Travis County Commissioners Court
December 12, 2006
Item 19
19 is to discuss and take proant action on the following deferred compensation committee recommendations. 19-a, a contract award with ongses to renew for deferred compensation 457 b plan administration to nationwide retirement solutions. B, contract renewal with the retiernlt store to provide plan advice and expertise to the Commissioners court and the committee on derd compensation 457 plan b and related issues. C is release of a request for proposal for deferred compensation plan administrative services. D is did designation of deferred compensation committee for plan oversight. A is the contract award.
>> judge, comuftders, two weeks ago we brought before you the deferred compensation committees report on the analysis of the current plan to administer through nationwide insurance company. There were several findings, and just to reiterate, two of them the negotiations ended up with mutual fund participants getting a reduced fee. The administrative fee was removed, but all other fees remain. The fixed asset account participants really had no change. Right now they're earning 4.05 percent interest, and we find that we were unable to really negotiate a better deal on that because the market value adjustment amount of about $200,000 that would have to be paid if we changed administrators. The committee felt strongly that as a goal the county should have -- to eliminate the market value adjustment once it drops down below a reasonable amount, which would be around $50,000. The committee worked very hard to bring a better plan and to get the best plan possible. I think we're bringing to you the best plan possible with nationwide insurance, so a recommendation in a is to award a contract with option to renew for deferred comp plan administration to nationwide insurance. Now, there's two ways to handle the contract duration. One is a one-year contract with annual newells or year to year contract with automatic renewals. That would be two options for you to choose one. If the contract is approve.
>> the way the clause is written on term of agreement, it says the county has the option to extend this agreement for additional one-year periods on such further terms and conditions as are negotiated at the time of exercising any ongses. -- options.
>> sid, can you give me a perspective from purchasing point of view in terms of work load, differences between a and b of something that's a year contract with an annual renewal versus a year to year with automatic, which has more flexibility, more flexibility, less work load, more work load from the purchasing office perspective?
>> obviously one that renews from year to year is less work because it automatically renews unless we do something, unless the contract is written to where we have to do a written modification even if it automatically renews. A lot of our social services contracts automatically renew, term contracts. So any time we have to actually do a physical mod, it's more work. I believe the way that this is written, it automatically renews unless we do something different. One of the clauses that we normally have in our contracts has to do with contract amendments and it talks about how those are processed through the purchasing office. That clause is not in here. I've talked to my staff who has talked to barbara this morning about it, and that's something that perhaps we should include in this contract. And maybe barbara should answer the question on how this term of agreement -- she wrote it how she thinks that it reads and what it means contractually and how each year that would be renewed. Is it automatic?
>> it is not automatic. It requires the court to approve an option to extend, to exercise the option to extend. The reason that that was done as opposed to an automatic renewal is because as the people who have established this plan, the court has a fiduciary duty. That means a duty to act as a prudent and reasonable person in the way that you make decisions about what should be happening within the plan. It seems that a prudent and reasonable person would take an active look at the administrative agreement once a year in order to evaluate whether it is in fact doing what the court wants it to do. It gives the court the option to say, yes, we like what's happening. It doesn't allow the court to forget about the contract and not even evaluate what has happened during the past year because you at least have to do that, go forward with it instead of it being on a list of 86 to 125. Other contracts where there are all automatic renewals and we're just telling you that this is an automatic renewal. 'It's on an agenda item with all other 86 ones. It just seemed that because we do that higher duty of care that it was reasonable not to make iting in something that could just slip by and make it something where you make an affirmative action once a year to look at it and say this is what we want to continue or we want to look elsewhere and see whether this is what he want to continue. It does not in any way require you to do anything more than saying we're happy, we want to go forward.
>> what's the committee recommendation?
>> the committee recommendation is to award a one-year contract. We debated this long and hard over a six-month period as part of the negotiation s to reach the compromises we did reach was the one-year contract period.
>> the option to renew --
>> with the option to renew.
>> which we proactively called it up and renew it, so we take the automatic nature away.
>> that's correct.
>> it does not renew automatically, we would have to renew it.
>> and as barbara said, that would be part of the fiduciary responsibility.
>> I neff thought that we would go -- I never thought that we would go through everything that we've gone through and all of a sudden it's a one-year contract and the company is not even been given the opportunity to perform under the initial year. I mean torks me it's like all this work and we're only getting a one-year contract? That's not how we deal with a lot of our professional services in terms of establishing a relationship.
