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3.5 3.5 AGREEWNTSTenflex-2016-17 Service Fee Agreement—9-26-16 RESOLUTION AUTHORIZING ENGAGEMENT OF PENFLEX, INC. SERVICE AWARD PROGRAM SPECIALISTS TO PROVIDE ADMINISTRATION AND SUPPORT SERVICES FOR 2016/2017 AND PROVISION OF 2016 STANDARD YEAR END SERVICES RESOLUTION NO.: ,2016 INTRODUCED BY: WHO MOVED ITS ADOPTION SECONDED BY: WHEREAS, the Queensbury Town Board wishes to engage the services of PENFLEX, INC. Service Award Program Specialists to provide administration and support services during 2016/2017, and the 2016 standard year end administration services for the Town of Queensbury's Volunteer Firefighter Service Award Program and the LOSAP Audit Package, as outlined in PENFLEX's Service Fee Agreement presented at this meeting, and WHEREAS, PENFLEX will provide these services for a total estimated cost of$12,745, NOW, THEREFORE, BE IT RESOLVED, that the Queensbury Town Board hereby authorizes the engagement of PENFLEX, INC. to provide administration and support services during 2016/2017 and the 2016 standard year end administration services for the Town of Queensbury's Volunteer Firefighter Service Award Program for a total estimated cost of $12,745, to be paid from the appropriate account as determined by the Town Supervisor and/or Town Budget Officer, and BE IT FURTHER, RESOLVED, that the Town Board hereby authorizes and directs the Town Supervisor to execute the agreement with PENFLEX, INC. substantially in the form presented at this meeting and the Town Supervisor and/or Town Budget Officer to take any other actions necessary to effectuate the terms of this Resolution. Duly adopted this 26th day of September, 2016 by the following vote: AYES NOES ABSENT: PENFLEX , INC. SERVICE AWARD PROGRAM SPECIALISTS www.penflexinc.com Penflex,Inc. Phone:800.742.1409 50 Century Hill DL,Suite 3 Fax:518.783.6915 Latham,NY 12110 Email:info@penflexinc.com September 2016 Ms. Victoria LaMarque Town of Queensbury 742 Bay Road Queensbury, NY 12804 Re: Service Award Program 2016-2017 Service Fee Agreement Dear Ms. LaMarque: Enclosed is our Service Fee Agreement, which sets forth the fees we will charge to provide actuarial and administration services described on the back of the agreement. An Annual Statement detailing fees billed and paid to Penflex over the last 12-month period and a Penflex directory are also enclosed. 2016 has been our busiest year ever. During 2014 and 2015 the New York State Comptroller's Office (OSC) issued reports on 21 point systems they had audited. We obtained copies of these reports, scrutinized them, and prepared a booklet of these audit findings for all of our clients. We presented seminars on our audit findings. We met with and helped many of our clients amend their point systems in light of these OSC audits. We expect to be helping many more clients as they contemplate amending their point systems. For many of our clients, the investment return on their Service Award Program Trust Fund has not met expectations in the last several years. As a consequence, with few exceptions, the costs of defined benefit Service Award Programs have increased. While that in itself presents problems for almost all our defined benefit clients, factoring in the Property Tax Cap created a significant problem for the majority. To help our clients, we have prepared cost estimates of proposed changes to their Service Award Programs with the intention of lowering program costs. We've also refined our actuarial cost calculation methodology to mitigate cost fluctuations due to investment performance, and to amortize unfunded actuarial liability over a specific number of years. Our actuarial staff (we now have three actuaries on staff and one actuarial student) as well as our LOSAP specialists have attended an unprecedented number of meetings in 2016 to help our clients with funding and investment issues. We expect to attend even more meetings in 2017. Since I started Penflex in 1990, I have rarely charged our clients for these kinds of non-standard services. We have always encouraged our clients to reach out to us for help without concern about incurring additional fees. The meter isn't running when a client contacts us. Except for formal cost studies (i.e., not approximate cost estimates) or preparing formal plan document drafts for review by a client's legal advisor, we generally do not charge additional fees. What we have historically done when we need to step up our efforts to be responsive to all our client common needs is to increase our standard services fees for all our clients. You will see that I have done that in the attached standard services agreement for 2016/2017. Any questions about the fees set forth in the attached agreement or the services we provide should be directed to me at eholohan(ffipenflexinc.com. You can also speak to me directly by calling our office. If it has been several years since we met with you or the municipal Board, please contact us to set-up a meeting. Ms. Victoria LaMarque September 2016 Page 2 