TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL

FROM: CITY MANAGER

DATE: JULY 5, 2006

SUBJECT: JPIA CLAIMS HANDLING AUTHORITY

RECOMMENDATION
Consider the alternatives for claims handling by the California Joint Powers Insurance Authority; select the appropriate alternative and direct staff to notify the JPIA of their decision.

BACKGROUND
This item was continued from the June 20, 2006 City Council meeting in order that all five Council members be present to discuss the alternatives.

The California Joint Powers Authority handles the insurance needs of the City. Under current practice, claims presented to the clerk of the member agency are forwarded to Carl Warren & Company, the third party administrator for the Authority. Carl Warren staff reviews each claim for its merits and contacts the member agency with a requested action. When the determination is made that the claim should be rejected, there are several possible courses of action depending upon the claim and prior actions of the legislative body:

1. The legislative body of the member agency can take no action, and the claim will be deemed rejected by course of law 45 days after it is presented to the clerk. By allowing the claim to be rejected by course of law, the time period in which a lawsuit may be filed is two years from the date of the occurrence.

2. The legislative body may choose to reject the claim at a public meeting and send written notice of the rejection. This reduces the time period in which a claimant may file a lawsuit to six months following the rejection.

Many members have taken the actions necessary to implement the third alternative:

3. The legislative body may, by resolution, delegate the claims handling responsibility to a member of staff. That staff member then rejects the claim, again shortening the time period in which to file a lawsuit to six months.
The City of Rancho Palos currently rejects claims at a public meeting (second alternative).

DISCUSSION
Upon the recommendation of the City Managers’ Committee, the Executive Committee of the California JPIA recently took action to provide members with an additional alternative for the handling of liability claims filed against them. The new alternative would allow the member to delegate the entire claims handling responsibility to the Authority, which would eliminate the need for the member’s staff or legislative body to take action or send letters to claimants.

The new alternative allows further streamlining of the process:

The legislative body may, by resolution, delegate the claims handling responsibility in its entirety to the Authority, allowing the Authority to send notice of the rejection and shortening the timeframe in which to file a lawsuit to six months.

The JPIA has requested that each of its members indicate which claims handling alternative they have selected. Selecting alternative three, or the “new” alternative will require adoption of a resolution. Appropriate resolutions are attached, should the Council select alternative three or the “new” alternative.

Respectfully submitted

Les Evans
City Manager

Attachment: Claims Handling Response Form
Sample Resolution for Alternative Three
Sample Resolution for the “New” Alternative

RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO PALOS VERDES] ESTABLISHING A POLICY THAT DELEGATES BASIC TORT CLAIM HANDLING OF MINOR CLAIMS TO [POSITION TITLE] AS AUTHORIZED BY GOVERNMENT CODE SECTION 935.4

THE CITY COUNCIL OF THE CITY OF RANCHO PALOS VERDES DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS:

WHEREAS, Section 935.4 of the Government Code of the State of California provides that a local public entity may authorize an employee of the local public entity to resolve a claim against the local public entity; and

WHEREAS, the CITY OF RANCHO PALOS VERDES has now determined to adopt such a policy;

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RANCHO PALOS VERDES DOES HEREBY FIND, DETERMINE AND RESOLVE AS FOLLOWS:

SECTION 1. The City Manager is authorized to take administrative actions necessary to resolve claims against the CITY OF RANCHO PALOS VERDES that do not exceed $50,000 pursuant to the provisions of Government Code Section 935.4.

SECTION 2. This Resolution shall become effective immediately upon its adoption.

SECTION 3. The City Clerk shall certify to the adoption of this Resolution.

APPROVED AND ADOPTED this th day of , .

 

Mayor

ATTEST:

City Clerk

RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO PALOS VERDES ESTABLISHING A POLICY THAT DELEGATES TORT LIABILITY CLAIMS HANDLING RESPONSIBILITIES TO THE CALIFORNIA JOINT POWERS INSURANCE AUTHORITY AS AUTHORIZED BY GOVERNMENT CODE SECTIONS 910, ET SEQ.

THE CITY COUNCIL OF THE CITY OF RANCHO PALOS VERDES DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS:

Whereas, the CITY OF RANCHO PALOS VERDES is a member of the California Joint Powers Insurance Authority (California JPIA), and pursuant to Government Code sections 990.4, et seq. and 6500 et seq. pools its self-insured liability claims and losses with other California JPIA members under a Memorandum of Coverage; and

Whereas, the Joint Powers Agreement creating the California JPIA authorizes it to exercise powers common to members and appropriate to defend and indemnify members from liability claims under the Memorandum of Coverage,

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RANCHO PALOS VERDES DOES HEREBY FIND, DETERMINE AND RESOLVE AS FOLLOWS:

SECTION 1. The CITY OF RANCHO PALOS VERDES delegates to California JPIA authority to act on its behalf pursuant to Government Code sections 910, et seq. to accept, reject, return as insufficient, or return as untimely any claims against it, and to provide any notices authorized under those statutes on behalf of the CITY OF RANCHO PALOS VERDES.

SECTION 2. This Resolution shall become effective immediately upon its adoption.

SECTION 3. The City Clerk shall certify to the adoption of this Resolution.

APPROVED AND ADOPTED this th day of , .

Mayor
ATTEST:

City Clerk