>> the other issue -- and I was not on the committee, although at some point I attended some of the meetings. I disagree with the committee on it. I think it should be an automatic renewing contract, look at it once a year and make a decision whether we want to continue. I'm not sure that nationwide understood too that it was just going to be a one-year contract, but I don't know about that.
>> [overlapping speakers]. The other issue is for the employees. This whole year -- and it's well documented all the things that will have to happen this new year that they're going to be doing, we'll get six months, eight months into it, everyone has been counselorred, everyone has changed into new plans and then what happens to those people who have invested in long-term plans, and there's a threat that we might change providers. I think that's been a concern of employees. What's going to happen to my money if we do change plans.
>> but if we do the one-year option to renew, can we make it effective January 1 of 2007, the one year expires one year later?
>> actually, what the contract says now is that it would be effective on the day that it was approved by the court, which is today if you were to approve it today, so it's only two weeks before January 1. But the reason for that was to get the reporting in place and to have the financial -- certified financial planner be able to be prepared and that sort of thing. The fact is that when it comes to moving from the current plan to the new investment, that won't be done before February the 23rd because that's as fast as they can do it considering the sec requirements, the requirements that the securities and exchange commission, federal securities and exchange commission, puts on them in terms of notifying people and letting them know what's happening. And so if we push the effective date, all it would mean is that we have less reports for the county?
>> the problem I have with it automatically renewing is if we're not careful it will be 10 or 15 more years before this comes up. If it renews annually, we will be forced to make a call and I have no reason to think that after the first of the year we won't renew it one year more, but if there's a reason not to, there's a reason to look at those reasons, we need to negotiate with nationwide and take it from there.
>> when I heard the testimony, from what I heard last week, from what I heard from nationwide, kind of encowrnld, didn't disagree with looking at this on a year to year base. That's what I understood. I believe when we actually look at this for what it is, I think by having something that comings up ef year without automatic renewal, we'll have a leverage I think to make sure that they perform and provide the best end result to the employees of Travis County. An example, we got a lot of things that we didn't know was available to us until nationwide was put to the test and other persons maybe wanting to deal with this particular situation, and we end up -- nationwide saying we can do better than what we're doing, and as an end result we got a lot of things that I didn't think we would get as far as the benefits that go to the Travis County employees who have invested money over the years into this particular organization. So I think we need to put the pressure on them. Maybe we can squeeze some more benefits out of these folks that would be beneficial to to the Travis County employees, especially if they know that we aren't just going to just nod and give you a push along the way and say, hey, this is automatically coming, you automatically get what's coming to you year after year. I think they need to be continually scrutinized to the point whereby we can make sure that the benefits to Travis County investments the employees of Travis County is paramount, at the top of the pyramid. So that's my concern is to make sure we keep the pressure applicable to nationwide as we go through this process. There's probably one way to do that, let them know that there's no guarantee that you will be looking at us the next year if you don't do what you're supposed to do best for the interest of Travis County investors. So that's what I'm looking at.
>> move that we approve 19-a with an option to renew, but not automatically.
>> I second that.
>> I understand this to be staff's recommendation, that's the motion. Commissioner Davis seconds the motion.
>> in section 8.6.5, there is a clause that says that nationwide will inform participants of transaction issues via personalized mailing approved by the county no later than December the 15sth. I spoke with nationwide this morning and asked them if they would be able to meet that. And since this has been delayed several weeks they do not believe they will need that. I don't want them to start off in breach of the contract with this date.
>> 31st of December?
>> that's fine, because it was intended to be two weeks after.
>> okay. I will make that change from December 15th to December 31st.
>> we're still partners of how we're standing in the committees.
>> just a question and let me know if -- it has to do with I can go with the one-year with the annual one-year, but I think it is unbelievably important to allow this official to have one year to perform without the threat that in six months they're going to have to be running for reelection while they are still trying to perform the initial six months. So I think they ought to have that there would not be any kind of an r.f.p. During this initial year. They ought to have a full 12 months to make the change, perform and appropriately this Commissioner's court would evaluate that and move on from there. But I just -- I just don't think it's fair that the threat of an r.f.p. Ought to happen within the first year of this contract change.
>> I'm with nationwide and I think that's an enhancement that we're asking, we'll nightbeat need at least a year before the enhancements to be active. And kim will be implementing all the enhancements. And also with the mapping of the new funds, which will take place in February. It's a process, judge. We would appreciate that.