Please return a signed copy of the Service Fee Agreement(be sure to indicate YES or NO regarding the LOSAP Audit Package). If an invoice is attached, please also include a check for the amount invoiced. Otherwise, we will bill you for administrative fees at the agreed upon time. If applicable, enclosed is a directive letter to have the fee paid from the Trust Fund. All of us at Penflex sincerely look forward to working with you for another year. Thank you for your continued business. Serving your Volunteers, p� Edward J. Holohan President&Actuary • Penflex, Inc. 111112016-1013112017 Service Fee Agreement TOWN OF QUEENSBURY VOLUNTEER FIREFIGHTER SERVICE AWARD PROGRAM Standard Services Fee Schedule Per-Participant Fee: $45, $0 change from 2015 Payment certification and trustee directive letters: $75 per letter, $0 change from 2015 Total Estimated Standard and Distribution Services Fees: $12,400 Optional Services Fee Schedule PLEASE CHECK ONE BOX: El COMPLETE the 'LOSAP Audit Package' for a fee of$345. Auditing Firm: Contact Name: Email Address: Please note: the LOSAP Audit Package does not satisfy the LOSAP audit requirement, but it assists the accounting firm performing the audit. El DO NOT COMPLETE the 'LOSAP Audit Package' and bill us for the cost of Penflex services for preparing and communicating information we direct you to prepare and forward to the accounting firm which will audit our Service Award Program. All other services are optional and are billed only when requested. Please call for fee estimates and purchase order arrangements. Optional services include additional client meetings, drafting of special correspondence and documents, and performing cost estimate calculations for proposed program amendments. To authorize Penflex, Inc. to begin providing these services in accordance with this fee schedule, please have the Town Supervisor sign and return this Service Fee Agreement. Keep a copy for your records. & . 9 cW , Supervisor Edward J. Holohan, ASA Town of Queensbury President, Penflex, Inc. P E N F L EX , INC. SERVICE AWARD PROGRAM STANDARD SERVICES 1. For each Service Award Program participant (including the persons who are being paid monthly Service Awards), prepare an annual Service Award Program individual participant statement. 2. Prepare for the record and for audit purposes an annual Service Award Program report which: a. shows and completely documents the calculation of the annual Program cost. b. accounts for changes in the Program's assets. c. by individual volunteer, lists their earned Service Awards, death and disability benefits, (defined benefit plans) or accounts for changes in their Program accounts (defined contribution plans). d. summarizes the major provisions of the Program. e. lists current payment recipients. f. includes a service credit listing for current participants. g. includes a written description of the actuarial methods and assumptions used to calculate the annual program costs (defined benefit plans). h. For members of the Sponsor's Governing Board or Officials, prepare: i. "Fact Sheet"which includes current year important information about their Program. ii. "Special Commentary" correspondence which alerts officials about emerging issues or problems and/or which explains changes in the Program (such as an increase in Program funding costs). 3. Meet (one meeting) upon request, first with officials and then with volunteers to review the Annual Report, to answer questions from volunteers about their annual statements and to update officials and the volunteers on Service Award Program related legislation and on their own Program. 4. Provide forms and instructions to enroll new volunteers, change beneficiaries, file for benefit payments, etc. 5. At year-end, provide written instructions about how to prepare the required certified listings to be approved by the Sponsor's Governing Board and fire company officials and posted by the fire company and to be sent to Penflex, Inc. 6. Project the Program's cash flow needs in order to plan and formulate investment strategy. 7. Prepare written notification/explanation to be sent to persons who cease to participate in the Program. 8. During normal business hours, have trained staff available to answer questions from officials and designated client contact persons. 9. Throughout the year, receive, review and reconcile financial statements from custodian and/or investment and/or insurance providers. 10. Process Service Award payment applications, certify payment amounts and eligibility, prepare payment directives and communicate directly with the payment recipient and/or custodian and/or paying agent when necessary. 11. Answer routine questions from client's auditors about the Program and the annual report. 12. When required, prepare vouchers for payments to the Program Trust Fund. 13. Prepare and communicate to clients preliminary cost estimates of proposed changes to Program. 14. Help clients resolve Program funding issues. 15. Advise clients about potential Program non-compliance with applicable laws.