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HomeMy WebLinkAboutC28570 - Post-Disaster FEMA Grant Mgmt Contract No. C28570 �-�--� CITY OF PALM DESERT � � DEVELOPMENT SERVICES STAFF REPORT REQUEST: Approve On-Call Professional Services Contract with Adjusters International, Utica, New York, for Post-Disaster FEMA Grant Management SUBMITTED BY: Gary Rosenblum, Risk Manager DATE: February 12, 2009 CONTENTS: Adjusters International Proposal Recommendation: By Minute Motion: Approve on call contingency professional services contract with Adjusters International (AI), Utica, New York, for FEMA grant management consulting. Executive Summary: This is a no-cost non-bindinq continqency contract that locks in the consultant pricing for three years and puts the City first in line to acquire as much consulting services as we request. It does not give AI an exclusive contract with the City, and it does not incur any cost until the City calls for the services in a post-disaster situation. The agreement serves as a no-cost retainer for three years. This consulting service is of critical importance to maximize FEMA recovery after a significant disaster because the City is 100%self insured for earthquake property damage (currently valued at$156 million), and FEMA recovery is the only source of funding to reimburse the City for direct property losses. Discussion: This is a non-bindinq continqencv contract. It establishes a contingency relationship with AI in advance of a disaster. This is so that the City does not need to try to contact them and establish a contractual relationship after the disaster when every other government entity is seeking the same assistance. It simply locks in today's consultant pricing and puts the City first in line to acquire as much consulting services as we request. AI provides only the contract services we request at the time of the disaster. It does not give AI an exclusive contract with the City, and it does not incur any cost until we call for the services in a post-disaster situation. The City is free to use the services of any other available contractor, if it desires, although AI would be the contractor of choice, as explained below. The agreement serves as a no-cost retainerforthree years, and locks in the consulting fees at the contractual rate for the three years. It also includes annual Staff Report Professional Services Contract with Adjusters International Page 2 of 2 February 12, 2009 free training classes for our personnel in managing FEMA grant programs. There is no cost until the services are rendered at the time of the disaster. Once the costs are incurred, some portion of AI fees may also be potentially recoverable from FEMA. FEMA grant programs are of critical importance to the City because the City is 100% self insured for earthquake damage recovery. The value of City property is currently approximately $156 million, which includes City Hall, the Corporation Yard, the Visitor Center, Henderson Building, Desert Willow, and all RDA housing. Self insured means that the City will be paying for all repairs and recovery out of reserves or other means such as lines of credit. Therefore, FEMA recovery must be considered the City's earthquake insurance. FEMA will, upon submission of appropriate paperwork, potentially reimburse the City for a substantial percentage of property repair and recovery, and the City's e�raordinary personnel costs. The City's claim with either FEMA or the state through the California Disaster Assistance Act could be tens, possibly hundreds of millions of dollars. The City will have 60 calendar days from the Federal declaration of disaster to complete the damage and cost recovery applications to FEMA. All FEMA recovery will be based on the 60-dav submission. There are no post-deadline submissions allowed, nor are major changes or additions allowed by FEMA. Therefore, the 60-day FEMA submission is the critical step in the post-disaster financial recovery, but it takes place during the time when, due to the disaster, City personnel and City infrastructure are at its most stressed, and it is most difficult to track expenditures, personnel time, determine rebuilding costs. This contract with AI will enable us to receive substantial assistance in this critical financial recovery process. AI is one of the most experienced FEMA recovery consultants to government entities in the United States with extensive experience with 9/11, hurricane and flood di a te s (s e attached). This contract is to insure that the City, if necessary, has acc ss t a u h consulting needed to make as full and correct FEMA application as possi le I ill al o assist in the ongoing process that could take years to fully recover the FEM g a t n i g. Submitted By: Depart t ead: C� ""; Z J w Gary Rosenblum Homer Cro � �' � � Risk Manager ACM for Development Se�ic s 'Y i �- �, U ApprovaL c � ' _ V • s � � � w ', � '3 J in cCarthy Paul Gibson ~ F � p �" ; terim ity Manager Director of Finance � � � � c � a GC � '� FZw o � , E.,, Z e�,G;,, � �- "x L'" ✓% � W E-� -■ � ^.