>> judge, the issue of one year gives Travis County some leverage and the ability to go out on the r.f.p. Should the market value adjustment drop, but nationwide not be willing to element the market value adjustment, that's the crux of why we did not get a better deal for the fixed account investors.
>> you're acting as though the fixed account is the only thing out there and the market value adjustment is the only thing out there. And it is going to take unbelievable time of the purchasing office, of the risk manager, of the administrative operations executive manager and the idea that you could trigger something that is going to take an intense amount of work -- and I don't want to leave out the county attorney's office. That that is the number one priority when we're trying to get a jail r.f.p. Locked down and going into a legislative session. I think it's not being respectful of people's time and energy. I like the way you guys have put it in the recommendation is that the r.f.p. Needs to go out when the r.f.p. Needs to go out. And to me that ought to be triggered by service and not some arbitrary whatever. This has taken up -- sucked up so much of the time of this Commissioners court and so many staff people that it is inconceivable that someone would say, hey, let's do this again in another three months. I think they ought to have the courtesy of one year of performing and we'll see where it's at. I really do believe that.
>> that's c.
>> I just want to make sure --
>> let's finish a and then we'll go to c.
>> I appreciate it, judge.
>>
>> mine was a simple clarification on your motion. When I heard it, it sowntded to me as if you might have suggested that it was a one week contract with a -- one year contract with a single option to extend. The fact is it's a single one year contract that can be extended for additional one-year periods in perpetuity as long as you choose to go forward.
>> that's my intention.
>> I thought it wasment.
>> it would not happen automatically.
>> and the adjustment to the December 31st date related to the other. Okay. I'll come back to my thing in a second.
>> first of all, this is not a one-year deal. This has gone on 27 years. Bear in mind that nationwide as we heard just last week or last couple of weeks there have been huge amounts of dollars derived from this business endeavor that they have. So let's not cry over that this company hasn't made money and every company needs to make money, I'm fully aware of that. And Commissioner Davis is exactly right. If you want to keep the pressure on people, then they've got to understand that they've got to perform. But if you take that to the next step, we will never know if we have got the best deal. We've got obviously -- we've got a much better deal with nationwide than we had. I think nationwide will agree and all of us will agree, but you don't really know where you need to be unless you really get out on the street and you put an r.f.p. Together and people go, you know, now we know that we've got the best deal that we can. That's how you find out if you have the best deal. And nationwide very well could win that. I'm sure they would love to have me go, congratulations, you won this thing fair and square and that's where we need to go, but we're still not doing what I know that we set out to do, which is if we have a fiduciary responsibility, which we do, then let's find out exactly what the best deal is for someone. There is no question that any kind of a change with administrative duties of handling our 457 is that there potentially could be some money lost, gone away, call it whatever you want, but you factor that in if you feel like that you have got snab can come along and make up, do better or whaf, but you don't know these things until you really put it out. We haven't put it out. We've hammered nationwide --
>> we did hire a consultant to help us determine what the market is and what the best deal was, and to commend the committee, I think they did an exhaustive review of what those improvements would be and nationwide met all of those.
>> I'm not questioning that, sid. I'm telling thaw if you want to know where you got the best deal have you to put it out to more than one person. And we set this deal up this way. I mean, we set it up where nationwide was going to win this thing and fine, I've gotten over that. You just need to get over some things here, but that is not the best way to go about torks find out if -- to fine out where you need to be, period. If anybody is listening, any business person knows that that is not the way that you do this. And I do think that the one year is the thing that we need to look at and I will continue to push to have an r.f.p. Because I'm never going to be satisfied until we have an r.f.p. And we really see where this business needs to be. And -- but the one-year --
>> can we just vote on a?
>> just one thing here, though.
>> this is on a?
>> yes, it is. It's relevant to what Commissioner Daugherty just said.
>> what he just said wasn't on a. It was on c.
>> we have been unbelievably helpful if the committee had sent out a questionnaire of even who has a deferred comp account to ask for their opinions. It is not simply about can we do better in the market? They never did fine out what the level of satisfaction or sedation dissatisfaction was of everybody that's got an account. They were asked to do it, they chose not to do it. We could have had a whole lot more information if we this gone in that direction of asking people where are you?
