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HomeMy WebLinkAbout15638 ORD - 07/16/1980• jkh:7-16-8O;lst AN ORDINANCE AUTHORIZING THE CITY MANAGER TO EXECUTE A CONTRACT WITH THE TML WORKERS' COMPENSATION JOINT INSURANCE FUND TO PROVIDE WORKERS' COMPENSATION INSURANCE FOR THE PERIOD JULY 1, 1980 THROUGH OCTOBER 1, 1983, IN SUBSTANTIALLY THE FORM OF CONTRACT ATTACHED HERETO AND MADE A PART HEREOF, MARKED EXHIBIT "A"; AND DECLARING AN EMERGENCY. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI, TEXAS: SECTION 1. That the City Manager be and he is hereby authorized to execute a contract with the Texas Municipal League Workers' Compensation Joint Insurance Fund to provide workers' compensation insurance for the period of July 1, 1980 through October 1, 1983, all as more fully set forth in the contract, a substantial copy of which is attached hereto and made a part hereof, marked Exhibit "A". SECTION 2. The necessity to immediately enter into the aforesaid contract in order to effect the terms thereof creates a public emergency and an imperative public necessity requiring the suspension of the Charter rule that no ordinance or resolution shall be passed finally on the date of its introduction but that such ordinance or resolution shall be read at three several meetings of the City Council, and the Mayor having declared that such emergency and necessity exist, and having requested the suspension of the Charter rule and that this ordinance be passed finally on the date of its introduction and take effect and be in full force and effect from and after its passage, IT IS ACCORDINGLY SO ORDAINED, this the /(04t—day of July, 1980. ATTEST: APPROVED: 16th DAY OF JULY, 1980: J. BRUCE AYCOCK, CITY ATTORNEY 15638 CITY OF CORPUS CHRISTI, TEXAS MICROFILMED' 146 2 1 1000 At the end of each and every Fund Year, there shall be submitted by the Employer Member actual payrolls as reflected by the books of the Employer Member, and any additional amounts payable to the Fund based upon the actual payroll shall be paid, and lesser amounts payable shall be adjusted by refund to the Employer Mem- ber. The Fund reserves the right to audit the payroll records of any Employer Member. Annual field audits will be made on each Employer Member with standard consideration estimated to exceed $30,000. A field audit will be made at least once every 3 years on Employer Members with standard consideration less than $30,000 annually. For each new enrolling Employer Member, a pre -audit contact will be made to counsel proper payroll classifica- tions and record keeping, and a fleld audit will in all cases be made covering the first year. In the event that the Employer Member falls or refuses to make the payments of premiums as herein provided, the Fund reserves the right to terminate such Employer Member by giving ten (10) days written notice and to col- lect any and all premiums that are earned pro rata for the period preceding contract termination. 4. The Fund has obtained aggregate stop -loss reinsurance up to $20 million, to assure that the Incurred losses for the total Fund shall not exceed the maximum 75% of standard premium paid or payable by Employer Members Into this Fund. In addition, the Fund has catastrophic loss protection In excess of $400,000 for any one accident or occurrence, to a limit of $30 million, covering the contract period. The reinsurance Is provided so that Employer Members will have no joint or several liability other than the maximum 75% of standard premium payable and to Insure that the Employer Member shall at no time be on an assessable bests beyond the amount set forth In this Interlocal Agreement. The Board, however, reserves the right to adjust either one of these rein- surance provisions In the event that the fiscal soundness of the Fund will justify such adjustment and result In a savings to the Employer Members. Before any such adjustment Is made, notice will be given to all the Employer Members together with an accounting from the Fund, In order that the Employer Members may appear before the Board to discuss the fiscal soundness of the Board's action. 5. The Fund has contracted with the Servicing Contractor to supply safety engineering services to the Em- ployer Members to assist them in following a plan of loss control that may result In reduced losses. The Servic- ing Contractor shall provide all of the services as provided In the service contract entered Into by and between the Servicing Contractor and the Fund on behalf of the Employer Member. The Employer Member agrees that It will cooperate In instituting any and all reasonable safety reputations that may be recommended for the purpose of eliminating or minimizing hazards that would contribute to workers' compensation losses. In the event that the recommendations submitted by the Servicing Contractor on behalf of the Fund seem unreasonable, the Ern- ployer Member has a right to appeal to the Board of Trustees. The Board shall hear the objections of the Em- ployer Member at Its next regularly scheduled meeting and Its decision will be final and binding on all parties. 