City of Chino
CA

Staff Report

Authorize purchase orders with Independent Cities Risk Management Authority (ICRMA) for a total amount not to exceed $87,000 for the payment of assessments for liability from a prior year.

Information

Department:Human Resources DepartmentSponsors:
Category:Purchase

Attachments

  1. Printout

Budget String

Revenue: Expenditure: 6305010-43280 Transfer In: Transfer Out:

Body

BACKGROUND

The City was a participant in the Independent Cities Risk Management Authority (ICRMA), which is a Joint Powers Authority whose intent is to minimize liability expenses by pooling with other agencies for liability claims.  In 2002, the City ended is participation in ICRMA. 

 

ISSUES/ANALYSIS

The City has received an invoice for its portion of assessments due for the 2003-2004 Fiscal Year.  According to ICRMA, during the 2003-2004 Fiscal Year, assessments collected were short of claims/expenses by $2,308,572.  Retroactive collection of assessments is allowed per the Bylaws of ICRMA.  A total of 25 cities who were members in ICRMA during that year also received notification of their respective assessments. 

 

The ICRMA Board, composed of one voting member from each member city, sets funding levels and rates based on actuarial data.  Each member’s loss history, payroll and member retained limit are built into the rates the Board approves at the beginning of a program year.  Once that share is established, it is also the member’s share of any deficit.  Due to multiple catastrophic losses, the losses exceeded the assets during 2003-2004. 

 

The invoice received totaled $13,722, which is the amount that would be payable for the next seven (7) years, totaling $96,054.  However, if the City pays the entire assessment due before July 1, 2017, ICRMA will discount the amount by 10%, or $9,605.  Staff is recommending payment in full of $86,446.  The City has also been informed that additional funds may be sought if additional claims are required to be paid; if so, it is anticipated notice will be made to the City in the 2017-2018 fiscal year.  If additional funds are required, City Council authority will be requested.

 

This request is to issue purchase orders only; no appropriation is required as the expenditures are within the adopted Fiscal Year 2016-17 Budgeted Appropriations. Expenditures are projected to total $87,000.  City Council authorization is required as the combined total of purchase orders will exceed $25,000 authorized to one vendor.

 

 

 

 

 

Meeting History

May 16, 2017 7:00 PM Video City Council Regular Meeting
draft Draft
RESULT:APPROVED [UNANIMOUS]
MOVER:Glenn Duncan, Council Member
SECONDER:Gary George, Council Member
AYES:Gary George, Eunice M. Ulloa, Glenn Duncan, Tom Haughey, Earl C. Elrod