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CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION
ORIGINAL
Subject: Resolution approving and
authorizing the execution of the
amended and restated Big
Independent Cities Excess Pool
(BICEP) Joint Powers Authority
Agreement and approval and
ratification of the new operating
documents as provided in the
attached Resolution.
From:
James F. Penman
Dept:
City Attorney
Date:
June 1, 2006
MICC Meeting Date: JUNE 19, 2006
Synopsis of Previous Council Action:
On March 28, 1988, the Mayor and Common Council adopted Resolution No. 88-354, a Resolution of the
City Council of the City of San Bernardino approving and authorizing execution and delivery of a Joint
Powers Agreement creating the Big Independent Cities Excess Pool (BICEP) Joint Powers Authority,
authorizing the execution and delivery of a liability risk coverage agreement and the filing of a validation
proceeding and certain other actions in connection therewith.
On November 17, 2003, the Mayor and Common Council adopted Resolution No. 2003-301, a Resolution
of the City Council of the City of San Bernardino amending the liability risk coverage agreement and the
Joint Powers Agreement creating the Big Independent Cities Excess Pool Joint Power Authority,
approving the prepayment of basic premium, and authorizing, ratifying, and approving certain other
documents and actions in connection therewith.
Recommended Motion:
That the Mayor and Common Council approve and authorize the execution of the amended and
restated Big Independent Cities Excess Pool (BICEP) Joint Powers Authority Agreement and
approve and ratify the new operating documents as provided in the attached Resolution.
Signature
Contact person:
James F. Penman
Phone:
384-5355
Supporting data attached:
Yes
Ward:
City Wide
FUNDING REQUIREMENTS:
Amount:
No cost
Source: (Acct. No.)
(Acct. Description)
Finance:
Council Notes: j, rolP -I '7 :c
& /li JOt,
Agenda Item No. 1 .
CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION
Staff Report
Subiect:
Resolution of the City of San Bernardino approving the amendment and restatement of the joint
powers agreement creating the big independent cities excess pool joint powers authority
("BICEP"), and authorizing, ratifying, and approving certain other operating documents in
connection therewith.
Backl!:round:
BICEP was initially formed in I988 in response to the extreme difficulty cities were having in
obtaining liability insurance coverage. The cities of Huntington Beach, Santa Ana, San
Bernardino, Oxnard and Pomona were the charter members that formed BICEP. Subsequently,
the City of Pomona withdrew and the City of West Covinajoined BICEP in October 2003.
In order to provide adequate reserves for coverage liability, BICEP issued bonds in 1988
and as a further consequence entered into certain legal "operating" documents to provide the
necessary and required protection for bondholders. More specifically, the Liability Risk
Coverage Agreement and Trust Indenture were specifically crafted to ensure that the premiums
paid in and the settlements paid out under the liability coverage program, were administratively
handled to protect the interest of bondholders.
In October 2003, BICEP decided to retire the bonds and with the ratification of the City
Councils of each Member City, undertook necessary actions to defease the bonds in March 2004.
With the retirement of this bonded indebtedness, the BICEP Board (the "Board") has been
diligently working to revise the "operating" documents to remove the now unnecessary and
burdensome provisions related to bondholder protection. The goal of the Board is to replace the
existing operating documents with new operating documents that ensure efficiency in handling
claims and provide clarity in the obligations and rights of each Member City in BICEP.
With these goals in mind, the amended and restated Joint Powers Agreement, along with
the new operating documents are being presented for your review and' approval. These
documents are intended to fully replace the existing joint powers agreement and operating
documents originally entered into in 1988, with one exception. That exception relates to how a
charter member i.e., Huntington Beach, Oxnard, San Bernardino and Santa Ana, will continue to
participate in the reserves for liability coverage created by the now-retired bonds. To this extent
only and subject to the final disposition of all claims which occurred prior to the defeasance of
the bonds, the terms and conditions of the existing Liability Risk Coverage Agreement would
remain in force and effect. Otherwise, on or after July I, 2004, the rights and obligations for
coverage of any Member of BICEP would be controlled under the proposed operating
documents, if approved.
In drafting the new Joint Powers Agreement and each proposed new operating document,
the following policy issues were discussed at length by the Board in consultation with each
Member City's Risk Manager and City Attorney.
Policy issues:
I. The Joint Powers Agreement and the proposed Bylaws will broaden the definition
of "Member" from any "California city which has executed the Agreement (i.e., the Joint Powers
Agreement)" to "any public agency as the term 'public agency' is defined by Section 6500 of the
Joint Powers Law" (the Joint Exercise of Powers Act, Government Code Section 6500 et seq.).
The intention is to allow other types of public agencies e.g., the Los Angeles County Community
Development Commission, or even an out-of-state public agency, to potentially join BICEP and
to share in the distribution of risk and thereby reduce each Member's risk as well as
administrative costs.
2. The proposed Bylaws would include and change the eligibility criteria for
admission to BICEP. More specifically and in addition to the revised definition of "Member",
the eligibility criteria would delete the requirement for "population of at least 100,000". This
would allow consideration of smaller-population cities to join BICEP. However, other
underwriting criteria related to a new member's potential impact on BICEP coverage, such as a
new member's "loss experience", would remain in place and continue to be applied. Again, the
intent is to enlarge membership to share risk, but not to the detriment of BICEP's financial
condition.
3. The proposed new Bylaws, if approved by each Member City, would clarify that
the Board of BICEP has the authority to make substantive revisions to the operating documents
and the terms and conditions of coverage for the Members. Currently, pursuant to the existing
Liability Risk Coverage Agreement executed in 1988, any such revision to the existing operating
documents would require a two-thirds vote of the Board of BICEP and a two-thirds vote of the
Members' city councils. This vote of the Board and ratification by the city councils was
intended to provide protection for bondholders. However, with the retirement of the bonds, the
procedure provided in the Liability Risk Coverage Agreement creates inefficiency in responding
to coverage market conditions.
Each Member City continues to protect its individual interests through the City Council's
designation of the representative to the Board. Additionally, the new Bylaws continue to require
a supermajority vote of two-thirds to add or expel a member. Such controls are typical and a
normal means of control found in other joint power pools.
4. Pursuant to the Bylaws, coverage for each Member of BICEP would be provided
through a Memorandum of Liability Coverage and through various Risk Management Programs
determined and authorized by the BICEP Board, which is a similar procedure in other such
pools. However, these new Operating Documents would revise certain existing coverage
policies, as follows:
a. The Liability Program will establish new limits to BICEP's coverage at
$10 million per occurrence and $25 million annual aggregate for all claims.
(Liability Program, Section 2.1.3) BICEP's exposure under the existing operating
documents is $25 million per occurrence in each Coverage Period without any
aggregate cap.
b. As noted earlier, the terms and conditions of this Liability Program may
be amended annually by the BICEP Board to adjust to "market" demands.
c. The Liability Program recognizes that liability coverage may be provided
by adopting a "Reverse Following Form" which suspends the terms and
conditions of the Memorandum of Liability Coverage and accepts a commercial
insurance policy form as the basis for coverage.
d. The Memorandum of Liability Coverage would clearly provide for
coverage of a LAND USE CLAIM in the event no such coverage was available
through commercial insurance or reinsurance. However, such coverage would be
limited per Member to $5.0 million per occurrence and $5.0 million per annual
aggregate.
LAND USE CLAIM-means any CLAIM, other than for INVERSE
CONDEMNATION, arising out of the enactment of any zoning ordinance,
specific plan, general plan, or similar regulation or use or improvement of real
property, and the granting, denying or the conditional granting of a discretionary
entitlement in the use of real property such as but not limited to, a conditional use
permit or variance.
As earlier stated, the intent of the BICEP Board in bringing the amended and restated
Joint Powers Agreement and the underlying revised Operating Documents to the City Council is
to promote efficiency in handling Member's Claims and to provide clarity on the obligations and
rights of each Member in BICEP. The listing of policy issues is not intended to be exhaustive,
but hopefully outlines the major issues that need to be considered.
Financial Imnact:
None
Recommendation:
That the Mayor and Common Council approve and authorize the execution of the amended and
restated Big Independent Cities Excess Pool (BICEP) Joint Powers Authority Agreement and
approve and ratify the new operating documents as provided in the attached Resolution.
F:\MILLIGAN\Risk Management\Bicep\6-19-06 SR.BICEPJoint.Powers.Agreement.doc
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RESOi 1110;\ ClF TilE ~.I,\ y(Jl( '\:~1~-~:\1\1(~~- COl:\JCiL OF ('11''1 01- :-;.\t)
BER:"AIWIMJ /\PPRo\l:"G THE A\II::\I)\H:NT /\;\D R1,Sl,\1 L\1E1\T 01 TilL .I(JJ:~l'l
I'O\VERS i\GREEI\ILNT CRL\TI\'G lllE BiG IND[I'[t,DENT CITIES U((..T::;S !)O()I~
.I01\)T PO\\'FRS AUT] JOkITY, ,\\)1) I\l)'l JI()RllING, [Z.\TIIYING, AND\I'I'ROVI~;q
U:KL\I:-.i OTlILR (JPIRAIfl\G LJOCLI\1LN1S I~j Cm,!'\EClIONI i !EFLWllJ I
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\\'IIERE,\S, tl,e City or S.:11 Bern:!rdillo is a municipal ce1rporaliol1 orc:al1i/e,1 andl
eXisting under alld l'y virtue or tlie con:,litulion and 1:1\\'5 or the StJte of CaliCol'lliJ (tlie "City") I
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" I WI IFREAS, the Cities uf Iluntingtoll Beacli, Oxnard, West Covina, San 13erI13rdillo, andl
J 0 I Sallta l\n3 nre tlie eunent !\1em!Jers of the Big Indepl'lldcllt Cllies Excess Pool .I01l1! f'<>v'LTI
: 1 II Authorit)', a joillt exercise of powers entity organized and ex iSling tinder the laws of till' Stale J
12 CdillJrllia (the "Authority"); ami
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WIIERLAS, each r...1embn of tl1" Autliority clllcrcJ ir,to that clTtili,\ JOINT ['OWFI<'
i\GRf'.EM[NT CREA Tl:\G TIll' BIG INDLJ'LNDENT CITiLS LXCTSS POOL JOIN-II
POWERS ,\UTlIORITY. cxeclltl'd :md dcl!\l'I'Cd il\ Jill! dnCr S,'ptcmbcr In:;,:ls SldlSe"llI<:ntIJ
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amended: J.nd
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\\'IIUZL/\~;, the ;\uLhu; ;iy d)iJ1r"v",[ ,1I,,1 clllered !l1lc) ccrtaill Llpcl~iinE dC/Clime;;\:; ((1
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carr\' OUllhc purpuse oj' the /\lllhority to Jointly develup and fund plr:Jf.r;J:1lS [l)r C)Jllp]~:k_';l.';i\T
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liabilitv covcr""c ilnd olber covcrJ:ces. IIleluding bill nol limited 10 Ihbws Ihe I.iabilitv Ris!,
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Cuvcragc /\grccll1cnt, .1 r'\kmo[tindum or Liability Coveragc, and the 1'ru\1 Af;rcClllcllt, ;t/'
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original I)' dated a:; of October I, I ysg ""d sdbsequcnlly amended from lime In time (the
, "Orl,l~_inCl! Operating nOClllllCll:5~'): ~lIld
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IU'-OII'J JO', CI lIJL ~L\ YOIZ AND CO\I~l()\: CO: ::,,J II 01 U J\ Of S.\:J
m,RN.\rm:\:o Af'PRO\'I'~C;IJIl ,\\lI':':D'dL>;T !\?\n RESTAlU,II:<T OF TIIII{'!;'lj
I'O\\LRS ,ViRIL\H:;<T u'1','\ 11\:(j TIlE IllG IN !)JYU\Ii LNT C1 j ILS LXUS,~ !'CI()!,
.I01!\[ POWlR,S :\l.'II[OFn Y. AND ;\I,TIIOl\171""G, It\TlrY!~!G.\:\j) ,\PPIW\'INd
CLFT..\I:\ OTIiLlZ OPLRXiT<Cj j)OCI"~IJ:\! IS I>i CO;\,\LC1IU;, T! ILRI,\\'IIII i
WIILF,EI\S, tile Authority fntered intu the Em\1u! the Original Opcratill:\ J)'lCtllliCnl:i i"~
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order to lSSUC' bonded mdc+tcdl1c.)s in Oclobcr 19;';8 tv fund the I1cccssar)' rTSlT\CS It)]' till
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comprehensive IlillJillty covcnlge provided 10 Ihe Members orthe Authori:y; anJ
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WIILREAS, in October ~()OJ, tlie Authority, \\ ith the subseque"l approval and
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ratification or the City Cuullcil or each 1\lemher, Jetennincd and approved J(tj,1\lS to dclcas(' all<~
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:etire said bonded indebtedness in Malch 200-1; and
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WIIERE;\S, the AUlhority now desires to <lrnclld dlld restatc Ihe l~lI'Ill or liS op':rcilli11
dOeUlnCllts ill ordcr to provide eLirit) anJ efficiency in prO\rJing covera:;c', 10 lis i,kmbcrs, andj
to allow the cxpamio!\ or mcmbersh'l) in the /\uthorit)' to allY publiC agency, as Ih'lt tcrm 11
delincd ill the Calir,lrnia Governmcnt Code cOnlmcncing al SectiOll (,,,00 cl scq ; and I
WIIEREAS. thc Cit)' de:mcs to approve, ratiry, and eonlJrll1 ill all respects all pre\'it'u'l
action:; taken b)' the City or any mcmber or Ille l\1ayor and COll1l1lun C"uncr! ,;!, this ('it)' (th<:/
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"Common Council") or any oihcr orficcr or stilrr rnelllber lJr lite City WIllr resp"cl to Ilrq
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WIIERFA S, lire rorms or Ihe followillg documents arc on [ik \vith tbe Cily Ckl k or dl",
City (tire "Cit)' Clcrk") and have been SUblllittcd to this CII)' CouncIl, dnd the Fisk ;qa,,;rgcr 011
the City (Ihe "Risk Manager"), who in consultation with the City Attorney or tltc Ciiy (lhC!
