Resolution No. 5287
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RESOLUTION NO. 5287
A, RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF VERNON TO JOIN WITH CERTAIN OTHER CITIES
FOR INSURANCE AND RISK 1.1ANAGEMENT PURPOSES
WHEREAS, Sections 990, 990.4, 990.6, 990.8, arid 6500-
6515 of the Government Code of the State of California, and
Section 3700 of the Labor Code authorizes municipalities ~o
jointly exercise the power to manage their common risks; and
tiHEREAS, the City CQuncil of the City of Vernon
the purposes of the Independent Cities Risk Manag.ment
and
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WHEREAS, the Members of the Governing Board of the
Independent Cities Risk IJ'Janagement Authority have studi.ad. and
approved the Amendment to Joint Exercise of Powers Agreement For
,Insurance and Risk Management Purposes dated May 21, 1986 and
Risk Management Committee By-Laws.
NOW, THEREFORE, ,BE IT RESOLVED BY THE CITY COutlCIL OF
THE CITY OF VERNON AS P:OLLOWS:
SECTION 1: That the city Council of the City of Vernon
does hereby approve and agree to abide by all of the terms and
conditions of the Independent Cities Risk Management Authority's
Amendment To Joint 'Exercise of Powers Agreement for Insurance and
Risk Manaqement Purposes dated May 21, 1986, and the BY....Laws of
the Property, Workers' Compensation and Liability Risk,M8.nagement
" ,
Committees.
SECTION 2: 'l'ha1: the City of Vernon' does bereby join
with certainotber municipalities as a member of the 'Ind.ependent
Cities Risk Management Authority's Property, Liability and
Workers' Compensation Risk Management Committees.
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SECTION 3:
That the City . of . Vern011 cioes ~,bf:. .....
2 join other cities in accepting the Property, . Work~..:J~...
3 sationand Li.ability insurance quotations of the Inciepenj.m.t
4 Cities Risk Management Authority.
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SECTION 4:
That the Mayor Pro...tem and'CltyClflrk
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are hereby authorized and directed to execute the~tlt..o
Joint Exercis e of Powers Agreementf.or ..Insurance a_~~._
Management Purposes dated May 21, 1986 on behalf of the-City
of Vernon.
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17 ATTEST:
Theei ty Clerk of the City of V'ernoa
SECTION'S:
shall certify to the passage of, this resolution and. ,'tbneupon.
and thereafter the same' shall be in full force an4 effeet",.
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APPROVED AND ADOPTED THIS 10th day ofJ1.U.1e,19fi~
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STATE OF CALIFORNIA )
) ss
COUNTY OF LOS, ANGELES )
I, BROCE V. MALKENHORST, City Clerk of the City of " '
Vernon, do hereby certify that the fore99ing Resolution No.
was duly adopted by the City Council of the City
of Vernon, and was approved by the lofayor of said City at an
adjourned
June 10
AYES,
regular meeting of
, 19~, by the following vote:
Cou11e.ilmen: Oavis, Gonzales, Ybarra, '.
McCormick
Councilmen: NONE
NOES:
ABSENT:
Councilmen: Malburg
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(SEAL)
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AMENDMENT TO
JOINT EXERCISE OF P<YAERS AGFEEMENT
FOR INSURM~CE X\N-D RISK >"'ANA(WE~"'T PURPOSES
This Agreement is executed by and among Municipal Corporations,
hereafter referred to as Member Cities, organized and existing under
the laws of the State of California which are signatory to this
Agreement and listed in Appendix "A", which is attached hereto and
made a part of. This Agreement, dated June 10 , 1986 amends the
"Joint Exercise Of Powers Agreement For Insurance And Risk Management
Purposes" dated January 1, 1980.
RECITALS
This Agreement is predicated upon the following facts:
A. The Member Ci ties are Municipal Corporations organized and
operating under the laws of the State of California;
B. The following State laws, among others, authorize the Member
Cities to enter into this Agreement:
1. Labor Code Section 3700, allowing a city to fund its own
Workers' Compensation claims;
2. Government Code Section 990, permitting a city to insure
itself against tort or inverse condemnation liability;
'3. Government Code Section 990.4, permitting a city to provide
insurance and self-insurance in any desired combination;
4. Government Code Section 990.6, permitting the proper costs for
,self-insurance to be charged against each city and authorizing
the Governing Board to make premium payments for such coverage
in an amount such Governing Board determines to be necessary
to provide such coverage.
5. Government Code Section 990.8,1 permi tting two or more ci ties
'to enter into an agreement to jointly fund such expendi tures
unc!er the authority of Government Code Sections 6500-6515;
6. Government Code Sections 6500-6515, permi tting two or more
-cities to jointly exercise under an agreement any power which
1~ common 'to each of them.
