AGREEMENT BETWEEN THE CITY OF SANTA ANA AND
STERLING HEALTH SERVICES FOR AFFORABLE CARE ACT COMPLIANCE
THIS AGREEMENT is hereby made and entered into this 19th day of November, 2024, by and between the City of Santa Ana, a charter city and municipal corporation organized and existing under the Constitution and laws of the State of California ("City"), and Sterling Health Services, Inc. a California Corporation doing business as Sterling Administration (“Consultant”).
RECITALS
A. The City desires to retain Consultant to assist City in maintaining compliance with the Patient Protection and Affordable Care Act (“ACA”) {42 U.S.C. Sections 18001 et seq.)
B. In undertaking the performance of this Agreement, Consultant represents that it is knowledgeable in its field and that any services performed by Consultant under this Agreement will be performed in compliance with such standards as may reasonably be expected from a professional consulting firm in the field.
NOW THEREFORE, in consideration of the mutual and respective promises, and subject to the terms and conditions hereinafter set forth, the parties agree as follows:
1. SCOPE OF SERVICES
A. Consultant shall provide services necessary to assist City in maintaining compliance with the ACA, including but not limited to, capturing all employees including full time, part time, variable hour employees, and multi -employer and/or union employees, generation of 1094 and 1 095 forms on behalf of the City including the potential for printing and mailing the forms on behalf of the City, IRS fulfillment status, aid in resolving 226 -J letter/fme issues that may develop, and providing the ability to talk with an ACA compliance specialist during normal business hours.
B. City shall provide information necessary to prepare 1094 and 1095 forms on behalf of City no later than January 8th of every year. Consultant will then distribute ACA forms to City for distribution or at City’s election, mail forms to City employees no later than January 31st. Consultant will e-file 1094 and/or 1095 forms on behalf of the City with the IRS, no later than March 31st.
2. COMPENSATION
A. City agrees to pay, and Consultant agrees to accept as total payment for its services a flat yearly fee of $3,000. Optional services of printing and mailing IRS forms 1094 and 1095 are available at a cost of $3.75 per mailing. The total sum
authorized under this Agreement shall not exceed fifty thousand dollars ($50,000) for the entire term of this Agreement.
B. Consultant will invoice City on a quarterly basis. Payment will be made within sixty (60) days of the date of the invoice.
3. TERM
The term of this Agreement shall commence on November 19, 2024 and will terminate on October 31, 2027, with two optional one-year extensions exercisable by the City with the agreement of Consultant unless terminated earlier in accordance with the terms herein.
4. INDEPENDENT CONTRACTOR
Consultant shall, during the entire term of this Agreement, be construed to be an independent contractor and not an employee of the City. This Agreement is not intended nor shall it be construed to create an employer-employee relationship, a joint venture relationship, or to allow the City to exercise discretion or control over the professional manner in which Consultant performs the services which are the subject matter of this Agreement; however, the services to be provided by Consultant shall be provided in a manner consistent with all applicable standards and regulations governing such services. Consultant shall pay all salaries and wages, employer’s social security taxes, unemployment insurance and similar taxes relating to its employees and shall be responsible for all applicable withholding taxes.
5. INSURANCE
A. Consultant shall procure and maintain for the duration of the Agreement insurance against claims for security breaches, system failures, injuries to persons, damages to software, and damages to property (including computer equipment), theft, or other misuse of City’s data, infringement of intellectual property, invasion of privacy and breach of data, which may arise from or in connection with the performance of the work hereunder by Consultant, its agents, representatives, or employees. Coverage shall be at least as broad as:
1) Commercial General Liability (CGL): Insurance Services Office Form CG 00 01 covering CGL on an “occurrence” basis, including products and completed operations, property damage, bodily injury and personal & advertising injury with limits no less than $1,000,000 per occurrence and $2,000,000 general aggregate.
2) Technology Professional Liability Errors and Omissions Insurance (E&O): appropriate to the Consultant’s profession and work hereunder, with limits not less than $2,000,000 per occurrence and $2,000,000 aggregate. Coverage shall be sufficiently broad to respond to the duties and obligations as is undertaken by the Consultant in this agreement. 3) Workers’ Compensation (W/C): as required by the State of California, with statutory limits, and Employer’s Liability insurance with limits of no less than $1,000,000 per accident, policy, employee, for bodily injury or disease.