, "Cil)' Allome)'''). has examincd and aeproveJ eJch document and has reeomrrkndcd ll1.1l (IrJ
" ,I Ci<, C"",,,,, d I,,,, ,'" """1""",,", 1'1"" "PI" "P"''', ",,1 "'" ,,,,,,,,;,,,, ""d Jd""y "r ''''',1
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, 1:.I:-;OU'110;'; OF TIlE \1.\YOFVm (O\I:,1()'; C(ll",CII OF (I i y en S \1"1
:: H!:/{:\AiWIC-.() .\I'i'/{O\'I~'(; TilE A\II:m:\IL"'T /,'-.:1) RI'S1.\Il:MU; r Of Ilil JCJI'\i Ii
1 Ii I'O\\IX'i .'\(jRIT\H"'\T CFL\TI.,\(j 'J J IE BIG I;\DLPINDI::,T CIIILS I:XllcSS 1'001 j
1.101;\ r. I'OWLRS AUTHORlI Y, .'\NO AL.:TI JORI/I1\iC.', .IC-\T1FYJ'JCj, N,I) /\I'I'ROVn,Cjl
UX[\I,,\ OIliER OI'LRi\"1 IC-.Ci DOCU\IEN rs 1:\ C:.l'\'<ICTlU\: llIUJL\VIIII I
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;: I NOW, TIIU\ITOFF, th~ Mayor and COlIlmon COllncil (If thc Clly (If 5'11l Ikrn:lrJino d'i"
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(a)
the Juint Fowers /\.grcclllCn!;
(b)
the r\l11ended Bylaw::,
(c)
the Memorandum of I.iability CoverJ);,e;
(d)
the Liability Program,
(e)
the WOlker,' Compensation PrograJ11.
IIerehy fmd, determine. Icsolve alld order 31; follows:
SECTfON 1. The j(lrcgoing reCitals, and each of them, :lIe true alld cnrr~cl.
SECTION 2. The ilmended and re.ctatcd .l(lint l'emers '\t'rcel11cnt on file "Jih tl1c Cil"
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Clerk is approved in sllbstClnti:llly the rurlll pre';cntcd <It Ihis mceting Tile \!:tYCll 1:, lil'r~l)\l
autlwri;:eJ ane.! directed, lor and ill the "ame 11/' the City, to ex,x'uk <lnd lklivCl the ],1[nl l'uI' u,~
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:\grccl1lcl1t emu such JpprovaJ to he conclusively evidenced by the cxccutinll <.Ind dcll\(T)
: 'J Ithereof
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SFCTJON 3. The amender! and rcstalcJ form of the Oper<lldcg Oocumcnts of
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Authority as listed herein<lbovc arc hereby ratified and approved and the Origll1al operiltin!1
~ 3 t Documents shall no longer be in force and cf/Cct in accc:rda:lcc and <.I'; pro\"idcd In tll(>~C: I1C\\1
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')'1 ! I GpcrZlting Docurncllts. I
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l'j.S,"lll'"")(')', 'II: 1'11'1' (~I'IY (e'(I' "\(11 Ii': ('I!"j' (e)(,: S"" le3"',''\;'I''110JrJ' :\1'[,"'1\'1',1
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IIIL i\\IH\I)\1:::<r .\'.;1) RbT,,\IU.1f";T (If-IIII: .llll'.;l 1'()\lL/(S i\(jfZ!T\lii"i
n:;:.\'II\(; TilL IWi J:~[)U'C,lJl>n CI1II:S I.xcr~s I'OC'L W[Nr I'lJ\\'L!Z~;i
.\\JTlIORIIY,.v<]) ,\I'TIJOIZ llli<Ci. RXIII'dMi. ,,\:~[) ,\I'I'IZO\I0:(j C[XI AIJ\ UII ',FI
OP!:R!\ 11:<(; DOCUi\lf.:"n S 10: lOH,a:CI IV~ T1IIYL\\11 i I I
SECTION 4. The .\'byt>). ,hc City CIe:k, the City \lIorne\, and an\' (,(her )JIc'I"'" Uifll"'~
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oj' the CI:Y Zlrc hereby allt!1()]"]zcd ~l11J JJrectcJ, jointly :~nd severally, to Jl) ;IllY ilr;J .ill 11l11!L~~' all,11
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I to execute and dejj"er allY ,1;ld all documents IlCC('SS;lry or propel relr Ciury;ng !)ul 1hc ~]cliun'
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c,)ntcrnp[3tcd by this Resolution or any of the doculllcnts rcfr:rrcd 10 hercm,
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seCTION 5. /Iny dlJCul11cnt. the execution of "hiell by the IvLly,'r, the Cily Clnk. II"j
Atlorney, or any other proper ollleer of the City" dllthorilcd by this IZesollltlun. slnll, i:l
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illll!loriI.cd dc:,:ignc(' r~r :~\Ichl
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I thc absence or in;rbililY to .'let of such o{'lIeer, k ex,:cuted hy anv
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officer, :,;llCh allthtHl/.alion {o be givcn ill V\'Tifin[.
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SECTlO\' 6 :\11 aCi;,)ns previously taken by thIS !vLrvor 3l1J COllllllon COi:l1cd ;rilel ill'
j c [Ihe ,,;ficcls Zlnd suiT of the City \\'ith respect to the meltlers ;)ddrc:;~;ed
] G ! hereby approved. ratdicd, and cOlllirnwd in all rL':;pccIS.
by thi:; !.~2~)()IIJl1~'dl ;il't
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This Resolution shall immcdidtcly lake dTcct from and aner ils date or adoption
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1H;Z;";.\RIlI?\O i\i'I'RuViN,; IIIL ,i\lL:,,;I)~,HXI.'\'''' RESTin:\H:NT ()! T!l1 JI'iN1j
PO\\LRi, ACiRID1L', r CIU.\IIi\C TilL [ll(; Irmll'li'UEl\ I ('!TILS IXCIS.' I'IJUIj
.i(w,n I'OWHlS Al'liIURliY. AND AL:TIIOlZlllr\(i. RATIFYING. 1\0:11 AI'I'IZUVI',(,i
eFRT\I:>; or HLR OI'I:P.XIT:,C1 DOC '\IFNTS IN CC)!',,,TCTION 'IIILREWITI! i
I I IIRUJY CU,T1FY Illat the fl'rcgll!ng ResolutIOn WJS duly adopted h) ll:c ('"mr1'n,j
COllnc,1 of Ihe (,i1)' or San Ecrnardllw m a __________.___._ meeting therel'I-. held 011 tl1,j
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________ d<lY uf _.__,__.~___._ __________, 200(1, by the j'olitl\\illb \'ole, to 'vvit
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COUl\CIU\lG1IJLRS.
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The foregoing
IS
resolutiun
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Approved as to [urm.
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JAMES F. PENI\IAN.
< ,I City Attorn.~y
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By:
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ABSEN r
Rachd (j. Cl<lIk, (',l,,' Clerk
hereby 31'provcJ
this
Patrick .I. Morris. :vla)ur
CIty of S~.Jn BcrnnrJilld
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JOINT POWERS AGFTEt,1[Nf
TilE BIG INDtTr::~JO[NT CiTIES EXCESS I'C,~L JOINT POW[F,S ;\UTHORilY
This AgreelTli.'nt IS executed by and Cicnong those public agencies, duly orgeJnlzcd
and eXlstlr,g, which are parties signatory to this .A,ljleemenl Ail such p',hl,c agerIC,I"s,
hereinafter called Members, shall be listed in AppendIX A, which shail be aitiJched
hereto and made a part hereuf
RECITALS
WHEREAS, Articles 1 through 4, Chapter 5, DIVision 7, Title 1 of the California
Government Code (commencing with Section 6500 et seq) (hereinafter the 'joint
Powers Law") permits two or more public agencies by agreement to JOintly exercise
powers common to the contracting parties, and
WHEREAS, a Joint powers authority was formed pursuant tu the Joint Powers
Law by the execution of the Members of that certain JOint Powers Agreement Creatll1g
the Big Independent Cilles Excess Pool JOint Powers Authority (the "Orlgll1al
Agreement"), and
WHEREAS, the Membel's deSire to amend and restate the Original Agreement tu
continue to Join together for the purpose of sharing risk, JOintly purchasing liability
Irlsurance and other cO'verages and related programs that eXist, or to be determined Irl
the future.
NOW, THERE:FORE, the piHtics agree as follows
ARTiCLE 1
DEFII~ITIONS
"Authority" shall mean the Big Independent Cities Excess Pool Joint F'owers AuthOrity'
created by the Original Agleelllent alld continued by thiS f\greernent
"Board of Directors" or "Board" shall rnean the gov8rning body of the .Authority.
"Coverage(s)" means the liability coverage to be provided under a Memorandum of
Liability Coverage, and any other areas of coverage including but not limited to,
property, workers compensation, etc, as deterrnlned and approved by the Board
"Executive CO/llmittee" shall rnean the Executive Comnllttee of the Board of [)Ireci(lrs of
the AuthOrity.
"Fiscal Year" shall mean that period of twelve months which is established by the []oard
of Directors or tile Oy!aws as the fiscal year of the I\uthorlty
"GovsPlr~lent Code" shaii rnea'l t:.,e Califorllia Guve,nrnent Code, as It nI,::;/ be
CirTl(:fided from tin-Ie to tl!lIC
'Insurance" means commercial primary or excess Insurance or reinsul'ance,
"Member(s)" means any public agency as the term "public agency" IS def!fled by Section
6500 of the Joint Powers Law, which Includes, but IS not limited to, any federal, state,
county, City, public corpor3t1on publiC district of this state or another state, or any jOint
powers authonty formed pursuant to the Joint Powers Law by any of these agellcles
which has ex',cuted this Agreement and has become <J member of the AutllOnty,
"Risk Management Program(s)" means those progr3ms of nsk sharing, Insurance, and
nsk management services created by Authority to prOVide Coverage to each Member
ARTICLE 2
PURF'OSES
This Agreement is entered Into by the Members to amend and restate the Onginal
Agreement in order that they may Jointly continue to develop and fund Covel age
including but not limited to such programs as risk sharing, excess insurance, tho
purchase of reinsurance, and the provision of necessary administrative services Such
administrative selvices may include, but shall not be limited to, nsk management
consulting, loss prevention and control, centralized loss reporting, actuanal cOllsultlng,
claims adJusting, and legal defense services
All such purposes shall be accomplished through a )olnt exercise of powers by such
publiC agencies, pursuant to thiS Agreement, to be administered by a separate legal
entity, tile Big Independent Cities Excess Pool Joint Powers Authority,
Upon execution of thiS Agreement by two-thirds (2/Jrds) of the Members, the Original
Agreemellt shailno longer be in fOlce ana effect.
ARTICLE 3
PARTIES TO AGREEMENT
Each Member, as a party to this Agreement, certifies that it intends to and does contract
With all other Members as parties to thiS Agreement and with sllch olher pub!lc agenCies
as later may be added as parties to thiS Agreement
ARTICLE 4
TERM
This Agreement shall become effective when executed and returned to the Authority by
each Member The AuthOrity shall promptly notify all Members in writing of slJch
effective date This Agreement shall continue in effect until terminated as provided
herein; provided that the termination of this Agreement With respect to an indiVidual
1.-",,[ P'\\~'i." .'\'''''''11\",,1
"
Member, upon Its withdrawal or expulsion from n1,'rnbership in the Authority, shall not
operate to terminate thiS Agreemept with respect to tho remaining /vlernbers; <il-,d
provided further that thiS Agreement shall contillue In effoct so long as any obllgCltlOilS
01 the Authority are 0utstcwdlf1g.
ARTICLE 5
THI:C AUTHOHtTY
Pursuant to the Joint Pmvers Law, there is hereby created and continued a public entity
separate and apart from each party hereto, to be known as the "Big Independent Cities
Excess Pool JOint Powers Authority," with such powers as are hereinafter set rorth.
I\RTICLE 6
POWERS OF THE AUTHOF~ITY
(a) Powers The Authority shall have all of the powers common to its Members and
all additional powers set forth in the Joint Powers Law and other statutes applicable to a
Joint powers authonty created hereby, and IS hereby authorized to do all acts necessary
for the exerCise of said powels. Such powers Include, but are not IIITIlted to, the
following
(1) To make and el'rlel into COlltracts.