~w, THEREFORE, for and
convenants, and agreements
agree as follows:
in consideration of the mutual benefits,
set forth in this Agreement, the parties
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ICRMA052l86
CREATION OF THE INDEPENDENT CITIES RISK MANAGEMENT
AUTHORITY.
ARTICLE I.
Pursuant to Article I (commencing with Section 6500) of Chapter 5 of
Division 7 of Title 1 of the Government Code of the State of
California, the parties hereto hereby create a public entity separate
and apart from the parties to this Agreement, to be known as the
Independent Cities Risk Management Authority, hereinafter referred to
as the "Authority." Pursuant to Government Code Section 6508.1, the
debts, liabilities, and obligations of the Authority shall not
consti tute debts, liabili ties, or obligations of any party to this
Agreement. A Member City may separately contract for or assume
responsibility for specific debts, liabilities, or obligations of the
Authority. Pursuant to and to the extent required by Government Code
Section'6509, the Authority shall be restricted in the exercise of its
powers in the same manner as the City of Manhattan Beach is restricted
in its exercise of similar powers provided that, if the City of
Manhattan Beach shall cease to be a Member Ci ty, then the Author i ty
shall be restricted in the exercise of its power in the same manner as
the City of San Fernando.
ARTICLE II.
PURPOSE.
The purpose of creating th is Au thor i ty is to exerc ise the power s of
the Member Citi~s to jointly accomplish the following:
A. Develop effective Risk Management Programs to reduce the amount
and frequency of their losses.
B. Develop Risk Management Programs of insurance to protect Member
Ci ties from the effects of catastrophic or unexpected losses.
Such programs shall include, but not be limited to, coverages for
losses arising out of Tort Liability, Workers' Compensation,
Heal th Benef i ts, and the owner sh ip or use of real or per sonal
property.
C. Design Risk Management Programs of the Author ity on a pooled or
self-funded basis whereby the ci ties share some portion, or all,
of the cost of the program losses.
D. Jointly purchase insurance, excess insurance, or reinsurance for
the purpose of transferring risk of loss to commercial insurers.,
E~ Assist Member Cities to secure a long-term financial base from the
issuance of Certificates of Participation. The revenues generated
from the Certificates of Participation will be used for the
purpose of establishing a'nd maintaining suff icient unencumbered
financial reserves ~ thereby enabling the Author i ty to prov ide
adequate protection to Member Cities against catastrophic, or
greater than expected, claims, and to attract major reinsurers for
the purpose of transferring risk.
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F. Jointly secure administrative and other services including, but
not limited to, underwriting, risk management, loss prevention,
claims adjusting, data processing, brokerage, accounting, and
legal services when related to any of the other purposes.
ARTICLE III.
DEFINITIONS.
The following definitions shall apply to the provlslons of this
Agreement and the By-Laws of the Risk Management Committee:
A. "Agreement" shall mean this Agreement creating the Independent
Cities Risk Management Authority.
B. "Board" Or "Governing Board" shall mean the governing body of the
Authority.
C. "By-Laws" shall mean the rules governing the management of each
risk by the individual Risk Management Committee.
D. "Claim(s)" shall mean demand(s) made against the Member Cities
ar ising out of occurrences which are covered qr alleged to be
covered by the Authority's Memorandums of Coverage, or policies of
insurance.
E. "Fiscal Year" shall mean the neriod of time from the date of this
Agreement to June 30, 1986, a~d thereafter ending on June 30 each
following year.
F. "ICRMA" shall mean the Independent Cities Risk Management
Authority created by this Agreement.
G. "Insurance" shall mean insur ance purchased by the Author! ty to
cover losses for its Member Cities.
H. "Member Ci ty" shall mean any Municipal Corporation which is a
party to this Agreement and is participating in one or more Risk
Management Committees.
I. "Memorandum of Coverage" shall mean the document or documents
issued by the Authori ty specifying the types of coverages and
limits provided to the Member Cities.
J. "Program Year" shall mean a per iod of time determined, usually
twelve mon'::hs, in which each program shall be segregated for ease
in determining coverage premiums.
K. "Participation" or I'Participating" shall mean a Member City has
elected to jointly participate in the management of a specific
risk and is a member of that Risk Management Committee.
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L. "Risk Management" shall mean the process of identifying,
evaluating, reducing, transferr ing, and eliminating risks. Risk
management includes var ious methods of funding claims payments,
purchasing insurance, legal defense of claims, controlling losses,
and determining self-insured retention levels and the amount of
reserves for potential claims.
