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HomeMy WebLinkAboutEstablishing a Non-Reverting Insurance Premium & Liability Reserve FundORDINANCE No. 6657 -79 Passed by the Common Council of the City of South Bend, Indiana_ e October 8, 19--Z-9— City Clerk IRENE K. GAMMON of Common Council Presented by me to the Mayor of the City of South Bend, Indiana October 9 19 79 4'--" "e— �� 1��, ,. City Clerk IRENE K. GAMMON Approved and signed by me �9 a BILL NO. 125 =79 ORDINANCE NO. (Q - AN ORDINANCE OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA, ESTABLISHING A NON - REVERTING "INSURANCE PREMIUM AND LIABILITY RESERVE FUND ". STATEMENT OF PURPOSE AND INTENT: The City Administration has determined that it would be in the City's best interest to retain a larger share of its potential liabilities in view of current upwards trends in the municipal insurance market, The Ordinance is proposed as a method for retaining such risks, paving premiums and providing the mechanism to service such retained risks and potential liabilities. WHEREAS, the Common Council of the City of South Bend has determined that it is in the best interests of the City that the City become self - insured in certain areas of public liability imposed upon it by law arising from the ownership of property and acts of its employees in the course of providing services; and WHEREAS, the Common Council has determined that the City has the financial ability to accomplish its own funding to cover said areas of retained liability and that it would be to the fiscal advantage of the City to do so. NOW, THEREFORE, BE IT ORDAINED BY THE COMMON COUNCIL OF THE CITY OF SOUTH BEND: SECTION I. Reserve Fund Created A general non - reverting fund is hereby created to be known as the "Liability Insurance Premium and Reserve Fund ", Said fund is created for the purpose of setting aside monies, assessed on all operations and departments of the City, for the payment of any premium for outside coverage, claims arising from retained risk and all incidental costs associated with any claims arising from said retained risk including, but not limited to, investigative and legal fees.. Said reserve fund also shall be used for the purpose of funding the administrative positions or contractual services of a risk manager, legal counsel, claims adjuster, and necessary support personnel. Said fund may be used for a source of temporary loans to other City funds but shall in no way be assessed for permanent 1Qans. Said fund shall be invested by the Controller's Office with all earned interest belonging to said fund in it's entirety. SECTION I 'O, Payment of Certain Departmental Safety Coordinators The administration and common council to dramatize -their commitment to employee and job safety, and also to recognize that certain employee safety coordinators will be performing this duty outside of the normal work duties do hereby authorize the payment of a stipend in addition to their normal wages in the amount of $100.00 annually. The following safety coordinator positions shall be in this category. Traffic and Lighting Municipal Garage River Bend Plaza Maintenance Bureau of Sewers Bureau of Streets Waste Water Treatment Plant Water Works (North Pumping Station) Water Works (Olive Street Station) Parking Garages SECTION II. Source of Funds Said fund shall be funded by amounts appropriated by the Council as part of the annual general budgeting process for all departments, bureaus, and boards of the City. In addition, the Council may approve additional appropriations as needed from these same sources. SECTION III. Expenditure of Funds No expenditure of funds or payment of claims arising from the City's retention of liability shall be made by the Board of Public Works without the approval of both the City Controller or his named representative, and the City Attorney or his named representative. Insurance premiums shall be paid on policies acquired through the process described in 16 -21 of the South Bend Municipal Code as needed upon approval by the Controller's office. Incidental contractual expenses which may occur as a result of retained liability claims shall be submitted to the Board of Public Works for payment upon approval of both the City Controller or his named representative and the City Attorney or his named representative, SECTION IV. This Ordinance shall take effect and be in force January 1, 1980 and Rassed by the South Bend Common Council on the day of 1979. ist READING PUBLIC HEARING Cd —,'' 7 2nd READING NOT APPROVED REFERRED PASSED a Li. Ba v .: SEA' 1 9{ 1979 h Mt arnai 46 p ;, • Peter H. Mullen Director, Administration and Finance CITY of SOUTH 13END PETER J. NEMETH, Mayor COUNTY-CITY BUILDING SOUTH BEND, INDIANA 46601 September 19, 1979 Members of the Council South Bend Common Council 4th Floor County-City Bldg. Dear Council Members: 0�11W/O L LU �74_ //VDIMAN 219/284-9742 There will be presented at first reading of the September 24, 1979 Council meeting an ordinance which will enable the City to make major changes in administering it's property and liability insurance program, During the last 10 years, we have seen the cost of the City's insurance package increase from about $86,000.00 to $868,000.00 in 1979. In lieu of this financially escalating situation, we feel it is time to evaluate our position and look at alternative methods of financing the potential risks created through the day to day operation of the City. It is felt that the best wey for the City to handle this situation is using combined programs of self insurance and outside coverage depending on the specific risk. During the 1979 legislative session of the Indiana General Assembly a law was inacted which now allows cities to set up a cumulative fund to be used for the purpose of defraying those expenses normally associated with providing insurance coverage or retaining risk, The ordinance accompanying this letter would authorize said fund, but more imp-ortantly, would support in full the city's action in becoming self reliant in the area of insurance. It is felt that the city is in a position both financially and professionally to evaluate it's operations and decide which should be insured through outside sources and which should fall into the category of retained risks. CITYY' O -F -�O.UTH BEND South Bend,IN 46601 Page Two September 19, 1979 Members of the Common Council Mr. Vance and I would like to sit down with Council in caucus and explain more fully the details, benefits and risks of pursuing this course of action. If you have further questions, please feel free to contact my office or Mr. Vance. PHM /bkn coo toe Tomuton Tounril of tot Tug of oout4 ven&: Your Committee OF THE WHOLE to whom was referred A BILL OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA, ESTABLISHING ANON— REVERTING "IN- SURANCE PREMIUM AND LIABILITY RESERVE FUND." Respectfully report that they have examined the matter and that in their opinion THIS BILL SHOULD BE RECOMMENDED TO THE COUNCIL FAVORABLE. FRANK HORVATH Chairman FREE PRESS PUBLISHING CO.