(2) To incur debts, liabilities, and obligatiOns and to e"cumber leal 01 personal
ploperty
(3) To acquire, hold or dispose of real or personal property, contributions and
donations of real or personal property, funds, services, and other forms of assistance
from persons, firms, corporations, and government entitles
(4) 10 sue and be sued in lis own name. and to settle any claim against It
(5) To receive and use contributions and advances from Members as
prOVided in Government Code Section G504, including contributions or advances of
personnel, equipment or property
(6) To invest any money in its treasUlY that is not required fur its immediate
necessities, pursuant to Government Code Section 6509.5.
(7) To employ agents and employees
(8) To receive, collect and disburse moneys.
(9) To develop and implement Risk M;:JIlagement Programs, including but not
limited to the purchase of exce"s IIlsurallce and relllsurance, to 1'3Y claims under
Coverages plovided by HIE? Autllonty
10m! p"',.,'r<; "\I'lcJ'f11Uii
o
(10) To Lnar, ~e ,n occordailce with applicabie laws, by means of the rSSU:II1C8
of bonds or otller instruments of Indebtedness, seif-Insurance reserve funds necessary
or convenrent for the Implementation of thiS Agreement
(11) To exercise otller reasonable and necessary power:, ,;1 fi.il1herance or
support of any purpose of the Authority or power granted by the Jomt Powers Law, thiS
Agreement or the Bylaws of the ("uthority
(b) Re~l!:.Lc.lions on Powers f'ursuant 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 Oxnard is restricted in its exercise of similar powers,
provided that, if the, City of Oxnard shall cease to be a Member, then the Authority shall
be restricted in the exercise of its power In the same manner as the City of Santa I\na
ARTICLE 7
GOARD OF DIRECTORS
(a) Composition of Board The Authority shall be governed by the floard of
Directors, which shall be composed of one director representing each Member,
appointed by the Member's City Council or Governing Board and serving at the ploasule
of such City Councilor Governing Board The City Councilor Governing Board of each
Member shall also appoint an alternate director who shall have the authority to attend,
participate in and vote at any meeting of the Board when the director IS absent A
director or alternate director shall be a member of the City CounCil of the City or
Governing Board of tile publiC entity which appoints such director or alternate director,
or an offiCial or staff person of the Member which such director or alternate director
represents. Any vacancy in a director or alternate director pOSition shall be frlled by the
appointing Member's City Councilor Governing Board, subject to the provlsl011S of tillS
Article. Immediately upon admission of a new Member pursuant to Article 16, such
Member shall be entitled and required to appolflt a director and alternate director
(b) IermlnatloO...QL;?,tatus 3S pirecto_, A director and/or alternate director shall be
removed tram the_Board of Directors upon the occurrence of anyone of the following
events
(1) the AuthOrity receives written notice from the appointing Member of the
removal of the director or alternate director, together With a certifred copy of the
resolution of the City Councilor Goverrllng Board of the Member effecting such
removal;
(2) the withdrawal or removal of tile Member from the Authority,
(3) the death or resignation of the director or alternate director,
(4) the AuthOrity's receipt of written notice from the Member that the director
or alternate director is no longer qualified as proVided in subsection (a) of thiS i\rtlcie
(c) C::_CJ.'.:nJl.Cfl~atIDQ. Dlrecters and their alternates a'e Ilot entitied to.
cornpensaLon. The Coard of Directors nlay authOrlZ8 reljrlburS2i'llent ;1 ~~'xpcnses
Incur red by directars or thell alternates
Id) P'YNerS of GaJrd. The Baard af Drrectars shilll :lii\e the foliawrng pawers and
Turlctioi1S..-----
(1) Except as atherwlse pravided in thiS Agreement the Board ,;hall exerCise
all pawers and conduct ail business af the Autharrty, either drrectly or by delegation to
other badies ar persans
(2) The Board shall form an Executive Committee, as pravided In Article 10.
The Executive Cammittee may exerCise all pawers or duties af tile Board except
adaptian af the Autharity's annual budget
(3) The Baard may farm, as pravided in Article 11, such other cammittees as
it deems appropriate to. canduct the bUSiness af the Authanty ar It may delegate such
pawer to. the Executive Cammlttee in the Bylaws or by resalutian of the Baard The
membership of any such other cammlttee may canslst In whale or in part af persons
who are nat members af the Baard: provided that the [3aard and the Executive
Camlnlttee may delegate decisian-maklng pawers and duties anly to a committee
whase membership IS comprised by a majanty af directars or their alternate. Any
cummlttee nat sa constituted may functlan anly In an adVisory capacity
(4) The Board shall elect the officers of the fI.uthonty and sllall appoint or
emplay necessalY staff In accardance With Articles 9 and 12.
(5) The Board silall cause to be prepared, and shall revrew, modify i1S
necessalY, and adopt the annual operating buclget af the Autilallty Aelcptlon of lIil!
budget lTIay nat be delegated
(6) The Board shall receive, review and act upon periodic reports anj audits
of the funds of the Authority, as reqUired under Articles 1 J and 14 of tillS f\greemellt.
(l) Tile Board shall have sucil other pawers and dufles as ale reasonably
ncceSSdl y to carry aui thu PUI puses uf tile f\UtllOllty
AR T1CLE 8
METTINGS OF rHE BOARD OF DIRl:CTORS
(a) . Bs:9l,1lar Meetinr1f The Baard af Directars shall ilold at least three (3) regular
meetings each year e Board af [.lirectors shall fix by lesolutlan or III the Bylaws tho
elato upon which, and the hour dnd place at WhiCh, ea,;h regulc:r meeting IS to be h :;Id
(b) Ralph M. Brown Act, Each meeting of the Board of Directors,
including without limltatran a regular, adjourned regular, and special meetings shall be
ca!!ed, na!!ced, held, ~nd conducted in 3ccordJilC8 with t1lC Ra:ph ~\.t D,o";\/~~ /\ct,
Sectron 54950 et seq. of the Government Code.
(c) Minutes The Authorrty shall have minutes of each regular, adJourrled
regular, clnJ special meetings kr'pt by the Secretary /\s soon as practicable after e:'ch
IOil1! !".'INC''; .:\~r'_";n:'.:I'1
,
r~leG:!ir"g, the Secretar,' :::.i;aif fOi'\.v~rd to Each Board rneniber a copy of tI":e irlnutes (If
SLC:) i :eetlllg
(d) Quorum 1\ lllilJorlty of the Illembers of the Board IS a quorum for the
transaction of business However, less tllan " quorum may adjourn from time tel time
10. vot., of the majorlt, of a quorum at a meetillg IS suffiCIent to liJke act,011 lil11ess
otherwise provided ill tile Bylaws
(e)
yohnq
Edeh member of the IJoard shall have OnE.: vote.
ARTICLE 9
OFFICERS
The Board shall elect a President and Vice President from among ItS members at Its last
meeting of each Fiscal Year. Each officer shall assume the duties of his office UpOIl
election. If either the President or Vice President ceases to be a member of the Board,
the resultlllg vacancy shall be filled at the next regular meeting of the Board held after
the vacancy occurs or at a speCial meeting of the Board called to fill such vacancy In
the absence or inability of the President to act, the VIce President shall act as President
The President shall preside at and conduct all meetings of the Board The Board may
appoint such other officers as it conSiders necessary and as prOVided in the Elylaws.
ARTICLE 10
EXECUTIVE COMMITTEE
The Board shall establish an Executive Committee of the Board which shall consist
solely of members selected from the membership of the Board. The composition and
the terms of office of the members of the Executive Committee shall be prOVided In the
Bylaws of the Authority The Executive Committee shall conduct the business of the
Authonty between meetings of (he Board, exercising all those powers as prOVided for In
section (d)(2) of Article 7, or as otherwise delegated to it by the Board.
ARTICLE 11
COMMITTEES
The Board may establish committees as It deems appropriate to conduct the bUSiness
of the Authority or It may, in the Bylaws or by resolution, delegate such power (0 the
President Members of committees shall be appointed by the Board or the PreSident,
as the case may be, Each committee shall have those duties as determined by the
Board or the President, as the case may be, or as otherwise set forth in the Bylaws
Each Committee shal! meet on the ca!l of its chairpers2n, and sha!l report to the
Executive Committee and the Board as directed by the BO<:lrd or the Executi'Jc
Ccmmitt2E:, :is !he CJSC ril:~)' C9.
1.;1111 !:" \rf~, Ac'p'""" '"
(i
:..RT1CU:: 12
SHIH'
(3) Principal SJ.91f Tlie following staff r"embers sl,al: be appointed by c;nG serve
at the pieasure of the Board of Directors
(1) General Manaqer/_;:;ecrE?tar.y The General Mcmager/Secrctary shall administer
the business and activities of the Authority, subject to the general supervision and poliCY
direction of the Board and the Executive Committee, shall be responSible for all
mrnutes, notices and records of the Authorrty; and shall perform such other duties as
are assigned by the Board and Executive Committee
(2) Treasurer The Treasurer shall be appointed as provided in the Bylaws
and pursuant to Government Code Section 6505.5 or Section 65056, as these sections
may be amended from time to time The duties of the Treasurer are set forth In Article
13 of thiS Agreement
(3) Controller The Controller shall be appointed as provided In the r3ylaws
and pursuant to Government Code Section 6505.5 or Section 65056, as these sections
may be amended from time to time The duties of the Controller cHe set forth in Article
14 of this Agreement
(b) Other Staff The Board, the Executive Committee or the General
Manager/Secretary shall prOVide for the appointment of such other staff as may be
necessary for the administration of the Authority
(c) Compensation The General Manager/Secretary, Treasurer, the Controller
and any other members of the staff or employees of the AuthOrity shall be compensated
In such manner as shall be apPloved by the Board oS permitted by applicable law
ARTICLE 13
RESPONSIOILlTIES FOR FUNDS AND PROPERTY
(a) Qutles of Treasurer The Tleasurer shall perform all duties as required under the
Jomt Powers Law including.
(1) Receive and receipt for all money of the Authority and place It in the
treasury of the treasurer so designated to the credit of the Authority.
(2) Be responsible, upon his or her official bond, for the sofekeeping and
disbursement of all Authority money so held by him or her
(3) Pay, when due, out of money of the Authority held by him or her, oil sums
payable on outstanding bonds and coupons of the Autholity.
(J) Pay any other sums due from the Authority from Authority r~,oney, or any
portion tnereof, only uf.-on warrants of !h" public officer performing tile functions of
Controller who has been designated pursuilnt to the Bylaws.
(5) Verify and report in writing on the frrst day of July, October, January and
,II,pril of each year to the AulllOrlty and to each Member to thiS Agreement, the amount
of monf;y he or she holds for the Authority, the amount of receipts Slr,ce his or her last
report, and the alTiount paid out since his or her last report
(b) Authoritv Proper:!'L Pursuant to Government Code Sectron 65C5 1, the General
Manager/Secretary, the Treasurer, and such other persons as the Board may deslgnale
shall have charge of, handie, and have access to the property of the Authority.
ARTICLE 14
ACCOUNTS AND RECORDS
(a) Annual 8udg~. The Authority shall annually adopt an operating budget
pursuant to Article 7(d)(5) of this Agreement
(b) Funds and Account~ The Controller of the Authonty shall establish and
lTiaintain such funds and accounts as may be required by good accountrng practices
and by the Board Books and records of the Authority in the hands of the Controller
shall be open to Inspection by authorized representatives of the M8mbers at all
reasonable times The Authority shall adhere to a standard of strict accountability of all
funds as set forih in the JOint Powels Law
(c) Controller's ReQQl:!. The Controller, within one hundred twenty (120) days after
trle close of each Fiscal Year, shall give or cause to be given a complete written report
of all financial activities of such FI~;cal Year to the Board and to each Mt;mller
(d) Annual Audi! The I\uthority shall proVide for a certified, annual audit of the
accounts and records of the Authority which audit shall conform to generally accepted
auditing standards When such an audit of the accounts and records is made by a
Certified Public Accountant, such report shall be filed as a publiC record with each of the
Members and with the county auditor In which each of the Members IS located Such
report shall be filed Within six (6) months of the end of the Fiscal Year under
examination Costs of such audit shall be considered a general expense of the
AuthOrity and included in the term "administrative costs,"
ARTICLE 15
MEMBER RESPONSIBILITIES
E 3ch ~,JclTiber' shall have the fol!owing respolisil1llities
(a) To appoint its director and alternate director to, or remove its director and
alternate director from the Board as set forth in Alticle 7.