B. If Consultant maintains broader coverage and/or higher limits than the minimums shown above for any line of coverage, City requires and shall be entitled to the broader coverage and/or the higher limits maintained by Consultant. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to City. The above required insurance policies (set forth in subsection A) are to contain or be endorsed to contain the following provisions:
1) City of Santa Ana, its City Council, its officers, officials, employees, agents, and volunteers are to be covered as additional insureds, under Consultant’s CGL, and E&O policies, with respect to any liability arising out of work or operations performed by or on behalf of the Consultant including materials, parts, equipment, and personnel furnished in connection with such work or operations. 2) Consultant’s Insurance companies agree to waive all rights of subrogation against City of Santa Ana, its City Council, its officers, officials, employees, agents, and volunteers for losses paid under the terms of any policy which arise from work performed by Consultant under this Agreement.
3) For any claims related to this contract, Consultant’s insurance coverage shall be primary and any insurance maintained by City of Santa Ana, its City Council, its officers, officials, employees, agents, or volunteers shall not contribute with it.
4) A severability of interest provision must apply for all the additional insureds, ensuring that Consultant’s insurance shall apply separately to each insured against whom a claim is made or suit is brought, except with respect to the insurer’s limits of liability. 5) Insurance policies required herein shall provide that coverage shall not be canceled, suspended, voided, reduced in coverage or in limits, non-renewed by the carrier, or materially changed except after thirty (30) days prior written notice has been given to City. Ten (10) days prior written notice shall be provided to City for policy cancellation or non-renewal due to non-payment of premium.
C. Certificate Holder on each Evidence of Insurance certificate shall be: City of Santa Ana, Attention: Human Resources Agency, 20 Civic Center Plaza M-24, Santa Ana, CA 92701. The name and location of project must be included in the Description of Operations section of each certificate.
D. Self-insured retentions must be declared to and approved by City. City may require Consultant to provide proof of ability to pay losses and related investigations, claim administration, and defense expenses within the retention.
E. Insurance is to be placed with insurers authorized to conduct business in the state of California with a current A.M. Best rating of no less than A-:VII, unless otherwise acceptable to City.
F. Claims Made Policies: If any of the required policies provide coverage on a claims-made basis:
1) The retroactive date must be shown and must be before the date of the contract.
2) Insurance must be maintained and evidence of insurance must be provided for at least three (3) years after completion of work. 3) If coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a retroactive date prior to the contract effective date, Consultant must purchase “extended reporting” coverage for a minimum of three (3) years after completion of work.
G. Verification of Coverage: Consultant shall furnish City with original Certificates of Insurance including all required amendatory endorsements (or copies of the applicable policy language effecting coverage required by this clause). Failure to obtain the required documents prior to the work beginning shall not waive Consultant’s obligation to provide them. City reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time.
H. Subcontractors- City shall require and verify that all subcontractors maintain insurance meeting all the requirements stated herein.
I. Special Risks or Circumstances- City reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances.
6. INDEMNIFICATION
Consultant agrees to defend, and shall indemnify and hold harmless the City, its officers, agents, employees, contractors, special counsel, and representatives from liability: (1) for personal injury, damages, just compensation, restitution, judicial or equitable relief arising out of claims for personal injury, including death, and claims for property damage, which may arise from the negligent operations of the Consultant, its subcontractors, agents, employees, or other persons acting on its behalf which relates to the services described in section 1 of this Agreement; and (2) from any claim that personal injury, damages, just compensation, restitution, judicial or equitable relief is due by reason of the terms of or effects arising from this Agreement. This indemnity and hold harmless agreement applies to all claims for damages, just compensation, restitution, judicial or equitable relief suffered, or alleged to have been suffered, by reason of the events referred to in this Section or by reason of the terms of, or effects, arising from this Agreement. The Consultant further agrees to indemnify, hold harmless, and pay all costs for the defense of the City, including fees and costs for special counsel to be selected by the City, regarding any action by a third party challenging the validity of this Agreement, or asserting that personal injury, damages, just compensation, restitution judicial or equitable relief due to personal or property rights arises by reason of the terms of, or effects arising from this Agreement. City may make all reasonable decisions with respect to its representation in any legal proceeding. Notwithstanding the foregoing, to the extent Consultant’s services are subject to Civil Code Section 2782.8, the above indemnity shall be limited, to the extent required by Civil Code Section 2782.8, to claims that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the Consultant.