6. The Employer Member agrees that It will appoint a worker's compensation coordinator of department head rank, and that the Fund and Its Servicing Contractor shall not be required to contact any other Individual except this one person. Any notice to or any agreements with the workers' compensation coordinator shall be binding upon the Employer Member. The Employer Member reserves the right to change the coordinator from time to time by giving written notice to the Fund and to the Servicing Contractor. 7. The Fund, through the Servicing Contractor employed by the Fund, agrees to handle any and all claims after notice of injury has been given, to prepare all required Industrial Accident Board forms, and provide a de- fense. The Employer Member hereby appoints Servicing Contractor as Its agent to act in all matters pertaining to processing and handling of workers' compensation claims and shall cooperate fully In supplying any Informa- tion needed or helpful In such defense. They shall carry on all negotiations with the Injured employee and his at- torney at the prehearing conference and negotiate within authority previously granted by the Fund. If a personal appearance by the employer or a co -employee is necessary, the expense of this appearance will be paid by the Employer Member. The Servicing Contractor will retain and supervise legal counsel on behalf of and at the ex- pense of the Fund necessary for the prosecution of any litigation. All decisions on Individual cases shall be made by the Fund through the Servicing Contractor, which Includes the decision to appeal or not to appeal an in- dustrial Accident Board's final ruling and decision. However, any Employer Member shall have the right In any case involving one of their employees, to consult with the Fund on any decision made by the Servicing Contrac- tor. The Board shall hear the objections of the Employer Member at Its next regularly scheduled meeting and their de- cision will be final and binding on all parties. Any sult brought or defended by the Servicing Contractor and the Fund shall be In the name of the political subdivision. Notwithstanding any provislons of this paragraph, all re- ports and filings required by the Workers' Compensation Law and the Industrial Accident Board of any employer will be the responsibility of the Employer Member. It Is further understood that this agreement does not cover discrimination sults under Article 8307c. There shall be supplied periodically to each Employer Member a com- puter printout Involving a statement of claims, claims status, and activity report cumulative for each Fund Year. 8. The Employer Member acknowledges that It has received a copy of the Bylaws of the Fund and agrees to abide by the Bylaws and any amendments thereto. 9. The Fund agrees that all Fund transactions will be annually audited by a nationally recognized, certified public accounting firm. 10. The Fund shall pay on behalf of each Employer Member the Industrial Accident Board maintenance tax (Ar- ticle 8306, Sec. 28, V.A.T.S.) and file the necessary tax forms with the Internal Revenue Service. Map WORKERS' COMPENSATION JOINT INSURANCE FUND 1020 Southwest Tower, Austin, Texas 78701 INTERLOCAL AGREEMENT This Contract and Interlocal Agreement entered Into by and between the Texas Municipal League Workers' Compensation Joint Insurance Fund (hereinafter referred to as "Fund") and the undersigned political subdivi- sion of the State of Texas (hereinafter referred to as "Employer Member") for the purpose of providing the statu- tory benefits prescribed by Article 8309h of the Texas Workers' Compensation Act for employees of political subdivisions. WITNESSETH: The undersigned Employer Member in consideration of the adoption of a plan of self-insurance as authorized In Article 8309h, Vernon's Annotated Texas Statutes, to provide Workers' Compensation benefits at a minimum cost and In further consideration of other political subdivisions executing identical Interlocal agreements does hereby agree to become a self -Insured workers' compensation employer by becoming one of the members of the Fund Pool of self -Insured Employer Members. The conditions of membership agreed upon by and between the parties are as follows: 1. Definition of terms used In this Interlocal Agreement. 'a. "Board"—refers to the Board of Trustees of the Texas Municipal League Workers' Compensation Joint Insurance Fund. b. "Premium" and "Contribution"—are used Interchangeably in some parts of this Interfocal Agree- ment. "Premium" is used to Identify the rating formulas established by the State Board of Insurance, which are used as guidelines to establish Employer Members' cash contributions to the Fund. Any reference at any time In this Interlocal Agreement to an insurance term not ordinarily a part of self-in- surance shall be deemed for convenience only and Is not to be construed as being contrary to the self - Insurance concept except where the context clearly Indicates no other possible interpretation such as but not limited to the reference to "reinsurance". c. "Servicing Contractor"—Texas Employers Insurance Association. d. "Manual Rates"—the basic worker's compensation rates applicable to each classification of em- ployees promulgated by the State Board of insurance. e. "Experience Modifier"— refers to the factor applied to the manual rates that reflects the political subdi- visions' loss experience, which is based on the State Board of Insurance promulgated insurance plan. f. "Standard Rates"— rate that Is determined by applying the experience modifier of each Individual Em- ployer Member to the annual rates. g. "Fund Modifier' -75% that is applied to the standard rates by the Fund to reflect the savings to the Employer Member by entering into the Interlocal Agreement. 