I n II' I !', ,v. t: I'; ..\ 1.'fl;(' r}1': ~ll
R
b)
( ,
To consider proposed arner;di'rlents to thIs I\greerner:l as set fOiih in /\rticic 24
(c) Tc make contnbutions ,n the form of memoeishlp premiums, assessment:" fees
and fees, if any, in accordance with the Byla\\ls and as determllled by the Board, for the
purpose of defraYing the costs of providing the annual LJeneflts accruing directly to each
party from this Agreement
(d) To provide to the Authonty such other infoi'l113tlon or assistance as may be
necessary for the Authority to c3rry out the Risk Management Programs as deterrnmed
by the Board
ARTICLE 16
NEW MEMBERS
W,tll the approval of two-thirds (2/3rds) of all current members of the l10ard, and
compliance with all requirements of the Bylaws of the Authority and of the JOint Powers
Law, any qualified public agency may become a party to this Agreement The date that
the applYing public agency will become a Member shall be determined by tile Board
ARTICLE 17
DISSOLUflON AND DISTRIBUTION OF I^lSSETS
This Agreement may be terminated and the Authonty dissolved by the written consent
of two-thirds (2/3rds) of all Members; provided however, that this Agreement and the
Authonty shall continue to eXist for the purpose of disposing of all claims, the distnbutlon
of assets, and any other functions necessary to conclude the affairs of the Authollty as
prOVided in the Bylaws of the Authority.
ARTICLE 18
WITHURAWAL OF MEMBER
A Member may withdraw from membership in the Authority III accordance with tile
procedures and the condltlclflS as provided III the Bylaws of the Authority
ARTICLE 19
EXPULSION OF MEMBER
A Member may be expelled from membership ill the Authority by a two-thirds (2/3rds)
vote of all members of the Board in accordance With the procedures and the conditions
as provided III the Byl2w5 of the fI.uthority
Co
/l,RTICLE 20
OBL:CATIONS OF AUTHORITY
The debts, liabilities and obligations of the Authonty shall not be the debts, liabilities anu
obligations of each Member Any Member may separately COlltract or assume
responslbiilty for speclilc debts, Ilabll:tles, or obligations of the Authority
Pursuant to Sectran 8952 of the Government Code, the rvlembers may be Jointly and
severally liable for any liability which IS Imposed by any law for InpJrY caused by a
negligent or wrongful act or omission occurrrng In tbe performance of this Agreement III
the event that such liability arises out of a negligent or wrongful act or omission wi:h
respect to a Risk Management Program, the Members hereby provide, pursuant to
Section 8956 of the Government Code, that such liability shall be borne by the
Members participating in such Risk Management Program in the same proportion as
administrative expenses of the Risk Management Program are allocated among such
partiCipating Members at the time the liability is determined. In the event a Member IS
held liable upon any Judgment for damages caused by such an act or omission and
makes payment in excess of ItS proponlonal share, as determined In the preceding
sentence, such Member' IS entitled contribution from e<lch of the Members which have
not paid their proportional share
ARTiCLE 21
LIABILITY OF BOi\f~D OF DIRECTORS, OFFICERS AND COMMI rnT MEMBEf~S
The members of the Board of Directors, officers and committee members of thF~
Authority shall use ordinary care and reGlsonable diligence in the exercise of their
powers and in the performance of their duties pursuant to this Agreement. They shall
not be liable for any mistake of Judgment or any other action made, taken or omitted by
them in good faith, nor for any action taken or ollllited by any il,~ent, employee or
independent contractor selected with reasonable care, nor for loss incurred thre-'IC;']
Investment of Autt~clrlty funds, or failure to IIlvest
No director, officer or committee member shall be responsible for any action taken or
omitted by any other director, officer or committee member. No director, officer or
commiHee member shall be required to give a bond or other security to guarantee ttle
faithful performance of his or her duties pursuant to thiS Agreement.
ARTICLE 22
BYLAWS
Tile Board shall adopt Bylaws conSistent with this Agleement which Shilll provide for th0
administration and management of the Authority
! I" oj Ii' (\' 'rr" ,/I, i~ Ill.: ,T I (;:11
In
J\f~TiCL[ 23
r~01ICES
The Authority sllall addrGss nCltrces, bril;ngs and otller communications to a iVlernber 3S
directed by sllel, Member Each Member shall provide tI Ie t,uthority v,ltll the address to
Wtllch communications are to be sent Members shall address notices and ottier
cornmunlcatrons to the i\uthorlty, at the office address of tile Authority as set forth In the
13ylaws.
ARTICLE 24
Afv1ENDMENT
This Agreement may be amended at any time by vote of two-thirds (2/:li'ds) of tile
Members, acting through their City Councils or Governing Boards, and compliance 'Nlth
any requirements of the Joint Powers Law Any amendment of thiS Agreement shall
become effective upon receipt by the Authorrty of notice of the approvill of such
amendment by the City Councils or Governing Boards of two thirds (2/3rds) of tile
Members and satisfaction of any requirements of the JOint Powers Law
ARTICLE 25
SEVEHAGILlTY
Should 3ny portion, term, condition, or provision of thiS Agreement be decided by a
coul1 of competent Jurisdiction to be i1tegal or in conflict With any law of the State of
Callforr-,ia, or be othelVolise rendered unenforceable or ineffectual, the vallcJity of Ihe
remaining portions, terms, conditions, and provIsions shall not be affected thereby
AfnlCLE 26
PROHIBITION AGAI~~ST ASSIGNMENT
No Member may assign any right, c13im or interest it mav have under this Agleeme'lt,
ilnd no creditor, assignee or third party beneficiary of any Member shall have any ri(jht,
claim, or title to any pal1, sllare, interest, fund or asset of the Authonty.
ArUICLE 27
AGREEME.NT COMPLETE
ThiS Agreement constitutes the full and complete agreement of the parties. There are
no oral understandings or agreements not set forth In writing herein.
AI~TICLE 28
FILING OF NO nCE C'F AM[~J[)MEI'H
Tile Geneml Manager/Secret"iry of the i'\uthonty shall f:le a notice of this Aqreemcnt
Within 30 days of ItS ellective dde with the office 01 1I1e Califa, Ill;] Secretary 01 State, as
required iJY Government Cede Sectio.'l C50J 5 Upon di IY change in rnerr1~)ership, n-ie
Gellera! Managel/Secretary shal! lile a notice of such change of ITwmbershlp wltl1"1 1 oJ
days of it~; effective date with the Secretary of State and with the county clerk of the
county In whic.h oaell Member IS located, as required by Government Code Section
53051
IN 'NIT~~ESS WHEREOF, the urldE:lsigned party lIerolo :iilS executed this Jom! fJovicrs
Ag:eernent on the elated indicated below
DArE
,.,\TTEST
CITY CLEHK
GY.
APPROVED AS TO FORfvl
CITY ATTORNEY
/1
/ I
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BY- -Jl[4~-~~!/~~~-~~"~""'-
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,
/
,
/
/
/
CITY OF
OY
ITS
,t'ME:N[)[D CYIAv'JS
01" THE
BIG IrWEPENDErH CITIES EXCESS fJGOl JOI~H POvVEi(S AUTHORITY
ARTICLE I
Dr.:FINITIONS
The definitions of terms used in these By!aws shall be the same as those contained In the JOint
Powers Agreement ("JPA Agreement") creating the Big Independent Cities Excess Pool JOi01t
Powers Authority, hereinafter called BICEP, unless otherwise expressly prOVided herein
1.1 "Board" means members of the Board of Directors of OICEP, provided that Members that
do not participate in a given risk sharing layer(s) shall not be entitled to vote on any action with
respect to those risk sharing layer(s) and any references III these Bylaws to a majority or speCified
percentage of the Board shall be deemed to mean a majority of the affected Members of the
Board
12 "Charter Member" means the Member cities that formed BICEP 11'I September 1988 WlllCll
are Huntington Beach, Oxnard, Pomona, Siln Bernardino and Santa Ana
1 3 "Coverage" means the liability coverage provided in the Memorandum attached as t'Xhlblt
A hereto and IIlcorporated herein by reference, and any other areas of coverage including but not
limited to, property, workers compensatiorl, etc, as determined and approved by the Boc:rd
14 "Coverage Period" means each year co-extensive with the Fiscal Year for which a Member
pays premiulTls for Coverage, unless and as amended by the Soard
1.5 "Fiscal Year" means from July 1 In each calendar year to June 30 of the next calendeH i'ear
unless later amended by the Board
1 6 "Insurance" means commerCial primary or excess insurance or reinsurance
1.7 "Member" means any public agency as the term "public agency" is defrned by Section 6500
of the Joint Powers Law, which includes, but is not limited to, any federClI, state, county, City,
public corporation, publiC district of this state or another state, or any Joint powers authOrity formed
pursuant to the Joint Powers Law by any of these agencies which has executed this Agreement
and has become a member of the Authority.
1.8 "Memorandum" means the BICEP Memorandum of Liability Coverage set forth in Exhibit A
hereto and Incorporated her'coin by referRnce.
Byl~ws
05~31 06
1.9 "Risk k';anage~lf.;nt FJrograr,1" means U10S3 progran-ls c.f risk sharing, lilsur3nce, ;1:)] I-isl~
managt',;llen\ services created by GiCEP tu provide Coverage to each Member
ARTICLE II
OF'[f\;\ 1IONI\L ITEMS AND GOV[Ri'-JANCE
2 1 Term The Term of these Amended Bylaws shal! com:r.ence on the dat8 of approvdl
by the Board as provided in Section 2.3 and shall conllnue until later amended by t:le
Bcard or dissolution of BICEY as provided herein
22 Amendment of Bylaws, These Bylaws may be further arr,ended at any lime by a two-
thirds (2/3rds) vote of all members of the Board FollOWing adoption of amendments. the
GenerClI Manager shall prepare and distribute a revIsion of the Bylaws to all Members
2 3 Effecti'Je Date These Bylaws shall go into effect immediately upon adoption by the
Board as prOVided herem
2 4 Election of Officers The Board shall elect the Presrdent and the Vice f)i(;siden( !rom
among the members of the Board For each Fiscal Year, the officers shall be elected in the
follOWing manner
24 1 At the last regular meeting of each Fiscal Year, the Board shall elect officers ;1:;
required by the JPA l'Igreement and these Bylaws for the upcoming Fiscal Year All
terms of office shall be for one year. The officers shall begin serving tel ms upon tile
beginning of the fiscal year Immedrately followillg the election
242 Each Board membcr may place themself or another Board member in nom:n~JiIOII fur
each office
2.4 3 Each Board member shall cast one vole for the candidate of his/llcr clloice r'A GJd1
office.
244 The Board may remove an officer at any time A vacancy in any office. due to death,
resignation. removal, disqualification, or any other cause, shall be filled by elect 1011 of
the Board
2.5 Duties of Officers
2 51 Duties of the President
The President shall preside at and conduct all meetings of the Board and perform all duties
as provided in these Bylaws 01 deiegated by the Board The immedlClte P~st Prcs~::jcnt Shill!
,
'By:,~.^,s
US 31-C6
2
serve as 2n ex officio me:Tlber of the Ei:ecutlve COfTimittee r...ji 3 tcrnl of Crlc: l1) YEar, 3ncJ as locg
as lie or she remains a member of tile Board
2 52 Duties of Vice Prce.ldent
In the absence of the President, the Vice President shall perform ail dulies assigned to Iile
President by these Bylaws or by the Board
2 6 !l,ppointment and Duties of Treasurer
The Board shall appomt the Treasurer as provided In Section 6505 5 or Sectron 65056 of the
California Government Code The duties of the Treasurer shall be those speCified In JPA
Agreement, in Section 6505 5 or 65056 of the California Government Code, and In accordance
With the laws applicable to any out-of-state Member The Treasurer shall monitor and oversee the
depOSits and investments of BICEP's funds by the General Manager and perform other duties 3S
specified by the Goard.
2.7 Appolntmellt and Duties of Controller
The Board shall appoint the COlltroller as provided In Section 6505 5 or Section 650:' C) of the
California Government Code The duties of the Controller shall be those specified in the Jr~/\
Agreement, In Section 6505 5 or Section 6505.6 of the California Government Code, alld :n
accordance With the laws applrcable to any out-of state Men,ber
2 S AppOintment and Duties of General Manager
Bya maJorrty vote of ail mernbers, the Board shall apPOint a Gcncral Manager to conduct the day-
to-day operations of BICEP 1he General Manager shall perform those duties 3S deieqated and
authorized by the Board, includlllg but not ilrrllted to, keeping illlnutes of the Goard rn8ctln0S, eJlld
keeping and maintaining all of the records of BICEP
29 Establishment of Commrttees
291 Executive Committee There shall be an Executive COlTlmittee of the Board (,f
Directors which shall consist of not less than four (4) members, exclUSive of allY currell!
immediate Past President serving as an Ex Officio Executive Committee Mernber Two of the
members of the Executive Committee shall be the Presrdent and the Vice President of the I:loard
The other members of fhe Executive Committee shall be elected by the Board The President, or
the \lIce PreSident in his/her absence, shall serve as the Chairperson of [he Lxewtive COlTimitlcrc
292 Subject to approval of the Bomd. the President shall apPuill1 any other cormnittees
and deterrnlne the committees' structure, charge, size and membership Committees may be
BV!::j'IVS
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3
established to consider any matt2r \\;:1hin tl'e jUflScJlct!Drl of 8ICErJ. Ccrllnllttecs ;,/:311 operate
according to the policies adcpted by tile B02,rd afld shc'i1 sublnlt tllerr rcpolis a/!d
lecommendations to the BO:Jrd The chairpei"SOn of a CCn1iililtce ~"hafll~e iJ member of the Boc;rd
ur an alternate cJllector
210 Board Meetings
2 10 1 Regula, Meetings"
A" TlmQ_Held Unless otherwise changed by a majority vote of the
Board, regular meetings shall be held as required to conduct the business of B!CEP,
not less than three (3) times in each Fiscal Year
B" BU,;lness to b~ Trall,sacted
transact any bUSiness Within Its pOVlers,
affairs of BICEP"
At any meeting, the Bo,ud m2Y
and receive reports of the operations and
C tJ_Q.l![:e \lVlltten notice ("Notice") of each regular meedng of the
Board shall be delivered to each director and/or alternate director at least fourken
(14) days In advance of the meeting" Delivery of the Notice may be accompli';iled In
electronic form The Notice shall Include a proposed agenda and shall speCify
(r) The piace, date and hour of the meeting
(il) Those matters which are IntendC'!d to be presented fo; action by
the 80ard
D. 1Il.cJusiorl~_ofJ!erns in F,el.1.llI'Jr Meetlllq Ag~llda. Within three (3)
calendar days of receipt of the Notice which 1I1c!udes the proposed agenda, any
directol or alternate director may cause an Item to be included in the agenda lor i1w
upcoming Board meeting by delivering to the PreSident or the General Manager a
written request, which may be In eiectronlc form, to Include suc.h Itern in the agenda.