>> all in favor of 19-a, which is to renew annually after being brought to the Commissioners court forever if possible. Each year it rolls around. All in favor? That passes by unanimous vote. Let's hurriedly going to 19-c,ly re lease of a request for proposal for deferred compensation plan services. If we were to vote for this when would we issue the r.f.p.? When is the recommendation?
>> the recommendation is to do it when it's financially feasible, meaning that the market value adjustment has dropped down significantly, otherwise we go out when it's up to where it's at now, #- 200 something thousand dollars. The likelihood of getting good responses is less than if it drops down to a reasonable amount. So the --
>> do we have any idea of when that might be or is that impossible to say?
>> if I did that I would be a stockbroker.
>> the market value adjustment is dernld by a combination of financial factors, one of which is the interest rate.
>> I remember all of that plus the numbers for now, the last month, the month before. I remember all the stuff you tell me. So if we issued an r.f.p., which would it be or can we say right now? Might it be a year anyway?
>> it might be three or four years. The last time that I remember the market value adjustment being at zero was two or three years ago if I remember correctly. William, do you remember the exact timing on when it was at zero?
>> it's been years.
>> it's been several years.
>> I'm just trying to ensure that it's not simply a matter of the market value adjustment has gone down to zero. It also ought to be tied into another thing that would trigger an r.f.p., would be performance. I'm trying to get to a place where transformance at some point is valued into the equation related to when you go out on an r.f.p. It ought not just be a situation of when the market value adjustment gets to a certain point it should trigger it. It really ought to be the -- I like the part that says at the court's direction, but to me it ought to be a blended response of it may be appropriate to do it at the market value adjustment, it may not be. But I'll tell you this, if people are unhappy with their service, that ought to trigger a conversation whether the market value adjustment is perfect or not. I'm just trying to get that somehow that this company be allowed for one year minimum to be allowed to perform, and people move on with their lives. Just this idea that it's hanging throughout and we can have a drau drop and all of a sudden we're dropped back into this two months from now.
>> we've made it that way. We allow people enough time to perform.
>> thank you.
>> we've been pretty consistent on that.
>> can you tell me when -- I guess the question would be this: when would be the best time -- or let me ask staff. The evaluation period that should be allowed, what is the evaluation period that should be allowed to check the performance of this particular event that we're dealing with today? When would that actually take place? When would be a good time to go ahead and value it and say see all those things they they had serp going to do -- said they were going to do, when and how would that performance check be made?
>> the answer to that is somewhat in item c with creating a deferred compensation committee, standing committee to do oversight.
>> we're at c. Request for proposal because that's what we were discussing.
>> could I make a comment on that? I don't know what the best evaluation time is, but I can tell thaw on all of the other employee benefit contracts like united health care's contract, like unen's contract, like safeguard's contract, we give them a one-year contract with the option to renew for a specified number of years if it's an insurance contract because we have to on -- we've always gone with a maximum of four years on those contract. This one we don't have that maximum on. But one year with the option to renew suggests that if they didn't do what we wanted them to in that first year we would be out with another r.f.p. In the first year. The experience that I have had is that we havener gone out until the end of -- like the four years was up. So I think it's a continuing evaluation period, but the time that we have consistently applied in other contracts of this type was within the first year of performance.
>> I guess I'm getting back to what Commissioner Sonleitner said and what everybody else is kind of talking about a little bit. That is, the satisfaction as far as the end user is concerned. If there are employees out here who are not really happy with nationwide and feel that they're getting a raw deal one way or the other, I mean, that would be a combination of things I think that need to look and be be reviewed as far as the evaluation criteria. I just want to make sure that I don't want nationwide to feel that they're locked into an ongoing situation where they are here to stay forever. I don't want them to feel that way. You get in a crfert mode when you -- comfort mode when you get like that. And we've got disgrunt especially he he would employees running all over the place, Commissioner I don't feel as strongly as you do about this and I disagree with what nationwide is doing. Somewhere along the line there has to be something in place whereby we can evaluate not only the performance of nationwide, but what the employees and everybody else is talking about if they're not happy. My concern is how do we do that?