�, U �= c=; � ✓� v� z '� CrQt� � Q � QQ > O . ADJLTSTERS INTERNATIONAL CH Corporate Office 12fi Bu�incss Park llri��c Utica,New Yurk 13502 1-SO(1-382-2468 Oiitside the U.S.:(315)-797-3035 Fax:(315)-797-1090 January 14, 2009 Gary Rosenblum Risk Manager City of Palm Desert Subject: Proposal for On-Call FEMA Grant Management and Insurance Adjusting Services Dear Mr. Rosenblum: Thank you for allowing Adjusters International ("AI") to submit this proposal for on-call FEMA Grant Management and Insurance Adjusting Services to City of Palm Desert ("City"). This proposal document, dated January 14, 2009, when executed by both the City and Adjusters International, will serve as a retainer agreement for a period of three years. In the event, during the three-year period, the City has a federally declared disaster or suffers an insured loss, the City, at its sole discretion, can activate Adjusters International subject to the terms of this agreement to perform some or all of the following tasks: Approach and 5cope of Work FEMA Public Assistance Consulting Services AI will provide the City with services designed to help maximize FEMA funding, expedite the process, and retain funds during project closeout and audit. The following bullets present the services that are available under this engagement. Grant Management Tasks: • Provide general grant management advice • Assist in the development of a disaster recovery team • Assist in the development of a comprehensive recovery strategy • Provide advice to disaster recovery team as appropriate and participate in meetings • Prepare draft correspondence to State and FEMA as necessary Eligibility Tasks: • Review eligibility issues, and work with City to develop justifications for presentation to FEMA and the State u�w�i•v.adiustersinternaHonal.com Adjusters International Proposal for On-Call FEMA and Public (Insurance) Adjusting Services Page 2 • Assist City in developing approach to filing and tracking costs • Review contracts and purchasing documentation • Review documentation prepared by departments • Assist in capturing and summarizing eligible costs for selected departments • Assist City departments with compiling and summarizing Category A through G costs for presentation to FEMA and the State • Assist City to prepare Project Worksheets for small and large projects based upon information provided by departments • Attend meetings with City, State and FEMA to negotiate individual Project Worksheets as needed • Provide oversight to departments having difficulty with their claims • Assist in determining if any eligible damages have not been quantified and presented to inspectors/Project Officers • Work with City to resolve disputes that may arise • Address issues related to inter-agency funding conflicts • If City disagrees with FEMA determinations, assist to strategize and write appeals • When City has completed all projects and drawn down reimbursement for all eligible costs, assist with finalizing preparations for State/FEMA final inspections and audits, and participate in exit conferences with State/FEMA Engagement Management Tasks: • Prepare program management plan • Prepare weekly reports • Attend status meetings Because of the nature of federal funding, AI can make no guarantees concerning the amount of funding the City will receive from FEMA. Staffing An assigned project manager will serve as engagement leader and perform the tasks outlined above, taking direction from City's designee. Other AI consulting staff will provide support as required. Insurance Adjusting Services Property Damage: Building • Investigate and analyze all "on-site" property damage to the building • In accordance with policy requirements, prepare details of the loss, using replacement costs and actual cash values where applicable • Calculate appropriate depreciation where necessary Adjusters International Proposal for On-Call FEMA and Public(Insurance) Adjusting Services Page 3 • Prepare all valuations necessitated by coinsurance provisions (if required) • Prepare a concise, detailed, well-documented claim • Recommend to management actions that will mitigate the loss Contents & Stock • Investigate and analyze all "on-site" property damage to the contents, including stock, supplies, furniture, fixtures, machinery, equipment, improvements and betterments, computer systems, etc. • In accordance with policy requirements, prepare details of the loss, using replacement costs and actual cash values where applicable • Calculate appropriate depreciation when necessary • Prepare all valuations necessitated by coinsurance provisions (if required) • Prepare a concise, detailed, well-documented claim Time Element Coverage: Business Interruption (if applicable) • Advise management on how to start collecting and developing information (e.g., track impact of loss through the general ledger accounts for extra costs, inefficiencies of operation and payroll for those not working) • Determine the appropriate period of suspension, total ar partial • Determine sales projected or the sales value of production • Determine cost of sales/production in compliance with insurance policy definitions • Determine claim limitations (actual loss sustained) • Determine and evaluate discontinued (saved) expenses • Determine expediting expenses; expenses related to reducing the loss • Instruct management on actions that will mitigate the loss • Determine values for coinsurance compliance (if necessary) • Prepare financial projections for the period of suspension and perhaps beyond • Prepare for submission a business interruption valuation claim, supported by multiple schedules • Provide total business interruption claim management to ensure consistency with the property portions of the claim Extra Expense • Analyze