Explanation
Background
The City of Columbus, Department of Finance and Management entered into a contract with Arthur J. Gallagher Risk Management Services, Inc., as authorized by Ordinance No. 0943-2009, passed on 07/8/09 to provide insurance brokerage and risk engineering services for the city's insurance programs for a five year period, consisting of an initial one-year term and four automatic consecutive one-year terms, each subject to appropriation of necessary funds by City Council and certification of availability of funds by the City Auditor. The fourth and final one-year renewal term terminates on July 31, 2014.
The Department of Finance and Management had planned to solicit Request for Proposals for insurance brokerage and risk management services in April, 2014. However, due to the significant water intrusion event that occurred in the 120 Marconi Boulevard building on January 7th & 8th of 2014 and the resultant insurance claim to be settled, it is not in the city's best interest to change insurance brokers until this claim is satisfactorily resolved. Consequently, the Department of Finance & Management desires to extend the existing Insurance Brokerage and Risk Engineering Services contract with Arthur J. Gallagher Risk Management Services, Inc. for a one-year term for the period August 1, 2014 to July 31, 2015 under the same terms and conditions of the original contract. The Department of Finance and Management plans to solicit Request for Proposals for the city's insurance brokerage and risk management services in early 2015.
This ordinance authorizes the Director of Finance and Management to execute those documents necessary to extend the Insurance Brokerage and Risk Engineering Services contract with Arthur J. Gallagher Risk Management Services, Inc. for a one-year term for the period August 1, 2014 to July 31, 2015; to bind coverage for all city 2014-2015 insurance programs; and, to expend up to $406,000 from the Department of Finance and Management 2014 Budget and to expend up to $145,700 from the Department of Public Safety, 2014 General Fund Budget. This ordinance also authorizes the Director of Finance and Management to approve any necessary changes in the city's insurance program, such as additions of buildings, aircraft, vehicles, modify coverage limits, and additions to type or lines of coverage during the 2014-2015 policy term.
The contract compliance number for Arthur J. Gallagher Risk Management Services, Inc. is 36-2102482 with an expiration date of March 7, 2016.
Fiscal Impact: The funding for this contract extension and all insurance premiums is budgeted and the funds are available within the Department of Finance and Management 2014 Budget and the Department of Public Safety 2014 General Fund Budget. This ordinance authorizes the expenditure of up to $551,700 for premiums and brokerage fees associated with insurance coverage necessary to protect city assets.
Emergency action is requested to allow for uninterrupted insurance brokerage services for the city's insurance coverage for the insurance year 2014-2015 for property, boiler and machinery, general liability, and aviation insurance.
Title
To authorize the Director of Finance and Management to extend the contract with Arthur J. Gallagher Risk Management Services, Inc. for a one (1) year term; to bind the city's insurance for the term commencing August 1, 2014 and terminating July 31, 2015; to authorize the expenditure of up to $551,700.00; to waive competitive bidding provisions of the Columbus City Codes; and to declare an emergency. ($551,700.00)
Body
WHEREAS, pursuant to Ordinance No. 0943-2009, the City of Columbus entered into an Insurance Brokerage and Risk Engineering Services contract with Arthur J. Gallagher Risk Management Services, Inc. for a five year period with an initial one (1) year term and four (4) automatic consecutive one-year renewal terms with the fourth and final one year renewal term expiring on July 31, 2014; and
WHEREAS, the Department of Finance and Management has deemed it is the city's best interest to extend the Insurance Brokerage and Risk Engineering Services contract with Arthur J. Gallagher Risk Management Services, Inc. for a one-year term from August 1, 2014 to July 31, 2015; and
WHEREAS, this ordinance requests a waiver of competitive bidding requirements, in accordance with Section 329.27 of the Columbus City Codes; and
WHEREAS, it is necessary to authorize the expenditure of funds for insurance brokerage and risk engineering services contract with Arthur J. Gallagher Risk Management Services, Inc. for the one (1) year term commencing August 1, 2014 and terminating July 31, 2015; and
WHEREAS, it may be necessary for the Director of Finance and Management to make changes in the city's insurance program to modify coverage limits, insure additional buildings, aircraft, vehicles, add types or lines of coverage which may result in additional premium costs during the 2014-2015 policy term due; and
WHEREAS, an emergency exists in the usual daily operations of the Department of Finance and Management in that it is immediately necessary to authorize the expenditure of funds for insurance brokerage and risk engineering services for the city's property, boiler and machinery, general liability, and aircraft insurance programs including the underwriting cost of the city's selected insurance policies for property, stored vehicle, boiler and machinery, general liability, and aircraft insurance to ensure that coverage continues without interruption thereby preserving the public health , peace, property, safety and welfare; now, therefore:
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
SECTION 1. That the Director of Finance and Management be, and hereby is, authorized to execute those documents necessary to extend the Insurance Brokerage and Risk Engineering Services contract with Arthur J. Gallagher Risk Management Services, Inc. for a one-year term for the period August 1, 2014 to July 31, 2015 under the same terms and conditions.
SECTION 2. That in accordance with Section 329.27 of the Columbus City Code, City Council has determined that it is in the best interest of the City of Columbus that Section 329.06 relating to formal competitive bidding requirements be waived and hereby waives said section.
SECTION 3. That the Director of Finance and Management be and is hereby authorized and directed to pay contract costs for the extension of the contract with Arthur J. Gallagher Risk Management Services, Inc. to provide insurance brokerage and risk engineering services, for select city properties, property (casualty), boiler and machinery, general liability, and aviation insurance premiums and to make any necessary changes in the city's insurance program required during the 2014-2015 term and pay the associated costs of any additional insurance premiums incurred.
SECTION 4. That the expenditure of $551,700.00 or so much thereof that may be necessary in regard to the action authorized in Section 1, be and is hereby authorized and approved as follows:
Department/Division: 45-51
Fund: 502
OCA Code: 450052
Object Level 1: 03
Object Level 3: 3392
Amount: $406,000.00
Department/Division: 30-03
Fund: 010
OCA Code: 300707
Object Level 1: 03
Object Level 3: 3392
Amount: $145,700.00
SECTION 4. That the City Auditor is authorized to make any accounting changes necessary to ensure that this contract is properly accounted for and recorded accurately on the city's financial record. That the City Auditor is authorized to make any changes to revise the funding source for any contract or contract modification associated with this ordinance.
SECTION 5. That for reasons stated in the preamble hereto, which is hereby made a part hereof, this ordinance is declared to be an emergency measure and shall take effect and be in force from and after its passage and approval by the Mayor, or ten days after passage if the Mayor neither approves nor vetoes the same.