M. "Risk Management Committee" shall mean those Committees, created
by the Authority to manage specific Risk Management Programs, i.e.
"Liability Risk Management Committee."
N. "Risk Management Program" shall mean the programs of risk sharing,
insurance, and risk management services established by the
Authority and managed by the Risk Management Committee.
ARTICLE IV.
PARTIES TO AGREEMENT.
Each Member City represents and warrants that it intends to, and does
hereby, contract with all other Member Cities listed in Appendix "A",
and any new members admi tted to the Authori ty pursuant to Article
XVII. Each Member City also represents and warrants that the
withdrawal or expulsion of any Member City, pursuant to Article XIV or
XV, shall not relieve any Member City of its rights, obligations, or
duties under this Agreement.
ARTICLE V.
GOVERNING BOARD.
The Authority shall be governed by a Governing Board comprised of one
Representative from each Member City. The City Council of each Member
City shall appoint a member of the City Council as the Member City's
Representative to the Governing Board. Each Member Ci ty shall also
designate an alternate Representative. The alternate Representative
may be a staff officer of the Member City. Each Representative of the
Governing Board has one vote. The alternate Representative may vote
at meetings of the Governing Board in the absence of the Member City's
Representative. Immediately upon admission of a new Member City
pursuant to Article XVII, the Member City shall be entitled to appoint
a Representative and alternate Representative to the Governing Board.
A Representative and/or alternate Representative shall be removed from
the Governing Board upon the occurrence of anyone of the following
events: (1) the Authority receives written notice from the
appointing Member City of the removal of the Representative or
alternate Representative; (2) the expulsion or withdrawal of the
Member City from this Agreement; (3) the death or resignation of the
Representative; (4) the Authority receives the written notice from the
Member Gity that the Representative is no longer a member of the City
Council of the Member City.
Representatives and their alternates are not entitled to compensation.
The Governing Board may authorize reimbursement of expenses incurred
by Representatives, or their alternates.
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Pursuant to Government Code Section 6505.6, the Authority shall
designate an officer or employee, or officers and employees, to
receive, deposit, invest, and disburse the property of the Authority
pursuant to Government Code Sections 6505 and 6505.5. The Author i ty
shall fix the amount of the fidelity bond to be filed by such public
officer(s) and/or employee(s).
ARTICLE VI.
BOARD MEETINGS AND RECORDS.
A. Regular Meetings. The Governing Board shall hold at least one
regular meeting each quarter of each year. The Governing Board
shall fix by resolution the date upon which, and the hour and
place at which, each regular meeting is to be held.
B. Ralph M. Brown Act. Each meeting of the Governing Board,
including without limitation regular, adjourned regular, and
special meetings shall be called, noticed, held, and conducted in
accordance with the Ralph M. Brown Act (Section 54050 et seq. of
the Government Code).
C. Minutes. The Authority shall have minutes of regular, adjourned
regular, and special meetings kept by the Secretary. As soon as
possible after each meeting, the Secretary shall forward to each
Governing Board member and each City Clerk copies of the minutes.
D.
Quorum.
quorum
quorum
quorum
A major i ty of the members of the Governing Board is a
for the transaction of business. However, less than a
may adjourn from time to time. A vote of the majority of a
at a meeting is sufficient to take action.
ARTICLE VII.
OFFICERS.
The Governing Board shall elect a president and vice-president from
among its members at its first meeting. Thereafter, in the last
meeting in each succeeding fiscal year, the Governing Board shall
elect a president and a vice-president. Each officer shall assume the
duties of his office upon election. If either the president or vice-
president cease to be a member the resulting vacancy shall be filled
at the next regular meeting of the Governing Board held after the
vacancy occurs. In the absence or inability of the president to act,
the vice-president acts as president. The president shall preside at
and conduct all meetings of the Governing Board. The Governing Board
shall appoint a secretary and a treasurer of the Author i ty who may,
but need not be, a member of the Governing Board. The Governing Board
may appoint such other officers as it considers necessary.
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ARTICLE VIII. POWERS
The Authority shall have the powers common to its Member Cities and is
authorized, in its own name, to do all acts necessary to exercise such
common powers to fulfill the purposes of this Agreement referred to in
Article II including, but not limited to, each of the following:
A. Finance through the issuance of Certificates of Participation, or
other instruments of indebtedness, self-insurance reserve funds
necessary or convenient for the implementation of this Agreement.
B. Incur debts, liabilities, and obligations.
C. Acquire, hold, or dispose of real and personal property.
D. Receive contributions and donations of property, funds, services,
and other forms of assistance from any source.