2.102 Special Meetings
A special meeting of the Board may be called at any til"ne by the PreSident or by a m;->jcllty
of the directors subject to the requirements for 24-hour written notice to tile directors Clnd/ol
alternate directors and to requesting representatives of the media The notice at a speCial
meeting shall specify the time and place of the meeting and the bUSiness to be transacted
No other business shall be considered at the meeting. A member of the Board rnay 'Naive
notice as provided In Section 54956 of the Government Code and In accordance witll the
laws applicable to any out-of~state Member. Notice of tile calling of clilY specidl iTleetll1'.1
Byl;JW5
O~-J1-06
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shall be posted as pro'...'lced in sd:d Section 5-195'3 and in (Jc,.....;JrCOflCc w!~h 'he i,J\Vs
applicable to at-;y out of-stale ~\i12:~'liJl::r
2 103 (I,djourned r,.1eetln~lS
The Board may' adjourn any regular or special meeting to a time and piau, specified In tile
order of adjournment, whether or not a quorum has been established. If a ql:crulll IS not
establi,;hed, no business other than adjo'Jrnrnent may be transacted /\ copy of the Older
for adjournment shall be posted
2.11 Alternate Director
The alternate director appornted by a ~,,1ember as its alternate representative on the 130al0 may
attend and partiCipate In any meeting of the Board and, in the absence of the director, may vote In
anI' meetrng of the Board as the representative of the Melllbcer
2 12 Quorum and Votlllg F~equirements
A majority of the Members shall constitute a quorum for the transaction of business All IJctlon5 of
tile Board shall require the affirmative votes of a majority of the Membols presellt at i.l meelill~l
duly held at which a quorum is present unless otherNise expressly pruvlded IIel8111 Each
Member shall be entitled to cast only one vote
2 13 Brown Act CompliGl/lce
Notwithstanding anythlllg herein to the contrGlry, all meetings shall be !leld in stnct compliance
with the Ralph M Brown Act (California C;overnment Code Section 54950 et seq.), as it may be
amellded from timo to t1r;le, and III accordance With the laws applicable to any oul-of-state
Member
214 Robert's Rules 01 Older
All meetings of the Board, its Committees or other bodies of BICEP shall be conduclcd In
accordance with Rober1's Rules of Order, provided that III the event of a conflict, these E3ylaws '-'1
applicable stale liJW sha!1 supersede and control
2 15 Authority to Sign Documents
The Board may authorize any officer, staff member, or agent of BICEP to execute any contract in
the name of and on behalf of BICEP, and such authonzation may be general or speCifiC In nilture
Unless so authorized, no officer, staff member or agent shall have any pO\Ner to bind F3ICi~P bV
contract
\
[1yl<1WS
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2 ~() Offices
BICEP's principal office for the transaction of business IS located at 1100 S ilowcr St,eel, Sin:"
2100, Los Angeles California 90015 The f:ioard mal' chilnge the loc3tlon rA the prlllClpal oilce
from time to tll1',e The Board may fOstobiish one or rnore subordinate offices 31 ;:m)' p!;:lC8 :JI places
where BICEP IS qualified to do busine,s
A8TICLE. III
FINANCE
3.1 Budget
Prior to the last Board meeting In a Fiscal Year, the General Manager shall submit to the Board a
proposed general budget for the next Fiscal Year. That budget shall include revenues and
expenses with beginning balances. Revenues are to be broken down by operating revenues and
Interest Income. Expenses are to be broken down by operatll1g expenses,
professional/contractual services p!'JS pool coverage and claim expense The budget shall
provide information for the three prior Fiscal Years, the budget and projected budget for tlie
current Fiscal Year, and the proposed budget for the upcoming Fiscal Year. The Goard sh;:]11
review and adopt the budget no later than at the last meeting of the Board In each Fiscal Ycar
3 2 Delegation.
The General Manager shall manage all expenditures, subject to control of the Board I he
General Manager and Treasurer shall have power to transfer funds Within the tot,iI detailed budge I
to meet unanticipated needs or changed situations Such action shall be reported io the l.3o;:ml at
their next rneeling.
ARTICLE IV
NEW MEMBER REQUIREMEr~TS
4 1 Conditions to providing Coverage to a New Member
BICEP may provide Coverage to any neN Member(s) which is not currently a Membw Ul'dd
tllese Bylaws, subject to the fol!owlng conditions
4 1.1 The new Member shall be a public agency as defined in Section 6500 of the
California Government Code.
4.12 The public agency shall have a full-time risk management employee, or subjec' 10
the urlanirnous app:'o'J;J1 cf the BO<lrd, shall have either (I) <l ri5t; ma,;aqemcr:t
if:\yIOl\'VS
O~131-0G
b
professlon2-i or (i:) oillenNlsc nl~Jst be ab:s t::: dc;!1lonsl~aie 3 sound r1S;'~ 1113naDc;ilcnt
plograrn
4 1 3 The publiC ag811cy "b,c;il have an a:tlve loss control progr::ml
4.1 4 A new Member's pClrtlcip<Jlion in a coverage program of BICEP shall be subject to an
actuarial study of loss experience to compale with current Members to see If the
new Member's palilclpatllJn would adversely affect the actuarial soundness of a
BICEP program
4.1 5 The recommendation of BICEP's insurilllce broker
4 16 Submission of reasonably required information including but not limited to, audited
financial statements, underwfitlflg data, clalllls and loss reports.
4 2 Acceptance of New Member
Acceptance of a new Member shall be approved by a vote of t\Vo-t~lirds (2/3rds) of all current
Members of the Board.
4.3 Condition to Acceptance
Acceptance of a new Member shall be subject to the approval and execution of the .Joint Powers
Agreement, as It may be amended from time to time, by such Member's governing body and
agreement to be bDund by these Bylavis.
ARTICLE V
COVERAGE ACCEPTANCE
51 BICL.P ~1ereby agrees to provide Ihe Coverage to each MelTlber, and each Member Irereb,!
agrees to accept the Coverag0', In accordance with these Bylaws and upon the terms alld
conditions set forth in the Memorandum and/or Insurance purchased for Members In aGcordanc0
with each Risk Management Program In which a Member [l:Jrticipates
52 The Board shall annually determine each type of I'\isk Managemellt Program which BICEP
may provide for Cov'2rage, or for a portion of Coverage, to the Members Each SUdl 1~lsl\
Management Program shall proVIde for appropriate levels of self-insured retention, risk shailrl~l
and the purchase of Insurance from a commercial Insurer or reinsurer, as determined and
approved by tile Board. The Board may determine to suspend the Memorandum 3nd accept the
policy of Insurance as the basis for liability coverage by the approval of a "reverse follovilng form"
5 3 Coverage provided to eac.h Member IS e:(pressly conditioned on that Member's payment <Ii
applicable premiums related to the Hisk Management Program In which the Member partiCipates
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ARTICl [ VI
DiSSOLUT ION iJF 8ICE:F'
6 1 GIC[P shall continue untt! dissolution as determined by a two.thirds (2/Jrds) vote of ['Ie
entire Board The JPA Agreement and these Bylaws shall continue In force and effect for
purposes of disposing of all claims, payment of all expenses related to such dissolution, inclulilnq
but not limited to, Insurance company payroll audits, claims adjustment costs, financial aucJdlllg
expenses, accounling costs, Investment services expenses. required official dissolulion noticb to
vallous parties, attorney costs and any other related necessary expenses, and the dlstllbutlon of
remaining assets of BICEP,
6 2 The distribution of remaining assets of BICEP upon dissolution shall be In accordance With
the terms and conditions for distribution as provided in tile Risk Mal13gemcnt Program In Wlilch a
Member participates,
6 3 The Goard IS vested with all powers of BICEP for the purpose of concluding and dissolving
the busllless affairs of BICEP
ARTICLE VII
WITHDRAWAL BY MEMBER
7 'I COlldUI~fls_lQl'ermittinq Withdrawal of aj',iembe.IJrocn Cover~ On and after .July 1,
2005, BICEP shall permit a Member to wdhdraw from Coverage subject to the follO\vlIlll
conditions,
71,1 A Member shall not be In default of any of its obllg3tions to pay ,lflY premium as
rrovided herein and pursuant to a !<Isk Management Program
7 1.2 Notice to Withdraw
(a) (\ Charter Member shall provide written notice to BICEP of Its intent to
Withdraw no less than six (6) months preceding the upcoming renewal date of Coverage ^
non,Charter Member may not Withdraw for a period of thirty-six (36) months commenclIlg
from the date of admiSSion to BICEP ("Initial Term"). After the Initial Term, a non-Charter
Member shall prOVide written notice to BICEP of its intent to withdraw no less than SIX (6)
months preceding the upcoming renewal date of Coverage; except, however, a non-
Charter Member may provide such 6-month notice prior to the end of its Inllial Term, which
withdrawal shall t3ke effect on the next Immediate renewal date of Coverage.
(b) Any Member may withdraw from a Risk Management Program which is non-
risk shi'lrIng by providing written notice no less than ninety (90) clays preceding the
upcoming renewal date of such non risk shamlg Coverage.
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7.13 A Member S113;1 hove paid all fees and expenses Incurred by CICEP a~ a result of
such Withdrawal
714 A Member's 'NlthurJwal shall be effective on the first day of a ne'N Coverage PCllod
7 2 The distribution to a Member of assets of BICEP upon Withdrawal shall be II'i a,xGidance
With the terms and conditions for slich distribution as provided in the Risk Managernent r-'rogr<ml
In which a Member pulilclpates
73 A Member that is not participating in any Risk Management Program shall be deemed to
have withdrawn from BICEP
ARTICLE VIII
EXPULSION OF MUv1BER
8 1 Conditions tQ.J2Q.CmlttiDn_.("1<~sloQ.Qf..a MeiI1.ger from Coveraqe
Member from Coverage subject to the followrng conditions
BICU) Illay opel a
8 1.1 A Member shall be in default under these Bylaws, the Memorandum, or a Risk
Management Program and shall have tailed to cure such default In accordance wlll1 the PioviSlons
of Article X, below,
8 12 The Board, by not less than two-thirds (2/3rds) vote of the Members, excludln,l the
Member in default, shall have approved such expulsion and written notice of the final actloll uf
expulSion shall have been given to the Member not less than sixty (60) days precedll1:J tlie
effective date of sllch expulsion,
8 2 In the event that BICEP elects to expel any defaulli;'lg Member, subject to tl1(o conditiOne;
described and In the manner provided in Section 8.1 hereof, the Member nevellhelcss agr(,es 1(1
pay to BICEP all cost, losses or damages howsoever arising or occurring as a result of such
default In no event shall expulsion waive or release SUcll defaulting Member frem Its on~Jolll!j
obligations assumed during ItS years of participation in BICEP pnor to the effective date at
expulsion.
83 The distribution to a Member of assets of BICEP upon expulsion shall be In accoll.Ja'~ce
with the terms and conditions for such distribution as provided In the Risk Management Program
in which a Member participates
,
BylawS
uS 31-(;6
9
ARTICLE IX
INDEMNIFICATIOi~ A"D DISCLAIMER
9 1 lil(t~mnlficatlon Covenailts. Each Member hereby agrees to indemnify and "ave
BICEP and all other Members and their respective offlcels h.armless from and against all CldlIllS,
losses and damages, including legal fees and expenses, arising oul of such Member's breacll or
default in the performance of ,my of its obligations under these Bylaws, the Memor~Jndum, and a
Risk Management Program
92 Disclaimer BICEP MAKES NO WARRANTY OR REPRESE~HATION, EITHfR
EXpr~ESS OR IMPLIED, AS TO THE (IDEQUACY OF THE COVERAGE FOR THE NEEDS 010
ANY OR EACH OF THE MEMBERS.
