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10 THE CITY OF nag — "" "' CITY COUNCIL AGENDA REPORT jL- ATdN_ June 15, 2021 Human Resources TITLE: APPROVE THE PROFESSIONAL SERVICES AGREEMENT BETWEEN THE CITY OF PLEASANTON AND INNOVATIVE CLAIM SOLUTIONS, INC. TO PROVIDE THIRD-PARTY ADMINISTRATION OF THE CITY'S WORKERS' COMPENSATION PROGRAM SUMMARY The City of Pleasanton ("City") currently uses the services of a third-party administrator, Innovative Claim Solutions ("ICS"), to help manage and process claim administration and meet reporting and compliance requirements for the City's workers' compensation program. The City entered into a three year agreement with ICS; subsequently the City extended the agreement via amendments, with the current amendment set to expire June 30, 2021. Per the City's Purchasing Policy, after a professional services agreement has reached five years, the City must issue a request for proposals. The City's professional agreement with ICS has met this threshold. Therefore, the City issued a request for proposals for vendors to provide the services of a third-party administrator to help manage the City's workers' compensation program, beginning July 1, 2021. Six vendors submitted proposals. The City's review committee evaluated all responses and selected the proposal from ICS. RECOMMENDATION Approve a professional services agreement with ICS for three years, with the option to renew for two successive one-year terms. Renewals will be mutually agreed upon by both parties. FINANCIAL STATEMENT The total cost of the professional services agreement with ICS is $647,302 for a three- year term, with a cost of$209,510 in the first year. The option to renew for two successive one-year terms is $228,659 (year four) and $235,429 (year five). There are sufficient funds in the Fiscal Year 2021/22 and 2022/23 budget to cover the costs of the first two years of the professional services agreement. Page 1 of 3