E. Sue and be sued in its own name.
F. Employ agents and employees.
G. Acquire, construct, manage, maintain, or operate buildings, works,
or improvements.
H. Lease real nr personal property, including that of a Member City.
I. Receive, collect, and disburse monies.
J. Invest money in the treasury of the Author i ty in the same manner
and on the same conditions as local agencies pursuant to
Government Code Section 53601.
K. Exercise all other powers necessary and proper to carry out the
provisions of this Agreement.
L. Develop and implement Risk Management Programs.
ARTICLE IX.
RISK MANAGEMENT COMMITTEES.
The Governing Board shall by resolution establish a Risk Management
Committee for each Risk Management Program implemented by the
Authority. Each Member City which elects to participate in a Risk
Management Program will automatically become a member of that Risk
Management Committe.
Each created commi ttee shall not become operational, or possess any
author i ty, until their proposed By-Laws have been approved by the
Governing Board. The voting on the approval of By-Laws shall be
%estr icted to members of the Governing Board representing cities who
are members of the particular Risk Management Committee. A two-thirds
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vote of these member s is requi red for approval of the By-Laws. On
approval of the By-Laws, the various Risk Management Committees shall
become operational and will have all of the powers specifically
delegated to it by the Governing Board. When enter ing into any
transactions author ized by the Governing Board, the commi ttee shall
use the committee title and refer to the Authority, I.e. a contract
entered into by the Workers' Compensation Risk Management Committee of
the Independent Cities Risk Management Authority.
ARTICLE X.
MEMBER CITY RESPONSIBILITIES.
Each Member City participating in a Risk Management Program shall have
the following responsibilities:
A. To appoint or remove its member of the Governing Board as set
forth in Article V.
B. To appoint or remove its member to the Risk Management Committee.
C. To approve amendments to this Agreement as set forth in Article
xx.
ARTICLE XI.
BUDGET.
The Board shall adopt an annual budget as soon as possible for the
first .Fiscal Year and not later than thirty days prior to the
beginning of each Fiscal Year thereafter.
ARTICLE XII.
ANNUAL AUDIT AND REVIEW.
The Governing Board shall cause an annual financial audi t of the
accounts and records to be made by a Certified Public Accountant in
compliance with California Government Code Sections 6505 and 6505.5 or
6505.6 with respect to all receipts, disbursements, other
transactions, and entries into the books of the Authority. The
minimum requirements of the audi t shall be those prescr ibed by the
State Controller for special districts under Government Code Section
26909 and shall conform to generally accepted audi ting standards. A
report of each audit shall be filed as a public record with each of
the Member Ci ties and also with the county aud i tor of the county in
which each of the contracting parties is located. The report shall be
filed within twelve months of the fiscal year under examination. The
Authority shall pay all costs of such financial audits.
ARTICLE XIII. ESTABLISHMENT AND ADMINISTRATION OF FUNDS.
Funds of the Author i ty may be comingled for investment and
administration purposes. However, each RiSk Management Program shall
be accounted for separately on a full accrual basis.
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The Treasurer shall draw warrants to pay demands against the Authority
when the demands have been approved in writing by both the president
or the vice-president and an agent, employee, or general manager of
the Authority.
The coverage for each Program Year of each Risk Management Program
shall .be as specified in the Memorandum of Coverage or policies of
insurance for that Program Year of the Risk Management Program.
Subject to approval by the Governing Board, which approval shall not
be unreasonably withheld, each Member City shall have the ability to
determine in which Risk Management Program it wishes to participate.
ARTICLE XIV.
WITHDRAWAL.
A. Any Member City which enters a Risk Management Program may
wi thdraw from that Risk Management Program subject to the terms
and conditions as set forth in the By-Laws of that particular Risk
Management Committee.
B. A Member Ci ty is no longer a party to this Agreement upon its
withdrawal from all of the Authority's programs.
C. Any Member City which withdraws as a participant of any Risk
Management Program pursuant to Section B of this Article shall not
be permitted to renew participation in that Risk Management
Program until the expiration of three years from the date of the
Member City's withdrawal.
ARTICLE XV.
EXPULSION.
~he Governing Board may expel any Member City from a Risk Management
Program at any time for material breaches of this Agreement or the By-
Laws. Such expulsion must be approved by the Governing Board members
representing Member Cities in that Risk Management Program or by the
vote requirements for expulsion specified in the By-Laws.
The withdrawal or expulsion of any Member City after the inception of
its participation in the Risk Management Program shall not terminate
its responsibility for the years that the Member City participated in
any Risk Management Program.
ARTICLE XVI.