ARTICLE X
DEF/>.ULTS />.ND REMEDIES
10.1 DefiLults The follOWing shall be an event of default under these Bylaws and the te~rn
"Event of Default" shall mean, whenever It IS used in these Bylaws With respect to a Member, :1I',y
one or more of the follOWing event:3
10 1.1 [Oallure by a Member to pay any premium or various cldju~;ti11en:s c'r
allocations required to be pilld hereunder:
10.12 Failure by a Member to observe and perform any covenan!. condition cr
agreement on Its [Jalt to be observed or performed herein or otherwise wltl) respect hereto,
10 1 3 The filing by the Member of a case of bankruptcy, or the subjection of any
right or interest of the Member under these Bylaws to any execution, galllishment or at!'lchment.
or adjudication of the Member as a bankrupt, or assignment by the Member for the benefit cf
creditors, or the entry by the Member Into an agreement of compOSition With creditors, or the
approval by a court of competent jurisdiction of a petition applicable to tile Member III ary
proceedings instituted under the proviSions of the federal banllruptcy code, as amended, or Llnckr
any similar act which may hereafter be enacted:
10 1 4 Failure to fully comply With the terms and provIsions of C'le Memorandum or <.l
Risk Management Program.
10.2 Notice of Default. BICEP shall give written notice of the Event of Default ("Nolice of
Default") to the Member in default, specifying the Event of Default complained of by BICEP, in the
time periods as provided in Section 10.3 below Failure or delay in giving SUCll notice sholl Ilut
constitute a waiver of any Event of Default, nor shall it change the (Ime of dctault
BylJVV5
OS-3106
1 C
.
103 RICjh.L1.~ure Q~l~~! The 1\1f,mber v..hose aces cn ornsslons to act cons:rhJte ,,11 [vellt
of Default as defined 111 Sectlun 101 shall be en\lLed to cure, correct, or remedy SUC'l Event uf
Default, If (I) such defaulling rJien~bel commences and thereafter diligently purswos the ClIi1ng of
said Event of Default within thlr1y (30) days of receipt of a Notice of Default, as defilled In Section
102, and (il) such defaulting F'arty fully completes such cure, correction or remedy WIU111I thl"l'
(30) days of receipt of said Nolice of Default, or, in the event that the Event of Default is not
curable within said thirty (30) day period), within such additional period as IS reasonably nccessar'Y
to curo said Event of Default: provided that such additional period shall not In any event exceed
rdnety (90) days without the Board's consent In the event Member reasonably Clnd In good faith
contends tflat it Will take more than ninety (90) days to cure the Event of Detault, the defaultln(J
Member and Board shall meet and confer In good faith arid determine wllether additional time I:;
required to cure the Event of Default, and, If so, the Board shall extend the time to cure the Event
of Default Notwithstanding anything to the contrary in this Section, if the Event of Default consi:;ls
of 3 Member's failure to timely discharge ItS mo,",etary obligations to BICEP, then the Member III
default shall cure any sllch default within ten (10) days of receipt of a Notice of Default
104 t'lo 8i'm~Qy_~l<.f:~siv~ Unless otherwise expressly prOVided lil these Bylaws, the
Memorandum, or a Risk Management Program, the nghts and remedies of BICEP ale cUiTlulatl'Je,
and the exercise by BICEP of one or more of such rights or remedies shall not preclude the
exercise by it, at the same or different times, of any other rrghts m remedies fm the sa: ne defaL,:!
or any other default
10 5 6.9.ceemenLto p~Y1'JtOr:D~Ys' Fe",es Q.nd_ Expe.r:!~(;.o"-' In the event any party to these
Bylaws should defaull under any of the provisions hereof and the nondefaulting parties should
employ attorneys or mcur other expenses for the collection of moneys or the enforcement of
performance or observance of any obligation or agreement on the part of the defaultlllg pell ~y
contained herein, the defaulting party agrees that It will on demand pay to the rlondefaulting
parties the reasonable fees of such attorneys and such other expenses so Incurred by til(~
nondefaulting parties awarded to the nondefaulting parties by a court of competerrt )IillSdlctlon
106 NQ-.A9dilion.!3.li:Y.9iv~..r:J.Q.ll2.liecLp.Y..D_ne Wi}iver, No waiver by BICEP of any breach of these
Bylaws or any prOVISions of these Bylaws shall be deemed to constitute a waiver of any preceding
or succeedmg breach of the same or any other provision of these Bylaws Any failures or delays
by BICEP in asserting any of Its rrghts and remedies as to any default shall net operate as a
waiver of any default or of any such rrghts or remedies Delays by BICEP in asserting any of its
rights and remedies shali not deprive BICEP of Its right to institute and maintain any actions or
proceedings \"hICh It may deem necessary to protect, assert or enforce any such rrgtlls or
remedies
l~yli:~W~,
C~:<11-06
11
AFmCLl: XI
i;~-:rL.ICJ~\OL[ :~TJ\TE: L/~.\".J
11 1 The laws of li1e State uf Ca!ifOlllla 51:,,11 gOvern tile Interprctatloll and enforcement of 1I1('::l'
Gylaws If' the ever,t cf a cOllflict be'v/een California laws and ail out-o: s:ate Member's state !,.'IV.
Caitfornia law shall COl1tl0l, except however, notwithstanding any prOVIsion to the contralY, these
Bylaws shall not bee constlued to alter or change any applicable limitations to liability, eg, caps Oil
liability Judgments, more stringent claim reqIJir8ments, or other Immunities, applicable under the
state law of an out-of-state Member to such Member To the extent that another state's l<Jws do
not conflict With California laws as referenced herelll, the other state's laws also apply. The
Members agree that any legal actiolls and proceedln~Js to resolve any dispute under JI',\
Agreement, these Bylaws or any Risk Management Program shall cnly be brought 111 the SupC:llor
Court of the StiJte of California.
ARTICLE XII
COMPANlmJ DOCUMENTS
12 1 All Exhibits referred to in this Agreement are Incorporated herein by such referellce and
made a palt Iwrco!
fJ'l'i3NS
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12
.
I: I C ~.:\ L...~): H '\ t f ~ I () I~ \, \ i) ll:'d (1 F L I \ H! :, r( 't' '- d \' E E,\ C t.:
l'lil~ \1L:-1C)F..-\>.I::U\1 pr<.1\I~!'_51'~-\nkd II:.1\. "!l,ll!l~g ~m"i()l,g [lie \'!~:\lrn::,~~; c.\rlilc nlg ]l1ck]l~J1dl'I11
Cl" L'S F "Cc;.;S 1 J(lO J ':'J Il~ 1 II( "'.','L'i-~' :\ [I l.l1\:! J l:- (" 13 Ie LP '") i'\l[~_~~1;1:111l) G(J\ ;.~r-:11 nt':;l Code see! iOllS ()\)(U~ ;llHJ
CJ'I
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:'1 ~~,.'lhi,:~ldi.llll uf (IlL r\lL~:,;l;l_h.'>] ,1.\llltl!! llr (;h': jllCl1i!Uid, UiCLI' ;ll1d lill' j\.lL!'\'IBLR ;Igrl..:c ,;S
f,.:, 1 i ()\!" ~;.
SFCTlON 1-- COVER\CLS
l3ICFf' \\'111 p.'IY Iho\e Slims nn hclidlf of the COVERED PARTY [01 COVERED tIUE\1A TE NET
U ISS Ihallhc C()\TRLD l'/\IUY bCCU!11CS !eg.'!lly obllgdlc',j In pay dS DAM:\C;ES by fC.'I';OIl of
Ildbllrly Ill1posed by Idw nr JS""lled under a COVUZLD 1l'<[)F\l;.J1 II' CONTRACT bcci1l1se of
IlODILY INJURY, ]>ROI'ERTY [)A\lAC;F, ]>[I!SOl':,\L I~JURY, r::V1PLOY\11,;.JT PI!r\CTICES,
[,\ND USE CI..\[\I, or PUI3L1C [:''; lny ERIZORS AND O\lISSIONS c.lu,cd by ;111
()('CURIZENCE
III lllL' event there is 110 C\)\'CLISC Cor it LAf\!D USE CLJ\lfvt tl)rough COllllllcrCl~l1 111SUranCL' ()r
lCII1SlIr:1l1CC, .'my emel.'!ge 1I11d(,1 lite \lclllor:Jllrlllll1 IC1l LAND U~;[ CLAltv1 sb:rll be 11l11lleJ I'cr
\,1 C:Jl lbcr 10 $5.0 1ll1l1lun per OCCUlTtllCC ;llld SS 0 Illllllon per a~lllll(J1 ~lggrC't;:llc.
BJ(T!' \Vlilp.'!y DITENSL COSTS 111L1I1TL'd ''.'ilbllllbC cOVn:r:D UL] 1\11\'11' NI.:T LOS~;
SECTIO"i II - DEFI:'iITlO'-:S
C;lj~ll<11IXL'J worJs J1Hll'hL1SCS 11;ln; :hc SI'iCCI:d 111l';1I1Jl1!::T,S glvcn III [IllS SC:CllO/1
1. AGENC'r' -- Illc:ms ~IrlY COllIKi!, COl1l1Tll::::iIOn, ;lgcncy, JIstrlct, .1l1l!wrilY, board or Sillli];lf public
ellllly lindeI' Ihe ,\l[Ml3LR's dlfCcllOll <"I' COllIIO! Of on '.'!;Iell Ibe \lE1V1I!ER's gOyer11illg b".'11li
SIts as lh,,: b\)\'Cllllng body.
ThIS Dcrlllilion e\c!lldcs an :ll\-port (,~ llOSplLd lh);lrd lJr ((llll;lllSSIOIL rcgzlldlcss orhov.' such body
is dCIlOllJln~ltcd.
2, AIRCRAFT u \llC.'lI1S ;lll I1pCla!IOIlJI \ chick dcsi!;l1l,d Illr tile Ir:lI1sp"rl of persons or propcrly
pril1L1pJlly 1111hc alf.
.1. ^UTO:V10BfLE nWJI1S;1 sclr-pn,pcllccl l;l!ld Illotor vehIcle (lIlLI/or tl':l1!er ('f scmi-tr,lIkl,
il1cludll1!; allY JIl.'lchcJ ITIdcllll1cry or equlpmCI1I, dCSIgllCd !or 11:1\'cl all publIc lO:lds .'l\1d slIbJect 10
1llotor \chlclc rcglstrJtlon.
<1 BOD!L Y IN.lL'R I' -- \llC:JI1S pliYSlc;d 111.1':!)" c\llolloml ,lislrcss, si,:Ll1css, or disc.'l,c SlISI.'lll1cd by a
person, including dl'<J111 n.~sulljl1g frolll <lilY uf these at JIl)' time.
(l:; - () ~ (1(,
:'1
CL.\I\1
IT.':;: 1\ :1 ClJiJiJ !1"C~,;"i:((\i i 'Ui .,( ,::..l Ii,' <. :l'\ L'i .,:1'-':I~~ \->~,ir,,:,(: il(i]] ~); (.\. ('{: ('II ' ;l:~,:\JI
dC:JIL~:)d. JC!ll.\;l, '.;\:11. or ~:dl ;l11:-:::i::::\l' il:i';':'-.'~ (~!;L': ;L.! ":1,;[ ~j ('()\Tr~Ll) 1>:\1\ i Y '1.1 IL....d\,.1
1):\i\1 :\(i LS C;ll:scd l)y ;In U('Cl, :.', RL :<( ';,
(, C()\TRi:;[) J'AIZTY u 11'C.'I",
;] nfCT:p,
b TiJc '.IE\1BER;
c. Tile :vlUv1i3UC:; GII'LC\LLS.
d. The !l.1EMBER's !\CiENCiI:S,
c, Wilh rcsl'ccl In JI1Y AUTOMOBILE o".lled by" C()VERU) PARTY 01 Ie"sed ollmed fur
use byoro:1 hcllJlfofJ C))\TRLD PJ\HTY, :mypcrsoi1 while lIslng ~;u(h ,\UTO~vl0BrLE
;1I1d ,my persoll or orgJIlt7JtlUn legally re~p(\llSlb1c for [he use ll:ercof, pro\'I<.kd its aclll;l! ll.';C
is \\'llh II]c l'erllllssilll1 of Ihe MEi\'lB[[~ !lowcver, Ihe f"IIc""'lllg ,"e nol COVLRLD
I' ARTIES
1. Ally' persoll or org;llllZ;ltJlJIl, or any ;l~_.;en{ (lr elllployee tllcrcuf, OpeLtllllg all
AUTOMOBII.E sales ,]];cncy, rep'lIr shop, SClV]ce ':lal]OI1, .II])]":.;" garage, or pllbl]c
parking place IIllh rcsl'eel 10 :111 UCCURRENCE ,111'1111; OLlI of li]e (lp,:rJI]OIl Ihereof,
llKJudlng road tcslIllg and dcllvlTY, or"
]1 The oWIler or 'lilY ic,,,'c, allier IIi:lI1 Ihe COVERED PARTY. 01 a Ie"scd ,>j 11Ircd
/\UTO\'10131LE OJ ;lflY asclll or cl11pluycc o[,<jucli O\\-llcr or lcs~iI..'c;
f. ,Any person or entity hoid:!lg a ccrld"ic:llc of CO\'CI;lgC tluly I::;sllcd by BICEP, as IIIllltcd
Iherein ("ADDIT10c":AI. COVUcED I'ARTY") i\n A[)DITI01'iAL CO\'UZED PARTY IS
1I0lco\crcd for eblln:; 'L1 ]Slllg fmlll !he ADDITIONAL COVl:RLD P AF ry's s<'1e I1cgl]gC]lLC
or Ill! cJ.llllI:' by illl(llher COVUZFD P,\JZlY,
fillS Definition 6 t::xcluJcs ;JJoilll powers a!::cncy', or ;111)' pCISOll or entIty ;1C{lllg pursu:Hl( to :.lJ(,il1t
powers agreelllent, c11lin 1h<1Il ']n FMf'LOYIT, UIlIeSS Il1c agency or aglecl11cl1l lS :rdded by
clldor~.;cmcn[ [0 thIS i\:1E\;10RANDU!\1.