>> all right. Is this a compromise? That we vote to issue a request for a proposal as appropriate, but that we not change vendors in response to proposals received until after one year. So if even if we got the best deal in the world we wouldn't act on it one year, and it may that be we do the r.f.p. In one year based on market conditions. So if those conditions changed, in February we issued the r.f.p. And we received some miraculous proposal in may, well, nationwide still has that one year. Do you see what I'm saying? Even if we were to decide to change vendors, we would not do that until after one year of nationwide's contract, which is in 19 an-a. What I'm hearing is that it's not like we can vote to issue the r.f.p. Today and tomorrow issue it, right? We're looking at the things that y'all mentioned. But no matter when we issue the r.f.p., no matter what kind of responses we got, he even if we got responses that indicated somebody else should be the vendor, nationwide is located in for one year. Do you see what I'm saying? So we wouldn't act on the responses until one year from whatever the effective date of the contract in 19-a is.
>> that's my issue with this --
>> I think that's a good exroments.
>> here's my issue with that. The act of an r.f.p. Is unbelievably labor intensive of purchasing, the risk manager and the county attorney's office, and I can't imagine that the --
>> it's their job.
>> [overlapping speakers].
>> I don't heash the county attorney and risk management complaining.
>> we're not complaining about the r.f.p. And the work load, but we've been negotiating this deal for almost two years and there are all kinds of recording requirements.
>> [overlapping speakers].
>> somebody will recommend that we change vendors in six months and I'm not. I'm thinking that if we really look at this and market conditions that ought to drive the issuance of an r.f.p., we're sitting back and waiting on the opportunity and whenever the opportunity comes then we issue the r.f.p. And get proposals, then we evaluate those and then probably negotiate with nationwide, but they still have it locked in a year.
>> and we also wait until the market value adjustment is 50,000 or less. That's also a trirg. Triggerment.
>> I just said as appropriate. The other thing to me is that it may well be that we decide at some point that for the deferred compensation we ought to end up with two vendors. We've got a whole lot of current employees with nationwide that are happy, I don't see me forcing them to go somewhere else necessarily. But if there's a new opportunity, y'all people may want to look at nationwide or the other, then nationwide has an opportunity to make their case. You've got a choice a or b, choose a.
>> even our consultant said that hiring two providers was not the best route for us to go.
>> we'll make that call at that time.
>> let me try a substitute motion. And that is item c, the r.f.p., that that be tabled for one year.
>> second.
>> all of a sudden we have never tabled before and today this is the second table.
>> this says that they be allowed --
>> tabled one year and seconded by Commissioner Gomez.
>> they can perform pnd and in one year we will be able to reevaluatement.
>> what was the original motion?
>> it wasn't the original motion. I threw out an idea.
>> okay. This is the original motion?
>> is to approve the issuance of an r.f.p. As appropriate. As appropriate means at that time we make the call, based on the conditions that we've heard about today, but that we do not change vendors in response to the r.f.p. Until at least after one year. So I'm trying to lock in nationwide for one year. The other thing -- did you second the substitute motion?
>> yes.
>> my discussion part of it, it seems to me that a lot of these dates are within our control. The market conditions are not, but if we are standing back looking at market conditions and trying to figure out when they get right, then we issue the r.f.p., then we get responses in, then we decide whether to act on them, how to act and when.
>> the define the market conditions. This is things that is it $50,000, is it $100,000. I can see folks coming back going, what the court intent on that particular day?
>> we will make the call at that time. And the reason I say that is it may be real bad today. We may look at it six months and it's getting worse and we may say that it's getting worse, we may never do itment.
>> why not.
>> absolutely.
>> but the point is that each one of these situations and each one of these motions would actually allow a year to go by.
>> at least.
>> that's the common bond here is that a year has gone by. And I think that's what we really are looking at is a year -- have a chance to look at the year performance, have a chance to look at the yearly involvement and then go from there. So it doesn't bother me at all to --
>> I think there's a big difference between the two. One of them says the motion to table if we get back to it is if the first motion fails is basically they get a year to perform before the earliest anyone will say let's talk about an r.f.p. The way the junk's motion reads is we could be back in an r.f.p. Situation and it basically says nationwide, you don't even get a chance to perform, but we're going to require you to perform for a year before we dump you. And yopt I don't think that's what -- and I don't want that's what we ever intended.
>> that's not your motion, is it?
>> that's exactly what will happen.
>> that's my motion in the worst light.
>> [ laughter ]
>> I'm the program director with nationwide retirement solutions. What I would like to address the court is that really with enhancements that we have and that kim is going to be responsible for and I'm going to be responsible for for the employees of Travis County is going to take us a year to really dem strauss the enhance -- demonstrate the enhancements and won't have the dlet on our back that an r.f.p. Will come and investments that the company has made. I ask that we have an opportunity to perform at least for one year.