2. The term of this Contract shall be for a term commencing 12:01 a m July 1, 1980 and terminating 12:01 a.m. October 1, 1983, unless the same Is sooner terminated by sixty (80) days written notice of Intent to terminate by either party unless otherwise specified under the terms and agreements of this Contract or by the Bylaws of the Fund. The Fund will have the right to terminate this agreement only for noncompliance with paragraphs 3, 5 and 8. 3. Annually, each Employer Member shall submit to the Fund, on a Premium Worksheet form supplied try the Fund, Its estimated payroll for each classification of employees. The rates established by the State Board of In- surance shall be applied to arrive at a manual premium. If the Employer Member has established, through expe- rience, a modifier, then the experience modification of that Employer Member shall be used to arrive et the standard premium to be paid by the Employer Member. In the absence of an earned experience modification for the Employer Member, the manual rate as established by the State Board of Insurance In effect, at the beginning of each Fund Year, will be used as a guide to produce a manual, as well as a standard, contribution. The Fund modifier of 75% shall then be applied to the standard premium to produce the annual contribution that the Em- ployer Member shall pay to the Fund. The Employer Member agrees to pay the standard annual contribution to the Fund in twelve (12) equal monthly Installments, In advance, commencing at the beginning of each Fund Year, with subsequent Installments due the first of each month thereafter, provided that if the payable annual contri- bution shall be less than $5,000, it shall be payable In four (4) equal quarterly installments, In advance, com- mencing at the beginning of each Fund Year, with subsequent Installments due the first of each quarter there - atter. It Is understood by the Employer Member that there will be contribution adjustments based upon the In- creased benefit levels mandated by the Texas Workers' Compensation Act. 11. As the administrators of the self -Insurance Fund, the Board shall primarily and constantly keep fore- most In their deliberations and decisions in operating the Fund that each of the participating Employer Mem- bers Is a "self -Insured". At least annually, the Board shall carefully review, study and consider the actual claims or loss experience (Including reserves for future claims payments) of each of the Employer Members, the experi- ence rating modification developed or earned by each of the Employer Members, the pro rata savings to the Fund resulting from overall loss experience attributed to each Employer Member, and the pro rata portion of the cost of all catastrophic loss protection reinsurance and aggregate stop loss reinsurance allocated to each Employer Member, as well as the pro rata allocation, as determined by the Board of the other and necessary administra- tive expenses of the Fund, In order to reasonably determine the actual pro rata cost, expense and loss experi- ence of each Employer Member in order to maintain as nearly as possible an equitable and reasonable "self-in- surance" administration of the Fund as applied to each Employer Member. The Fund shall maintain case reserves and supplemental reserves computed in accordance with the stan- dard actuarial principles, taking Into account historical and other data, designed to measure claims develop- ment and claims incurred but not yet reported, so that funds will be available to meet these claims as they be- come due. The Fund shall also establish and maintain a reserve for Return of Contributions to Insure further the fiscal Integrity of the Fund In the event of a potential, adverse loss development. This Reserve shall be calcu- lated on a Fund Year basis, and shall be held for a 12 -year period in decreasing amounts computed as a percent of standard contributions, as follows: 10% First Fund Year Past 10% Second Fund Year Past 10% Third Fund Year Past 8% Fourth Fund Year Past 6% Fifth Fund Year Past 4% Sixth Fund Year Past 2% Seventh Fund Year Past 2% Eighth Fund Year Past 2% Ninth Fund Year Past 2% Tenth Fund Year Past 2% Eleventh Fund Year Past 2% Twelfth Fund Year Past 0% Thirteenth Fund Year and Beyond The Fund shall determine Its net income for Federal income Tax purposes at the close of each Fund Year. The Fund's Income so determined shall be distributed to Employer Members, on or before the April 1 following the close of the Current Fund Year, pursuant to the following dlstri6ution formula The Fund shall distribute to Employer Members the sum of the Current Fund Year Savings and the Addi- tional Fund Year