-,
('O'i FRED J~.T)U,;lcnTY CO~;T1~.\(,T -- ]1I,:;n" "II ",:rcCIl]l'IlII'Crl:lI1llllg 10 the !\11'!\'lilER's nl
liS ,\G ENCY's rOul]]IC go\enlI1lCnl,i! Operal]OnS Ihdl ]nCldelllally rcguiles c]lller oflJiellllo defend
or Indell1nify annthcr pdrty !(1r HODIEY INJURY, PRCl!'ERTY DAMAGE or I'U,SONAL
11';.1 UR Y 10 a II1IrU 1M Iy caused hy an UCCURR I.:NeE
c
o
COVERED UU1M,\TE NU LOSS -- I1IC:rW, '"lllI11OlIl;! hy whieh Ul,TlMATE ;-\F:T.LUSS
eXL'ecd, Ihe SELF-INSUIZEiJ I~I: fEN i IlIN, bUlnol neceding Ihe LJ!l.lIT OF LL\I.lILlTY, lInd
\\!rieh 1111.1 ME,'v10R.ANDUM cOIers
'.)
D/d\f .", means ;IilY arl1ilci::l barrier, !()gclllcr \'.-'1111 ;ll'plJl{C.ll~IJ1l \\01 ks, \',hICh.
I~l 0', {)(l
2
I"
((, 1(,: ""],,),_' I]: hl'!~'!' r'i()~;l!
.:.!i "\ ,. : i);~' " .: 1 l_1 '.\ ,:!', ;,'-(ilir;-x <:;
t) 11;IS : '1 j:npn :1];.:11 :_', <- d)~,l,- 1 \' 0 ( ;; ') .kl '.::- j,.Tt (' ~ '~!I C
;\,,) .';trU,:'::I~rC ~j1':_'cli-IC 'Ily n;I.::1iplCd C:'t)J:1 j\lll...;dH.JII'ii by :)~l' :;;,1',:: \-,jC:i)~ (;il!l~l Dq'<,rI11I,,'1l1 ll(
\\":llcr RC::>l..lIIICC.S, [ll\ 1:,IU!~ Or~~,lrl'IY (",I D:1!1Y; ~klill<: J D:\\.l, li[~k:sc; .such '.;;rucllir'.: !', l:lider lhe
ji1IT..;di,_:tiu;i Uf":i:;:-- ::;,-'1:(:\' ll[ l;iL: fL:,k'I,i1~:,u\ell1J1":c:il
; (j D.\\ii\c;LS -- medII':) llWflCY C!,1I1;;tt;eS, ;:I!HlIJ1C!UJLS dlk:mcy fCT~, cost:; :lild II,tCC'S! aWllrded
.lg:llllC,llhl' CO\,[IU'I) l':\RTY
TIllS I )c[lJlitl011 excludes any dcm;lI1d, ;:h:lioll, sull or petitloll lur n,:sIJtull()!l, dis:;cH'gemCIl( JJld :lllY
non-lllonetary remedy or rc l icC IIlC 1 ud lllg L:lj U i ldb k rei It{ lJ1] U 11C: i \'C rc II cr, ad III IIlISI rail vc rchc f,
;lJlnl!llstrall\'c 1lJ;lJ1~LmlllS, or dccLlr.1lor)' le,IIcf ;IIlti JllY attorney' fee.s, COSh and llllCl'cst based
thercoJ\
T!:!s Dclli1!lJOll :J!~o exclude." ;liinr;lcy fcc";, (O"lS ,l[]d 1J11l'rcst h:lscd on a conlr.JClu;l] pitH lSlOll
1',11 f,<ll111g \\'llll1l1lhe deri/llllOil of jj 7. CO\'ERED I!\iDLMNITY cor-rm;\CT
II. f)Err~:SE COSTS -- I"C"I1S I(:;I\()/I"blc "!Iorne)' ke';, eosls '1I1d e\pcm':~; iI1Cl",,:d by Ih"
(,O\'FREU 1',\!(TY fOllhe "dJ''';II11C:II, lI1\eO'II;:l11011, rkr"'/lsc: or "ppc:<I ofa CL\IM
II/lS Ddinlllon il1cllldc~, CII)' /\ilor/ley on,cc Ice's, ""I cxclii,ks Ihe t, rU,1HUZ's cl'"111
;!dJlll11:~tr:llI0Jl C\PCJ1SCS
However, '1llorney kel sl"i11 1101 exceed Ihe "111:\ "I'l'Cilicd III Ihe 1.1.\ IJILlTY ["l',K
i\lAN..\(,L\1ENT Ri:()UIf<L~1U,nS, IInlcss Ihe H!UI' llo<lrd "I' DII('cll1/:; :Julllori/C," 11Ighel
r,llC'.
"'hi, J)c!11111ion excludes Ihe 'l1lor;;e\ fees, Cl"ls "!ld II1lnesllliill" C()\TRI:D [',\R1Y Jllcurs JII
c(l\'C'];l!:'.(~ or ollwl" disputes \\ l[!! BIC1~P
I ~ 1,}\l rLOVES u me,IIIS a p,"1 or preselll clecled or ,'ppolnlcd offll'Ii,I, el11ployee or valulI!ccr 01!11c
!\lE!\lB feR or liS AG L!\iCY "ellllg \\ Ilillll Ihe ,(npc o I' IlL'; or her cnlpln)111CIII WIlli, or dullcs for,
the !\lE,v1BLR or ACJFl\CY
I j P,1PLOYJ\lENT PRAC i iC[S n mcans a COVERLD 1'!\RTY's employmenl pr;Jcllccs, rollcics,
acls or omissions lI1al leacllo "" EMI'LOYF['s CL/\1\1 I'm ildr3SSl1lcIII, '\!ol1glullcnIlJI1JI;OI1,
\\ rongfu I Cll1p In)ll1enl, rail ure to h ire Of promote, rct:lIJ~1110J I, UIl L..\ \.-v CuI discn IIlI11dt lOll 01 \. wbrion
of (1 VI I nghts.
14, lNVERSE CONDEMN/\ TION n 1I1C3fl5 a CLAIM hy '"'y pe/';ol1 or enlil)' under Ihe CaIII0I111" or
Unllecl Slales C0l15111UllOllS Jllegl I1g Ih'lI Ihe MG"mER or ils Agency "as uken or dal11aged real,
personal, tangible or 1!llangl1J!c r'lopcrty fer pllbLc lEe lhlOUgl1 allv means wIthout p:I)Tllcnt of
J"sl compel1SallOn,
IS L.AND USE CLAI'\1--111"""5 illl)' CLAIM, oilier Ihal1lor INVERSE CONDer"JA liON. a11511l);
out of tile CI1JCllllcnt of an} l.ol11ng ordin<l11cc, speC! fie p[;m, genc!"]] plan, or similar regulatIon or
llse or Improvement of real prop~;rly, alll} the grJJlll!lg, dt.'l1Ylllg or the cOlldition;lI ~r;H]II!1g ora
0", IJ)_()CJ
1
(!! :';C I ,:1 I ('i I,! ;',
'.';:l;ll 'j
rd r;'1 :;
,I L
, I ~
.1,_"_",,,_,
"I-,c'I-''--'" .,
,j-. ,'i', : I,,: i,)' Ii l\'1 \t', ,I CU'I', j r l(1i1.; i \I:;'':
I" \.': : 1i i l ('; r '.;: !,: r~ (' C.
I'
.t;
l_f,\HJll lY r'!{u~'!z.-\:',i u ~i~,-',IW; 1111,' [.:!('j.p l ;,i!~:!:I: !'i'(1:1 il:l. ,:;li.,,'d
1,~!t?r ;illlC~~di1!'~'iil (Ii 1('\'::-';(-'11 :!l,illilC BjC!~I) 1--;,\::.-,1 ,-,lL'.:CL~\ ;IP]'IU"l'~
(' 'II!;'
LJ/d11LITY FiSK h1:\T,':\(;r\irJ\,'''j l<l''(Jl ;r<r~J\d~:" j:) ii~~'.l;]~: >,iill."1i! .\ 1;) 111i:.;
\-1E:\10R:\I\:~JLJ?,1, or ,JJ:\ Ltter JI1lClh!IJlL:il Of Il,iSlilll l)~;lt lhe U;\.-TP f\u:II'd ui fJ!i'cclcrs
~ll) Inu\ l:::;
1:-; IL\llT OF 1l.'\rJ1l1IY -- ""':1l1': LJICLI", L1\lIT 01 L1.\I<IL 11 Y 1":J CCCURfU,,\CT [()I lire
;\lE\HlER ill Ihe :II11011lll ,pclIIIC,! III Ilcl11 4 of Ik Deel:lr"IIl1J::;. :l!1J Jllc!lIdcs DEITNS[
COSI S. (Jlle L1Mll OF I.L\Jl1LlTY fOJ .111 CC1\'CI;!~CS ;,p/"I,e5 C()!:[clllcly [0 Il1e 1\IGdUf:R, liS
/\(;[NCII:S, I[S !-.'\IPLOYEFS <lnd o1llY COVLR.LD Pi\Rl 'r' ulldcr D,:f;'lII10!lS (rc "lid (rf
J I). \11'\lI\[:R -. me:l!lS Ihe publiC elltlty el'l ,"" cd :lod "rll11lllcd """ UICEP :llId nal11cd IlIltel11 I of
the [)ccbL:[]e'llS .
i() l\'lE\10IZANDUJ\'1 -~ rllcans thIs BICr:p :\Lh(('j r-"lCI110r;11lcllllll uf LlcJ1IJllly C'(1VCI;I~C (Jnd <lilY
cndoL;cllll'llL ;l{LICl1cd to r[
71 \11-:\101<:.,\1";I)U.\1 PFR[()!l -- 111C,,,,, illc pCilud ,.I:I;"d 1I111e'1I1 luf ilte DccLII:rllllns.
1: ',I iCl.b\R MATERIAL -- I11c:rns .')olllce M:lIcri::l, SPCCI,r! ,'\Jllek"r 1\1:11','11<11, Of fJyprodllct
\.1:IICIIJI Source ,\Litcn:r!, SpecIJI Nucledr \1.IIcrl,r1 "lid Iln,roduCI \ldlen:l1 h'J\c [he I11CJlllllgS
gIVen 10 Ihel11 by Ihe AI(1llllC Ent'rgy ACI 011 ')5~ :IIHI :111)' I"" ,,'l1cl1cLllory [helllu
:.>, OCCUIZREc':CF. 1I1C""S
:I Wilh rcspc'.,I to BUDILY l!~.IUR Y ur I'J<UI'LR TY DAMACF, "" ,,,'c'delll or evelll. illcllldmg
cor:l1I1LJOLJS or rcpc;llcd CxpO,'iurc 10 SUhS!;11111;llly [he ~~;Imc c:owlJllolls or COllrsc elf (Onllllel,
thel resullS d:JlJllg the MF,\10RA!\:DUM PER IUD III nODIL I' IN.lUK Y or PRUPITTY
DAMAGE neither cxpCC!Lcd lIor ill[clldcd l-r0J!lI"e slandp,"1l1 of II Ie CU\'LR[[) PARry;
b. W,lh respect 10 PERSO!\:,\L IN.lUR Y (other Ih:1I1 BODILY lNJLJR Yl, 1'\11'LOY,\.I[NT
FRACTlCES Jnd PUBLIC ENTITY ERRURS AND OMISSIONS.:in orfense described
ill the Detlillllons oflhose lenns tlrJI reslIlls III DAM.\GES dlll'illg Ihe MEMORlIi-JDUM
PERIOD
2,1. PERSONAL J,\.IURY -- means J),\1\lACES cJlIsed hl' 01 :1rJSIIl!.~ Oell of olle or mnrc of the
fl)llu\\;illb.
a. F;dsc (lITes!, dC!clltiOI1 or Imp' IsonJncnt, ma]lClOtJs pro:~CCLJI:Oll or ,lbusc of PIOC('.');';,
b \\'rol:gful entry or cvicliun;
c PubilC<ltion or utterance of material Ill,-Il slanders or IdJcls :l PC1:;Oll or orgtll1l!.:ilion or
dl51'UI'agcs a per son's 01 organJ7.aIJOIl's goous, products Of services, or inf, jngrlTll~/lf of
(I ~ _:",,, ()(,
4
(:,11'Y' I()':, [~lk [I: !\" ':,i:1, \j ,1j,l: <II \\ : :;'__'11 )}l,! ". i,i,.'I, "1 Ii: C!:,!; I::;ll \:'J!;!I~'~:I i'il"(';I'S
1::');1('1 .1\',1...'\,
d I':-'<Crr:ri!rl;lll('iL illiJ,J !l;,r:l L\iJ1j ()';:\'!i :<T Pl< \criCTS. h;t~;l'd tji'l,:1 r::c'-=: ICi!:~:I()::.
