0 RETIRED MEMBERS
2.0 K.
1.5 K
1.0V.
_O
0.0
il
Demographic Analysis
Liabilities Cost
1.
2010 201: 2012 2013 2014 2015 2016 20t7 2018 2019 2020
F ACTIVE MEMBERS
2010 6Th
2011 648
2012 614
r•r.r
•J V
31
2 11
TFPAINIS FER R ED MEMBERS0
Valuation Date As Of
SEPARATED MEMBERS
194
0 RETIRED MEMBERS
947
203 965
201 918
Track how your agency's workforce will change over time and how that will impact your costs
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PLANS &TIERS
Q WJ
0 Miscellaneous
0 SafetY
ADJUST ASSUMPTIONS AND VARIABLES
Years ] ected
Discount Rate ).
Salary I r7 ase ( )
Amortization Period (Yerse
Lure Suri Payment C M
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&LV5IS
5
7.5
3
30
0
. 1 1 ei-ea
TOTAL EMPLOYER LUMP SUM FREPAYMENT
CONTRIBUTION 0 OPTION
$14.451v1
.12_50M
Lump Sum Prepayment Option vs. Periodic Payroll Payme
Year: 2015 Lump Sum Prepayment Option: : 14-5 M Amount Saved: $531.90K
.10_GOM
S7.50M
.5_ r,
52.50M
.
20109
ill
i
Oa b1Iit1es Cost
201Q 2C11 2012 201 2014 2015 2026 2 317 2018 2019 2020
For Fiscal Year Beginning
TOTAL EMPLOYER LUMP SUM PREPAYMENT
Yea
r' CONTRIBUTION 0 OPTION
21009 $11.811v1 $11.39M
2010 $11..84M $11.42M
2011. $13.75M $13..271.01
Weigh different funding solutions and their potential cost -savings
12
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Success
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4sok Govinvest
loi
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increased accountability, and improved governance.
13
RESOLUTION NO. 2017-158
A RESOLUTION OF THE LODI CITY COUNCIL AUTHORIZING THE
CITY MANAGER TO WAIVE THE BID PROCESS AND EXECUTE A SOFTWARE
AS A SERVICE AGREEMENT WITH GOVINVEST, INC., OF TORRANCE, FOR
PENSION TOTAL LIABILITY CALCULATOR SOFTWARE SERVICES, WITH AN
OPTION TO PURCHASE THE OTHER POST EMPLOYMENT BENEFIT
TRANSPARENCY TOTAL LIABILITY CALCULATOR SOFTWARE
WHEREAS, the City's Unfunded Accrued Liability (UAL) on its pension plans with
CaIPERS are the foremost financial concern facing the City; and
WHEREAS, the UAL problem is complex and involves discussions with a myriad of
interest groups with different viewpoints and understanding of the current situation; and
WHEREAS, having simple to read, simple to understand, and simple to adjust reports is
critical to engaging in multiple discussions on the UAL funding issue; and
WHEREAS, Govinvest is a sole -source provider whose product is unique in displaying
pension -funding information, including scenario analysis, at a granular and summary level, in a
simple to understand format to allow for discussions with any interest group; and
WHEREAS, Govinvest offers a similar product for Other Post Employment Benefit
(OPEB) total liability calculations that is similarly unique; and
WHEREAS, per City of Lodi Municipal Code Section 3.20.070, the City Council finds it is
in the City's best interest to dispense with bidding and procure this software service directly with
Govinvest; and
WHEREAS, staff recommends the City Council authorize the City Manager to execute a
Software as a Services Agreement with Govinvest, Inc., of Torrance, for pension liability
calculator software services in the amount of $45,750 and grant the City Manager authority to
activate the OPEB transparency total liability calculator software in the amount of $32,500 at the
City Manager's discretion.
NOW, THEREFORE, BE IT RESOLVED that the Lodi City Council does hereby
authorize the City Manager to:
1. Execute a Software as a Services Agreement with Govinvest, Inc., of Torrance,
California, for pension liability calculator software services in the amount of $45,750 for
the five-year term of the agreement; and
2. Activate the Other Post Employment Benefit Transparency Total Liability Calculator
Software in the amount of $32,500 for the five-year term of the agreement at the
City Manager's discretion.
Dated: August 16, 2017
I hereby certify that Resolution No. 2017-158 was passed and adopted by the City
Council of the City of Lodi in a regular meeting held August 16, 2017 by the following vote:
AYES: COUNCIL MEMBERS — Chandler, Johnson, Mounce, Nakanishi, and
Mayor Kuehne
NOES: COUNCIL MEMBERS — None
ABSENT: COUNCIL MEMBERS — None
ABSTAIN: COUNCIL MEMBERS — None
0--ThT[r\?reA/Ukti
ENNIFER . FERRAIOLO
City Clerk
2017-158