HomeMy WebLinkAboutcc min 1986/04/02 MINUTES OF AN ADJOURNED REGULAR MEETING OF THE CITY COUNCIL
OF THE CITY OF CHULA VISTA
Wednesday, April 2, 1986 Council Conference Room
4:00 p.m. City Hall
MEMBERS PRESENT: Mayor Cox; Councilmembers Malcolm
(arrived late: 5:10 p.m.), Moore, Scott,
McCandliss
MEMBERS ABSENT: None
STAFF PRESENT: City Manager Goss, Assistant City Manager
Asmus, Assistant City Attorney Gill,
1. RESOLUTION 12424 APPROVING AMENDMENT TO THE SAN DIEGO
CITIES JOINT POWERS AGREEMENT FOR RISK
MANAGEMENT AND RELATED INSURANCE
COVERAGES AND APPROPRIATING ~190,000 FROM
THE UNAPPROPRIATED BALANCE OF THE PUBLIC
LIABILITY TRUST FUND (Director of Finance)
In a written report to the Council, Director of Finance
Christopher noted that two weeks ago, the Council authorized the
City to enter into a risk pooling arrangement for general
liability insurance coverage with other cities in San Diego
County. The resolution amends the San Diego County's cities joint
powers agreement to specifically allow such a pooling arrangement
and to appropriate additional funds needed to pay the annual
premium for the City of Chula Vista. The additional amount is
~190,000 which would be appropriated from the unappropriated
balance of the Public Liability Trust Fund.
Mr. Christopher noted that Councilman Malcolm will not be in
attendance until 5:00; however, the underwriter, Ernie Telford
must leave shortly after 5:00 p.m. in order to catch a plane and
asked whether the Council would hear his testimony now. The
Councilmembers concurred.
Mr. Ernie Telford, Contract Underwriter for the County of JPA
responded to Councilwoman McCandliss' hypothetical question
regarding what impact the City of Chula Vista would have if a City
such as Del Mar had a ~10 million claim. Mr. Telford stated that
in funding the initial capitalization, consideration is made that
it takes approximately 4 years to litigate and settle a claim.
Mr. Telford explained the formula for arriving at the assessments
and penalties which would be spread among the JPA members.
City Council Minutes - 2 - April 2, 1986
Mr. Ted Davidson, E. F. Driver Insurance stated cities are given
10 years to pay off their claim before any of the JPA members
would be assessed. Five million dollars is the total limit of a
claim. During that 10 year period of time, the City can go into
bond financing.
In answer to Councilman Scott's question regarding risk
management, Mr. Davidson stated that JPA has been in existence for
4 years and risk management is a key aspect of this program. Risk
management representatives have been meeting and questions are
asked, such as: what will be requirements for contractors, how
much insurance should be required for public facilities use and so
forth. Mr. Davidson submitted summary sheets in which he and Mr.
Telford explained the 5-year claims history for San Diego County
cities.
Director of Finance Christopher remarked that Chula Vista
represents 27% of the JPA and based on that, the annual premium
would be $625,000. Mayor Cox questioned what would happen if
Proposition 51 passes. What would happen to the cases that come
to trial after Prop 51 passes, and can the cities find some better
insurance protection after that?
Councilman Moore noted the increased population for the City of
Chula Vista which comes with increased risks. Chula Vista has a
Risk Management Plan but most of the other cities in the County do
not.
Council discussion continued with Mr. Davidson and Mr. Telford
answering questions as to assessments, reserves and the 'types of
claims filed by the various cities in the County (Councilman
Malcolm arrived during this discussion).
Councilman Malcolm noted that if Prop 51 does pass, the
settlements would be substantially less from the cities which will
mean that insurance companies would have to go back into the
marketplace. Previously, Chula Vista had a ~165,000 premium and
now it has been increased to ~450,000.
Discussion followed regarding potential liability if the City goes
uncovered; everyone being "fed up" with insurance companies;
should not be going into something now when there is a "light at
the end of the tunnel"; the JPA will not preclude the City of
Chula Vista from entering into it at a later date.
City Council Minutes - 3 - April 2, 1986
Mr. Robinson, responded to Councilman Malcolm's question, stating
that the JPA should not be used as a market - it is a concept
"you either like the philosophy and will join it or you don't like
it and should not join it." There will be a 7-member board of the
JPA at the present time with each City getting one vote. The
Underwriter's fee is determined by the number of cities entering
into ~he program and is based on 2-1/2% of the premium.
RESOLUTION OFFERED BY, COUNCILMAN SCOTT, the reading of the text
was waived by unanimous consent, passed and approved with
Councilman Malcolm voting "NO."
2. ORAL COMMUNICATIONS None.
3. CITY MANAGER'S REPORT
a. Assistant City Manager Asmus questioned the use of a City bus
for the Grossmont Shopping Center tour on Thursday, April 10
along with the Chamber of Commerce.
MSUC (Scott/Cox) to allow the City bus to be used.
4. MAYOR'S REPORT None.
5. COUNCIL COMMENTS None.
MSUC (Cox/Scott) to reconvene as a joint meeting with the
Redevelopment Agency and to go into Closed Session for potential
litigation, Sierra Club vs. the Coastal Commission and 404 Permit.
The Council/Agency recessed into Closed Session at 5:30 p.m. The
City Clerk was excused. The Assistant City Manager reported the
Session ended at 6:30 p.m.
ADJOURNMENT AT 6:30 p.m. to the meeting of Tuesday, April 8, 1986
at 7:00 p.m.
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