7. RECORDS
Consultant shall keep records and invoices in connection with the work to be performed under this Agreement. Consultant shall maintain complete and accurate records with respect to the costs incurred under this Agreement and any services, expenditures, and disbursements charged to the City for a minimum period of three (3) years, or for any longer period required by law, from the date of final payment to Consultant under this Agreement. All such records and invoices shall be clearly identifiable. Consultant shall allow a representative of the City to examine, audit, and make transcripts or copies of such records and any other documents created pursuant to this Agreement during regular business hours. Consultant shall allow inspection of all work, data, documents, proceedings, and activities related to this Agreement for a period of three (3) years from the date of final payment to Consultant under this Agreement.
8. CONFIDENTIALITY
Due to the nature of the services provided pursuant to this Agreement, Consultant will be provided information by City that is confidential, including identifying information for City employees. Consultant will maintain strict confidentiality as required by all applicable laws. “Confidential Information" shall include all nonpublic information.
Confidential information includes not only written information, but also information transferred orally, visually, electronically, or by other means. Confidential information disclosed to either party by any subsidiary and/or agent of the other party is covered by this Agreement. The foregoing obligations of non-use and nondisclosure shall not apply to any information that (a) has been disclosed in publicly available sources; (b) is, through no fault of the Consultant disclosed in a publicly available source; (c) is in rightful possession of the Consultant and disclosed without an obligation of confidentiality; (d) is required to be disclosed by operation of law; or (e) is independently developed by the Consultant without reference to information disclosed by the City.
In the event of a data breach, Consultant will advise City of the breach as soon as practicable but in no event more than 48 hours after Consultant learns of any data breach involving any information provided to Consultant pursuant to this Agreement.
Consultant will comply with all applicable laws regarding notice to any person whose information was provided pursuant to this Agreement whose data has been subject to any breach.
9. CONFLICT OF INTEREST CLAUSE
Consultant covenants that it presently has no interest and shall not have interests, direct or indirect, which would conflict in any manner with performance of services specified under this Agreement.
10. NOTICE
Any notice, tender, demand, delivery, or other communication pursuant to this Agreement shall be in writing and shall be deemed to be properly given if delivered in person or mailed by first class or certified mail, postage prepaid, sent by fax or other telegraphic communication in the manner provided in this Section, to the following persons:
To City:
City of Santa Ana
City Clerk (M-30)
20 Civic Center Plaza
P.O. Box 1988
Santa Ana, California 92702
With copy to:
Executive Director of Human Resources
City of Santa Ana
20 Civic Center Plaza (M-24)
P.O. Box 1988
Santa Ana, California 92702
Fax (714) 647-6930
And:
City Attorney
City of Santa Ana
20 Civic Center Plaza (M-29)
P.O. Box 1988
Santa Ana, California 92702
Fax (714) 647-6515
To Consultant:
Ms. Cora Tellez
Sterling Health Services Inc.
1000 Broadway #250
Oakland, California 94607
Fax: (877) 517-4729
A party may change its address by giving notice in writing to the other party. Thereafter, any communication shall be addressed and transmitted to the new address. If sent by mail, communication shall be effective or deemed to have been given three (3) days after it has been deposited in the United States mail, duly registered or certified, with postage prepaid, and addressed as set forth above. If sent by facsimile, communication shall be effective or deemed to have been given twenty-four (24) hours after the time set forth on the transmission report issued by the transmitting facsimile machine, addressed as set forth above. For purposes of calculating these time frames, weekends, federal, state. County or City holidays shall be excluded.