TERMINATION.
~his Agreement shall continue until terminated. However, it cannot be
terminated until such time all principal for the Certificates of
Participation shall have been retired. Thereafter, this Agreement may
be terminated by vote or written consent of two-thirds of the Member
Cities provided, however, that this Agreement and the Authority shall
continue to exist for the purposes of disposing all claims, the
distribution of assets, and any other functions necessary to conclude
the affairs of the Authority~
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Upon termination of this Agreement, all assets of the Authority shall
be distributed only among the parties that have been participants in
its Risk Management Programs, includ ing any of those parties which
previously wi thdrew or were expelled pursuant to Articles of this
Agreement, in accordance with and proportionate to their net premium
payments made during the term of this Agreement. The Governing Board
shall determine such distr ibution wi thin six months after the last
claim covered by this Agreement has been finalized.
The Governing Board is vested with all powers of the Authority for the
purpose of concluding and dissolving the business affairs of the
Author i ty. These powers shall include the power to require those
Member Cities which were Risk Management Program participants at the
-time of any particular occurrence which was covered or alleged to be
covered under the Memorandum(s) of Coverage or policies of insurance
to pay their share of any additional amount of premium deemed
necessary by the Governing Board for the final disposi tion of all
claims and expenses associated with such loss.
ARTICLE XVII. NEW MEMBERS.
With the approval of two-thirds of the Governing Board, any qualified
city may become a party to this Agreement. Continuing or new
membership is restricted to cities who are members of the Independent
Cities Association and are located in Los Angeles County, Riverside
County, or counties contiguous to Los Angeles County. A city
requesting membership shall apply by presenting to the Authori ty a
resolution of the Ci ty Council's approval of the Joint Exercise Of
Powers Agreement and the individual Risk Management Committee By-Laws
that the ci ty intends to join. The date that the applying ci ty will
become a Member City will be determined by the Governing Board.
ARTICLE XVIII. LIABILITY OF THE AUTHORITY.
Each Member Ci ty agrees to indemnify and save the Author i ty and all
other Member Cities harmless from and against all claims, losses, and
damages, including legal fees and expenses, arising out of any breach
or default on the part of such Member City in performance of any of
its obligations under this Agreement, or any act or negligence of such
Member City or of any of its agents, contractors, servants, employees,
or licensees wi th respect to this Agreement. No indemnification is
made under this Section for claims, losses or damages, including legal
fees and expenses, arising out of the willful misconduct, negligence
or breach of duty under this Agreement by the Author i ty or a Member
City or their officers, employees, agents, or contractors.
The Representatives to the Governing Board and to each of the Risk
Management Committees and any officer, employee, contractor, or agent
of the Authority shall use ordinary care and reasonable diligence in
the exercise of their power and in the performance of their duties
under this Agreement.
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Funds of the Author i ty may be used to defend, indemnify, and hold
harmless the Author i ty and any member of the Governing Board, any
member of the Risk Management Commi ttee, and any employee of the
Authority for their actions taken within the scope of their duties
while acting on behalf of the Authority. Nothing herein shall limit
the right of the Authority to purchase insurance to provide such
coverage as is hereinabove set forth.
ARTICLE XIX.
NOTICES.
Notices under this Agreement shall be sufficient if delivered to the
office of the City Clerk of the Member Cities.
ARTICLE XX.
AMENDMENTS TO THIS AGREEMENT AND COMMITTEE BY-LAWS.
This Agreement may be amended at any time by vote of two-thirds of the
Member Ci ties acting through their Ci ty Council. Amendments to the
individual Risk Management Committee By-Laws require a two-thirds vote
of the Governing Board members representing cities who are members of
that Risk Management Committee.
ARTICLE XXI.
SEVERABILITY.
Should any portion, term, condition, or provlslon of this Agreement be
decided by a court of competent jurisdiction to be illegal or in
conflict with any law of the State of California, or be otherwise
rendered unenforceable or ineffectual, the validi ty of the remaining
portions, terms, conditions, and provisions shall not be affected
thereby.
ARTICLE XXII. AGREEMENT COMPLETE.
The foregoing constitutes the full and complete Agreement of the
parties. There are no oral understandings or agreements not set forth
in writing herein.
ARTICLE XXIII. TERM OF AGREEMENT.
This amended Agreement shall become effective upon the Authority
receiving notice of the approval by the City Council of two-thirds of
the Member Cities.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first written above.
City of
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By --;:)(nt.,-/,,-<--t
,
Title
Vernon
Mayor :i::~rcc~
Executed before me this
29th day of July
, 198 6
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(City Seal)
City Clerk
City of
Vernon
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