and advise management on extra expenses that are necessitated and recoverable under the insurance provisions • Coordinate tracking ar extra expense items to ensure collect ability • Determine excess expenses over normal expenses Adjusters International Proposal for On-Call FEMA and Public (Insurance) Adjusting Services Page 4 • Continue to track recoverable extra expenses during an extended period of indemnity, if available under the insurance program • Integrate the extra expense claim with the property damage claim • Present and support the claim Staffing An assigned Senior Adjuster will serve as engagement leader and perform the tasks outlined above, taking direction from City's designee. Other AI staff including estimators and inventory specialists will provide support as required City Responsibilities To assist us in completing the various work tasks described, if activated, the City may need to assemble and provide the following information and resources: • A central contact person • A City organization chart, together with a list of names, roles, and phone numbers of personnel involved in FEMA grant management/insurance claim(s) • Access to all relevant disaster-related files and insurance policies • Access to knowledgeable individuals who can answer questions and assist in obtaining additional information, including engineering staff, finance staff, accounting staff, and grant management staff • Available written explanations of how City calculates its fringe benefit and indirect cost rate • Sample cost summaries • Written grant management guidelines and other correspondence from the State or FEMA • A work area, such as a conference room, including access to phone, internet, and copier COMPENSATION The City shall pay the Consultant according to the following Compensation and Schedule FEMA Consulting AI proposes to perform all FEMA consulting engagements on a time-and-expense basis, which is invoiced monthly. AI's compensation will be a function of the type of expertise provided to the City based on the tasks requested by the City and as generally outlined under this proposal. Adjusters International Proposal for On-Call FEMA and Public (Insurance) Adjusting Services Page 5 The following table presents Adjusters International's FEMA consultation fully burdened rates, including airfare,by position for representing the City as an Applicant. Hourly Rate Senior Consultant $295 Consultant/Project Officer $165 Specialist $13 5 Professional fees will be invoiced on a monthly basis. Because of AI's timekeeping system, some invoices may be for periods of less or more than thirty days. As this is a time-and-expense engagement, the City has the ability to decide which tasks AI will assist them with. Consequently, the overall cost of this engagement is at all times subject to the City's desired level and length of AI's service. AI will provide weekly progress reports to the City as appropriate. These reports will serve as the support for bi-weekly progress invoicing. Public Adjusting AI proposes to provide public adjusting services on a contingency basis. The benefits to the City of using an incentive-based fee are (1) there are no out-of-pocket expenses, thereby increasing cash flow at a time when revenues are reduced, and (2) it allows our team to earn our fees based on our success. Our fee for service is 10 percent of the net recovery after deductible(or a negotiated stepped fee). AI will absorb all expenses related to the preparation and presentation of the claim. This does not include any legal fees, should they become necessary. Our fee is due when the insurance proceeds are received by the City. Thank you again for this opportunity to assist the City. If you have any questions or concerns,please contact me at 315-415-2963 (mobile). Sin rely, ' AGREED TO AND APPROVED BY . , a�----`—'_ ohn Marini PRINTED NAME: hief Operating Officer Vice President, Sales & Marketing SIGNATURE: TITLE: DATE: Adjusters International � Company Background 8c Experience 800.382.2468 Our leadership position within the field of post-disaster financial recovery arises from our ADJUSTERSI NTER NAT IO NAL.COM company's founding 24 years ago as the nation's premier public adjusting organization, guiding clients to maximize and expedite their property insurance claim settlements. Our reputation for strategic thinking and effective management of the total financial recovery process has gained us experience on some of the most challenging and high-profile losses of the past two decades. On this foundation of excellence and client advocacy, we have built our reputation over the last 13 years in the area of the FEMA Public Assistance Program. Our initial introduction to the FEMA grant process occurred when we were hired in 1996 by the City of Harrisburg, Pennsylvania, to guide the city through their FEMA Public Assistance grant program for a flood disaster. Since that time, our client base of FEMA grant applicants has grown to include high-profile names, such as the Port Authority of New York and New ]ersey(owners of the World Trade Center), whom we guided through their FEMA Public Assistance grant application following 9-11 (citations are included with the References under Tab 3). The City of New Orleans turned to Adjusters International in 2006 to untangle their FEMA and insurance recovery issues and the City of Cedar Rapids, Cedar Rapids School District, and Linn