11. EXCLUSIVITY AND AMENDMENT
This Agreement represents the complete and exclusive statement between the City and Consultant regarding the subject matter herein, and supersedes any and all other agreements, oral or written, between the parties. In the event of a conflict between the terms of this Agreement and any attachments hereto, the terms of this Agreement shall prevail and will serve to fully supersede existing Agreement. This Agreement may not be modified except by written instrument signed by the City and by an authorized representative of Consultant. The parties agree that any terms or conditions of any purchase order or other instrument that are inconsistent with, or in addition to, that terms or conditions hereof, shall not bind or obligate Consultant nor the City. Each party to this Agreement acknowledges that no representations, inducements, promises or agreements, orally or otherwise, have been made by any party, or anyone acting on behalf of any parties, which are not embodied herein.
12. ASSIGNMENT
Inasmuch as this Agreement is intended to secure the specialized services of Consultant, Consultant may not assign, transfer, delegate, or subcontract any interest herein without the prior written consent of the City and any such assignment, transfer, delegation or subcontract without the City’s prior written consent shall be considered null and void. Nothing in this Agreement shall be construed to limit the City’s ability to have any of the services that are the subject to this Agreement performed by City personnel or by other Consultants retained by City.
13. TERMINATION
This Agreement may be terminated by the City with thirty (30) days written notice of termination to the Consultant.
A. As a condition of such payment, the City may require Consultant to deliver to the City all the work product completed, as of such date, and in such case, such work product shall be the property of the City unless prohibited by law, and Consultant consents to the City’s use thereof for such purposes, as the City deems appropriate.
B. Payment need not be made for work that fails to meet the standard of performance specified in the Recitals of this Agreement.
14. NON-DISCRIMINATION
Consultant shall not discriminate because of race, color, creed, relation, sex, marital status, sexual orientation, gender identity, age, national origin, ancestry, or disability, as defined and prohibited by applicable law, in the recruitment, selection, training, utilization, promotion, termination or other employment related activities or any activities under this Agreement.
Consultant affirms that it is an equal opportunity employer and shall comply with all applicable federal, state and local laws and regulations.
15. JURISDICTION - VENUE
This Agreement has been executed and delivered in the State of California and the validity, interpretation, performance, and enforcement of any of the clauses of this Agreement shall be determined and governed by the laws of the State of California.
Both parties further agree that Orange County, California, shall be the venue for any action or proceeding that may be brought or arise out of, in connection with or by reason of this Agreement.
16. PROFESSIONAL LICENSES
Consultant shall, throughout the term of this Agreement, maintain all necessary licenses, permits, approvals, waivers, and exemptions necessary for the provision of the services hereunder and required by the laws and regulations of the United Sates, the State of California, the City of Santa Ana and all other governmental agencies.
Consultant shall notify the City immediately and in writing of its inability to obtain or maintain such permits, licenses, approvals, waivers, and exemptions. Said inability shall be cause for termination of this Agreement.
17. COMPLIANCE WITH ALL LAWS
Consultant agrees to comply with all applicable federal, state and local laws and regulations including but not limited to, the California Consumer Privacy Act (California Business and Professions Code Section 1798.100 et seq.)
18. MISCELLANEOUS PROVISIONS
A. Each undersigned represents and warrants that its signature herein below has the power, authority and right to bind their respective parties to each of the terms of this Agreement, and shall indemnify City fully, including reasonable costs and attorney’s fees, for any injuries or damages to City in the event that such authority or power is not, in fact, held by the signatory or is withdrawn.
B. All exhibits referenced herein and attached hereto shall be incorporated as if fully set forth in the body of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the date and year first above written.
ATTEST: CITY OF SANTA ANA
________________________ _________________________
Jennifer L. Hall Alvaro Nuñez
City Clerk City Manager
APPROVED AS TO FORM:
Sonia R. Carvalho
City Attorney
__________________________
By: Laura A. Rossini
Chief Assistant City Attorney
RECOMMENDED FOR APPROVAL STERLING HEALTH SERVICES, INC.
____________________________ __________________________ Lori Schnaider Sarah Soman
Executive Director of Human Resources Director of Operations
Sarah Soman