Savings. Current Fund Year Savings shall equal the excess of contributions and other Fund In- come, over (a) incurred losses (less reinsurance losses), including the amount of any Actuarial Reserves, ex- pense and other amounts which are allowable as deductions for Federal Income Tax purposes, (b) the amount, if any, of any Actuarial Reserves for the Current Fund Year in excess of the addition to these Reserves allowable as deductions for Federal Income Tax purposes for the Current Fund Year, and (c) the Reserve for Return of Contributions for the Current Fund Year, Additional Fund Year Savings shall equal (a) amounts, If any, Included within any Actuarial Reserves for any prior Fund Year, the retention of which on an actuarial basis Is no longer necessary, and (b) the sum of the net decreases, if any, In the Reserve for Return of Contributions for each Fund Year prior to the Current Fund Year after adjustment for loss development attributable to such prior Fund Year. The Fund shall Issue a certificate to each Employer Member, which shall evidence its share of the fund's net Income, as determined for Federal Income Tax purposes, which is retained and to be returned under the For- mula for distribution of such net income. A certificate shall be issued under this procedure for all prior Fund Years. IN WITNESS WHEREOF, the parties have hereunto set their hands by their representatives thereunto duly authorized this 15th day of July 1980 Contract Number The Workers' Compensation Coordinator for the Employer Member Is: NAME ADDRESS CITY ZIP TEXAS MUNICIPAL LEAGUE WORKERS' COMPENSATION JOINT INSURANCE FUND BY Fund Secretary Austin, Texas FOR CITY OF CORPUS CHRISTI Employer Member BY Authorized Official R. Marvin Townsend, City Manager TELEPHONE Corpus Christi, NUeces County ,Texas ATTEST: APPROVED City Secretary J. BRUCE AYCOCK, CITY ATTORNEY By Assistant City Attorney • SUPPLEMENT TO INTERLOCAL AGREEMENT TML WORKERS' COMPENSATION JOINT INSURANCE FUND In consideration of the Employer Members' request for payment of additional benefits and In further consid- eration of the Fund's agreement to pay such benefits, the Interlocal Agreement is amended by adding thereto the applicable coverages: Volunteer Firemen and Police Reserves—The Fund will pay on behalf of the Employer Member, if an em- ployee within a public safety officer group of employees hereinafter described, shall sustain Injury, including death resulting therefrom, under circumstances which would have rendered the Employer Member liable for compensation If the injured employee and the Employer Member had been subject to the Texas Workers' Com- pensation Law with respect to such employment, an amount equal to the compensation and other benefits which would have been payable under such law had the Injured employee and the Employer Member been sub- ject to such law with respect to such employment. The parties of this agreement do not by Its use Intend to make applicable to themselves any provision of the Texas Workers' Compensation Law not already in force and effect as to them. The reference to the Texas Workers' Compensation Law Is Intended as a measure and extent of benefits and the liability therefore and not an adoption of the law. Elected Officials—If a resolution of the governing body has been adopted providing coverage for elected officials as required by law, such elected officials while acting within the course and scope of their official duties, shall be covered by the Interlocal Agreement as any other employee of the political subdivision. The Employer Member agrees to pay the premium for the payroll classifications checked below. Description of Group of Employees Elected Officials Code 8742 M Volunteer Firemen Code 7704 0 Police Reserves Code 7720 This agreement shall be subject to all the terms, provisions and conditions of the interlocal Agreement, and nothing herein contained shall vary, alter or extend any term, provision or condition of the Interlocal Agreement except as herein specifically stated. This agreement shall be effective on Jn1Y 1 tg 80 Contract Number TEXAS MUNICIPAL LEAGUE WORKERS' COMPENSATION JOINT INSURANCE FUND By: Fund Secretary By: Employer Member Corpus Christi, Texas day ofd— , 1900 TO THE MEMBERS OF THE CITY COUNCIL Corpus Christi, Texas For the reasons set forth in the emergency clause of the foregoing ordinance, a public emergency and imperative necessity exist for the suspension of the Charter rule or requirement that no ordinance or resolution shall be passed finally on the date it is introduced, and that such ordinance or resolution shall be read at three meetings of the City Council; I, therefore, request that you suspend said Charter rule or requirement and pass this ordinance finally,on the date it is introduced, or at the present meeting of the City Council. The Charter rule was Luther Jones Edward L. Sample Dr. Jack Best David Diaz Jack K. Dumphy Betty N. Turner Cliff Zarsky Respectfully, MAYO THE CI a CORPUS CHRISTI, TEXAS suspended by the following vote: !C ab- The above ordinance was Luther Jones Edward L. Sample Dr. Jack Best David Diaz Jack K. Dumphy Betty N. Turner Cliff Zarsky passed by the following vote: 15638