County, IA requested our assistance in guiding them through their recovery from the June 2008 Midwest floods. We have assisted with recoveries that required extreme flexibility, technical expertise, and the ability to mobilize quickly. We are under contract to provide dedicated public assistance support staff to the states of Massachusetts and New York (we are currently responding to our thirteenth disaster in four years for New York). We also enjoy long- standing emergency standby relationships with Monroe County in Florida (since 1998), and the Houston Independent School District in Texas, as well as more recent standby agreements with Lee County, Pinellas County, City of Plantation, Key Biscayne, City of DeBary, and University of Miami in Florida, and Chatham County and Garden City, Georgia. Our expertise has allowed us to work on behalf of clients such as the Government of Kuwait, assembling and documenting their United Nation's War Reparation claims; the Port Authority of New York and New 7ersey following the bombing of the World Trade Center in 1993, and the Governor of Oklahoma after the bombing of the Murrah Federal Building to quantify and document all related damages to the City. We have assisted numerous Gulf Coast clients following the 2005 and 2008 hurricanes, including the City of Slidell (LA), New Orleans Sewerage and Water Board, Bay St. Louis— Waveland School District(MS), Port Arthur Independent School District(TX); Hancock(MS),7ackson (MS), Harrison (MS) and 7efferson (TX) counties; the port authorities of New Orleans, Pascagoula, Port Arthur, Port Freeport and Gulfport; the Mississippi State Coliseum; school districts in Texas including Houston Independent School District,Aldine Independent School District, Weslaco Independent School District; and numerous cities, hospitals, and universities. In addition to our experience assisting clientele throughout the world with disasters of all types and magnitude, Adjusters International has extensive familiarity with recovery operations in Texas. We have been guiding Texas clients through their insurance and FEMA recoveries from previous disasters including the 2005 hurricanes, 2007 floods, and 2008 hurricanes. This involvement provides us with a strong understanding of ever- changing FEMA policies and the local needs of insureds and Applicants in Texas and the entire Gulf Coast region. We are able to bring this up-to-date knowledge to the City of Palm Desert to ensure maximum reimbursement. �QADJUSTERS INTERNATIONAL The right course for recovery Disaster Recovery Operations � Adjusters International Has Supported Since 1996: soo.ss2.2ass Applicants: Port of New Orleans,Louisiana ADJUSTERSINTERNAT14NAl.COM Aldine Independent School Port,Texas Port of Port Arthur,Texas Audubon Nature Institute,Louisiana Philadelphia School Port,Pennsylvania Associated Hospital Services,Louisiana Redland Christian Migrant Association,Florida City of Batesville,Arkansas Reno,Nevada Baylor College of Medicine,Texas Rocky Mount Charter School,N.Carolina Butte County,California City of Sanibel,Florida City of Burlington,lowa Seminole County,Florida Cedar Rapids Community School Port,lowa City of Slidell,Louisiana City of Cedar Rapids,lowa Sparks,Nevada City of Copperas Cove,Texas Syracuse,New York City Park of New Orleans,Louisiana St.Luke's Episcopal Health System,Texas Coryell County,Texas Sewerage&Water Board of New Orleans, Council Bluffs,lowa Louisiana City of DeBary,Florida Texas Energy Cooperative,Texas Detroit Public Schools,Michigan Thermal Energy Cooperative(TECO) Detroit,Michigan University of Virgin Islands,U.S.V.I Fort Collins,Colorado Washoe County,Nevada City of Fort Myers,Florida City of Waterbury,Connecticut Gettysburg,Pennsylvania Waveland-Bay St.Louis School Port, Government of the U.S.V.I. Mississippi Greenville Housing Authority,N.Carolina West Jefferson Medical Center,Louisiana Greenville Utility Commission,N.Carolina City of Weslaco,Texas Grifton,N.Carolina City of Weslaco Independent School Port, Hancock County,Mississippi Texas Harbor Branch Oceanographic,Florida Harrisburg,Pennsylvania New York State: Holy Cross Hospital,Florida 1391-DR 9-11-01 September 11,2001 Houston Independent School Port,Texas 3195-EM-NY Snow Emergency 2004 Islamorada,Village of Islands,Florida 1534-DR-NY Severe Storms and Flooding Jackson County,Mississippi 1564•DR-NY Severe Storms and Flooding Jackson County Port Authority,Mississippi 1565-DR-NY Tropical Depression ivan Jackson Energy Authority,Tennessee 1589-DR-NY Severe Storms and Flooding Jefferson County,Texas 1650-DR-NY Severe Storms and Flooding Jefferson Parish,Louisiana 3268-EM-NY Snowstorm Knapp Medical Center,Texas 1665-DR-NY Snow Emergency Larimer County,Colorado 1670-DR-NY Severe Storms and Flooding Las Vegas,Nevada 3273-EM•NY Snow Lee County,Florida 1692-DR-NY Severe Storms and Inland and Linn County,lowa Coastal Flooding Little Rock,Arkansas City of Marble Falls,Texas Maui County,Hawaii Monroe County,Florida Monroe County Sheriff,Florida Memorial Hermann Health Care System,Texas Mississippi State Port Authority,Mississippi Nashville,Tennessee City of New Orleans,Louisiana Onondaga County,New York Philadelphia Public Schools,Pennsylvania Port Arthur ISD,Texas Port Authority of New York 8�New Jersey City of Pascagoula,Mississippi Pitt County,N.Carolina Pittsburgh,Pennsylvania �=ADJUSTERS INTERNATIONAL T'he rioht course for recoverv"