>> and I think what the motions -- both motions if I'm hearing right, both of them say that you would have a year to perform. And I don't think that neither one of them have -- have gotten away from what you just said as far as looking at a year. And I think it would be consistent in what we're doing in a.
>> but for me the tabling it for one year is very clear that we won't take any action until after the year is off the table.
>> that's right. Kim wilder, I'm the deferred compensation representation here in Travis County. I think that the way the contract's written with the number of new meetings I am going to be required to give in Travis County and the amount of new information that's going to connell through me to your employees and then subsequently perhaps -- I don't know, next month or in six months maybe having to change, that may be quite confusing for them if I'm on a campaign that we have a new contract and then? A knew months we'll have to be talking about different funds or the addition of funds or what exactly will we have eventually. And that might be something we need to change within the contract in terms of, you know, having that approach differently. I'm concerned about the employees out there thinking we're going to change now and then potentially have to change again within a very short period of time. And I know how -- how we've been so present here in the county in the last few years.
>> the substitute motion is to approve the issuance of an r.f.p. As appropriate, as we determined we ought to issue one, but to lock nationwide in for one year that we would not act in response to an r.f.p. In a way that would terminate this contract for at least one year. That's the substitute motion. All in favor of the substitute motion? Judge Biscoe, Commissioner Davis voting in favor. And Commissioner Daugherty.
>> you will do this all in two months.
>> and the other two vote against it, I take it.
>> absolutely.
>> that motion carries by a vows of three to two. Can we go back to bment or should we go to d?
>> we should probably take b first.
>> b is contract renewal with the retirement store to provide expertise to the Commissioners court and the committee on the deferred compensation.
>> we've worked closely for at least eight months with chris barrow, and in doing so he's demonstrate the not only his expertise in the area of 457 b plans, but in being able to communicate with the committee so that it's not just understood what's taking place, but why and how. I think those are valuable assets to take into any committee setting should the court create a standing deferred comp committee. I think that his understanding of the county, the program, the analytical things he's displayed is invaluable.
>> that's why I move approval.
>> what's the cost?
>> $175 an hour.
>> is there a limit on the number be of hours?
>> it's more than that. The way the mod is written, we would pay him $6,000 to develop the r.f.p. We would then pay him another $6,000 when we-- when he helps us respond to the proposal. Then we'll pay him another $4,000 for assistance in making the contract award. And then any other services will be paid at $175.
>> wouldn't that trigger the need for outside competition?
>> the part that did not get read in that is if an r.f.p. Is approved by the Commissioner's court, that would be his fees that would be payable in relation to it. And in fact that is a reduction from what he had originally had in the contract. That is only triggered if the court did not dot r.f.p. What will be the real cost drier on this is the fact that he will be assisting the committee in terms of reviewing the investments that have been selected to be part of the plan and assisting the committee in developing an investment policy in writing. We've got sort of an idea of the kinds of provisions that we want in it, but it hasn't been reduced to writing yet. And --
>>
>> [inaudible - no mic]. Which in this line of work is reasonable. It's that as I remember. Di say it was comparable or less than we were paying before. I don't know that we think we can do without this service from somebody, right?
>> that's correct.
>> and we entered into this contract after an issue an r.f.p. And signed a compete, didn't we? We didn't just go out and select?
>> it was an r.f.p. Selection.
>> help me understand why these things would not be two totally separate things? The ongoing help, I understand that, but it seems like if there's going to be an r.f.p. That you readvertise and try and see -- because this is a contract that is going to exceed $25,000 and it's like we're talking about something -- actual employment here. I kind of thought that we had hired sid to help do the r.f.p. And do all of that kind of stuff, but I just think that's a ridiculous amount of noun that and if you need the services you get it at the time, but you don't keep somebody on contract to do something that you might need in five years.
>> but if we issue an r.f.p. And choose another vendor or firm, person, do you think we'll be spending less?
>> based on the proposals that we got. Previously, I don't think that we would -- it would be reasonable to expect it to be less. It might be about the same. But the other thing is if we do want to go out for an r.f.p. And if we don't want al to do the r.f.p., we can always at that point in time get someone else to help us with the r.f.p.
>> well, I presume that.
>> I'm like you, now, I hate giving sid all this additional work to do.
>> it seems to me that if you needed that, then you would do a contract mod with al to get those services. But right now to have a preloagd that somebody will get an r.f.p. Not knowing if the r.f.p. May not be triggered by a future court for a year or two years or four years, I don't think makes sense.
>> barbara?
>> it's already in the contract that he would do an r.f.p. The point of putting it in the mod was to reduce the price so that instead of it being the price he had originally agreed to, we've lowered the price if we had choose to do an r.f.p. If we extend the contract without that in the mod, we still have -- we still have the townt have him do it, it will just cost us more.
>> that was my understanding. Is it in the mod basic 38 we had these sums for category of services, but he's submitting an hourly bill for services, right?
>> well, if it isn't related to the r.f.p., he submits an hourly bill. If you decide to do an r.f.p., then he's capped at the amounts that are there no matter how much time it takes him do the r.f.p.
>> just the trait hourly fee -- the straight hourly fee based on invoicing, it may well be that we end up paying more than what y'all have negotiated the contract for. So is it better just to convert to a straight hourly fee or on the same basis that --
>> based on what I have seen consultants do when they have helped to do r.f.p.'s in relation to health care, they always lose on the hourly rate. If they had just charged us an hourly rate, they would probably have gotten about a third more than they would. And I don't know whether that will be the same with this one because health care is a minute thing and I don't know if this is that good in minute.
>> what I'm trying to get an understanding is this: please correct me if I'm wrong, but nationwide has committed a certain amount of money that should more than sufficiently cover all's services if indeed it's just the consulting, monitoring evaluation work. But who is going to pay the bill if indeed an r.f.p. Is issued, etcetera, etcetera, and all of a sudden there's a 25,000-dollar bill, is there some expectation that nationwide is going to pick up the cost of that? Who is going to pick up the cost of that?
>> the contract reads that nationwide will provide the county $10,000 for the cost the county may incur to seek the advice of a stunt and the management of -- of a consultant and the management of a plan and its negotiations with nationwide at the execution of this agreement and five thousand dollars on the anniversary of the contract as it's extended. So they will give us $10,000 now and if we extend it next year, five thousand dollars.
>> and if you start an r.f.p. Process in February that will trigger costs of $25,000, who is picking that up?
>> do we want to postpone b to some other time? We're kind of running out of time because there are some issues -- we have three interviews and some other issues that we need to try to get to today.
>> this takes a lot of time.
>> and al's contract does expire today. So if we don't renew it today, which is our recommendation, we'll have to come back, but we can exempt it.
>> Commissioner Daugherty?
>> I know you want to end this thing, but the worst thing that we can do is to have nationwide give us $10,000. What does it that look like.
>> [overlapping speakers].
>> come on.
>> [overlapping speakers].
>> it was 25,000.
>> you may have picked up $10,000 sitting here today. We'll have this back on. Let's rethink it, okay? That was your idea.
>> so are we rethinking the contract term too. That's written into the contract that you approved that they would pay us that money.
>> actually, that money is payable whether we are not -- we incur anything for a consultant, so that's just money that the county gets. They're not paying it to al, they're paying it to the county.
>> we can change this to amend had what we pay out. But if we look at it and died not to do it, I'm sure nationwide will look at it and decide to do it. Who is on the committee? While bring it back when we have more time.
>> the committee members, I had listed those.
>> dan mansour, mary mays, alicia perez and charles vaughn, barbara wilson. So we have nobody from the court.
>> sid, will you try to volunteer to be on this committee?
>> no, sir. I'll just attend when I need to.
>> all right.
>> I think we need a court member on it.
>> I'm looking at it from a different perspective. I don't see diversity on this committee and I will use that in every sense of the word, diversity, in terms of looking at like we did on the employee benefits committee where we had large departments, small departments, and in this case I'm looking at large investors, small investors. I'm not an investor, whaf. I don't see this as being --
>> shall we bring b back, then we'll bring back d and any recommendations as to who should be on the committee or who is on the committee and wants off. Then let us know that when we bring it back, try to get a committee in place. This is fairly serious work, I take it.
>> it's very serious work.
>> and time consuming, so the committee members should know that, that it will take some time and there's a learning curve. Nationwide will help with that. But also if our goal is to get more input from employees and bringing them up to speed on what's happening, then we would expect the committee to help us do that.
>> surveying the people who are in deferred comp and survey the people who aren't and find out why aren't you.
>> b and d we'll bring back.
>> thank you.
>> thank y'all.
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Last Modified:
Wednesday, December 13, 2006 10:35 AM