ILH1Unai::y, il;ltlnILl) ,-11 :g:ll, col..'r, UCl'I_J, SC\, SC\U;l! LJI1C~j!.ill')Jl. li,l!1d!l';Ij1. l!i:..dllll(;, iI:~C (If
C~;ljJ)llY1:;cnt ur \IOI;ll~O!l llf ,-~j\ Ii 11~~;lIS.
C .-\ss:lult :!Illl !J:ll:CJ v
POLLUTA\'TS -- llh,:;lllS :lIlY ;,u!ld, jl(plld, ,!:;:JSCOLlS, 01" t!Jt.'nn,illlT11:l!l( or (:OJ1tdi!\Jn:Jl1!.
IIlCL1clJJlg ':,IlWKC, Vdr'ur, SOL'!, fUllles. ;iClds, ;JJkz\)I.'-:, ChClll1Cds, slit, :IJrbllrJ]C i'JrllC!cS (Jr rlh('r~;,
mold, fungus, W;\stc, or electromagnet)c iiLid \\'a:~!c JI-if:Jljdc~; !I];llcn:ds ~o ln~ dJscJ!dl.'d OJ I.il~
rc:cycJcd, rccondl:JOllcd Of rCCLUllll'C1.
rlli~; D('fillltl()tl exclllJc~: pOLlblc \V;II(,I, ,1L;llcuIIIILJ! w;llCf, w:IIl'r (urn]: hed!o CUIlllnCJTI;J! l~~cr~~,
or W:l!ef llsed ror TJJ"C slIpprC;SIOll
:2(J PROPFRTY DA\1/\CE n ]J1l';li:::;
(l Ph}':-,Icil il1jlll')'10 [;lrJijl!11c p!upcrty, lt1cll!dlllg ,lll rc::u:llilg lu~;s ufllsc nftl:dl P:lli'crly, ur
h Luss (lfw,l.' O[l;lI1~:lbk prOrcrlj' tl:,lt i:: nul phys!c:i11y IJ'JIIJ'cd.
C1. 1'l JIll.le: ENTITY l]i.RORS ,\ND OMISSION:; .- 111<.:1I1S <IllY "'"k:1c1IlI,~ SLllclll'-'IlI, "I ;)II}' '1('1 01
01111"'011 Or;] COVUZI:D PARTY. whether by 1111 JcaS:lIJce, !IlJ!t';,I'rlllCC or IJUnCC,ls,lIlCC, 111111
ITSIlII" III II CLAI"r Jg,lIl1Sl!hc COVFRUl I',,\IZTY
rillS I)C(i Illlillll c,dud,', HOD 11 Y IN-'l' 1\ Y, I' IZ01'L1ny IJ.\".l.-\CE, I 'j I< ',cn; 1\ L WIL'I! Y. alld
r-i\ll'LOYMFN r I'[C\CTlcrs
:'s Sr::LF-INSUIZFD fZElLNTION --lllL'III" I Ill' amUlIll! stalcd !!lIlem 5 (1{lhe lkellllatIC'J1s 111.lt Ihe
!\'lfci\HlER filll'! r:JY kr ""eh OCCURRENce [or jlldglllCI!IS, se[!knell!s and DI::I'I:N:,E
COSTS A SIII);lc Sf'LF.I~SURED RE IU,nION "pplles coIIeCI"cl}' to the l'vl E".1I3 LIZ , I!S
AGENCILS, lis EMPLOYl-TS, 'lI1d allY COVERED 1'.\ln'Y L1!lder DefinitiullS (,e <Il1d (, r.
p~jynlCJ1t hy \-JIJd ;lnd coJ1cclal.dc insurallCc ur olller co\'cr,lgc aV;lJl~itJ!c to the 1\.-1EMf1ER, Its
ACE!\CI ES. ils UvII'1.0YELS, or a COVI:RLD !';\IZTY LInder UeJillllloll 6.c "iJ'llI.'Ippiy "Siill,SI
the SUF-INSURHl RETFN110:-.i.
2') ULTIMATE !\ET 1.0SS -- IllC;1I1S Ihe sellllS i,"" hich llie MEMBER IS liable JS D/\rvIAGES
eilhcr by i](ljtldlCZllioll or hy COlllrrOIl1I,Sc :dlcr 1ll:1Klllg ploper deduction for :dl n.'C(l\'CrlCS :lIld
';;"v,,~cs "lid 1I1l11ldes [)E1T~;SE COSTS
~(). V./ ATLrzCR/\FT -. lllC:lr1S ,lll olwrZJI itm;l) \TlllcJe- !n excess nt .1) f~':Tt (j(.'s:g:H.'d felt' il1c 1[;; '::.:port uC'
pcr~ons ('\1' propCl1y prmcip<.ljjy nJI the \\-Jlcr.
(J.l ' ~ I <; Ii (,
,
~'d CTI(}\' ill -- r)r:l'F:\~;F ,\>..D .~~: I~ Ii. :.H-::\T
Hi~~TI' :-;~l:'l h:l\c iC r!~h: b,l~ :1(1( 1111_' du:". [(1 rl~~i!ICliu~'..~ ;:1 it'; 0\',11 C\lic:1....C !!llIL' dckn~;L' (lLIII~'
C L:\L'd o!\':t!)]S!.) CO\'!. VED l).'\l,~-j 'y' liFil UICLP ,-!,~! rllll!H:S \'.1:1 ;;i\clv resuit :Jl;J CU\'[:.RLD
l'1 '[[',lAl f' :~E riO',,')
..\1':<'1 l~lC 11ll10Unl of il1c SI'l.F.I\!SUIZI'D RETr.0:TiON bs IJLLI1 exilClllsled by Jl"Y111Llll of
J"d~;111ellls, SCII:CIllCllh JnJ D[FT!'-iSF COS'] S, BICrl' Slllllll cIlltlll1rSe lilc COVLRU) PAR ry
lor )j:lY fllr'iler DHFi'<SE COSTS \\'llhin the LIMIT 0[" 1.l..\flILlTY even If lile ltllcgalwl1';
Jg:liflst till' ('O\,'rl{FD P,ARTY arc ~:oullclkss, L1Isc or fraudulent
1. ~'OI"lthstJlndlllg the ItI)O\C, UICEP shallnol hdVC Ihe obllglll;oll to dcrend 11r rLimhursc Ihe
DITENSE COSTS of Jln E~, 11' LUYf'E I Cll1e !\'IIJ\lB ER dclennines lInder Cllllfonnl1 c;ovemnlcnl
Code seellnl1 9(l5.2(lj) 11);Illl1c [\1PIOYEE IS nol clHllled 10 11 dl'icl1sc 131('['1' shall, 11I),,"e\'el,
rl'illlbuise DErr~<SL CCY;TS If;1 LOllr! dctClllllllCS !h~illh(; ~1f:.~1f~LR has;lll ohllg;lllOlllo P:1Y
lhL'!1l
4 i\ CO\T;, feD I','\"IY shllll Iwl sct!1e- <I CL\J:\l I,,, an ""1l"JIlI In exccss of tile ~,ll'Mnr::,'s
SLIT J~iSI!"E!) IZLTU<TIU"I \\-llhoul ,hl' CUIlSl'l1t of I; ICI '.I" s floard of Illrectors.
5 BICEP sll<lll 1101 ',cllk a CI..\I\1 \\'IIIH),,1 tile MF\1BLR', (('llSeI11 Jlo\\-cvcr, ill Il1e C\'"nl JI
,\lh\lnr:.R dnc~; llol t',1VC Its COIlSCllt to :lCcl'pl a hOIl,1 fide 1ll011Cl:IT)' SCttlcll11~llt oJT('r, B1CEP's
11,'hI11lY shll!1 be IlllIII,'d to the llllJ<lunllhl:IIlICt:!' \\'(,,,id I,,"e I':"d 111 stich s,:llknICI1IIf:
JI S",'h ';<:11",,1('111 ,kl1i,lnd n.ccclls the \llc\1UlfZ's SLLF.fNla'TU:D RI:ITNi'IO:'\ hy
lS()I),(J(i(J, ,1I1l1
11 II:e \1cll1bcr sl1,lIlll1l1'C C\I"_IHlcd or 11ICLlII,'tI ~25(),(I(II! DllllCHl' III DEFFNSF COSTS
('. I3ICFf' ,'il,l: I nol he c<~:'[il.;Jlcd to pIll' Jll)' CL\ 1','1 c'r I clIlIt-lirec !)EFU~SI: COSTS "Ilu [he JIM [ r
OF I ,[r\ Hll.1! Y over [Ill' SUI'-li',SURU) IZI :TEN n()~, 11IlS been lendered fm s,;tlkrnenls cl1id'",
DEFFNSE COSTS or h;1) hel'l) CXhdL!sk'd oy Pd\ll1'':lll of judgments, sclt1cmcnls ,md/or
Di[,ENSE COS IS
SECTION IV n ~IE',\IJEH'S SELF.INSUHI:O RETENTION
AND HICEP'S l.I~lIT OF UABILlI\'
D!(Tr',: iJOIbt!liy to 01 COVERr,) r ARTY lIS ille resu,l or Jill' olle OCCURRENCE IS ",dy the
CO\.'[]<1:1) ULTIMATE NET LOSS
o
cor Ihe purpose of e!elerrllil1lng Il1e SELF-Ic.JSUR[D RETENTION line! LIMIT or LIABILITY,
Jill DAl\1c\GES ariSing oulofcOlllilJllous or rC[Jellled eXl,,'sure 10 C1Ul's!llIJlilllly Ihe SJlllle gellerlt!
C(lIId,I;()us or c(1l!(se ofcollducl ,;11,111 he C()I1SlderL'd,lS clIIsi,,~, oul orolll' OCCURRENCE Juril1g
the lilsl l'I'plic;lblc CO\Ulli'C pcrrud
n ~ ()<; I,r,
~FC IIO\ V -- C\J\'rl~:\(;F l'f':H.IOD ;\~<n Ti:t~IUTOhY
"'I I (' 1""'( I' 'l'l "1 ' .)'. '\("" "c-
!:1.: LU\Cla~~t..~s ~,Lj:(;lj III ...:,LCi!l'l:l u! {j~1" ;\1r.:\l,I"J\ ,~}S :T)~I':' k 1 ,\',~:._iJ..J
OC:CLi\..IZ[:,CE :1!:Y'~!iCrC lr1 :l\l~ \\'orld dUrlllg the \:L:\10R,.\~~DlJ\i !)L'["~IUD
c;iu:::cd b\' ;:11
SEeTIO!': VI - L\Ci.l'SIO'\S
"[!we .\lEJ\10KANDUI\1 does 1l0! 'If'ply to ;IlIY CLAI\l [or or .IrISln,", out Ill'
COlltJnli1l311011 of lhe en\'IJ'onrncllt by POl.Ll~T .\NTS 1l1tl ouuccd <1t Jny l\mC, lillo, u!ldn OJ upon
land, the aI1l10srl\lcrc, or allY v..'.}lcrCCHII:;C (\1 hody or w:llcr or ;1L]lllfcr. '} his cxcluswl1 JppllCS
whether l,r nollht..: C01l1;lrrlln:lll(1]'I is llltluduccd ll~tl) the Cl1V 11"01 lInC\l{ Illlcnllnn;111.v or accidcnt,lily
or gradually or sudlklll\', ,uld "lietlier or nOI tlie CO\TYFD 1':\1\'1'1' or "llY ol\1er persoll'"
org,\lllZallol11S lcspon.slb1c [lH lk: COnlJ11l1:-';lllun
"Cl..llll:1111111:Jt W!1" 1l1e ludc:s MI)' line lc;ltl, 11l1s,-ilc, ulllnlh::;J!111[U! con, III un, ClthCl ~ICll1~t1 or pOlenl i:d,
which J[1~.(:s ('lit ()fll1c rr('~cllCC ill the C!l\'IJOI1111C'11l ofJIlY POLLLJTAi'-j r \\Ilcthcr jlCllll:mclll 01
lr:ll1slCJlL
"[llvJronmCJl:" Includes !;lJld, bndlcs or\'\"~ltl'1. tll1dL'lgruund "\'(I(tT ()J \\'<.ltcr table or aq111fl:r, tile
;ltl11osphcrc, and :my other ndll\r~l1 k<.lllllC (If the CJJ'lll, \\hcllJt...:r 11I !lot dllcrcd, dc\dupcd or
clIltlnted
ThiS C:\C]\IS1011 d()l'S ]Jut :11'p1y. 10.
;\ /\ Jl Y dl sch,lrgc, d 1~';pcr~.,:J1, SCl'p;I~I,I~. 1111 :_1,1'-)\ j(',d, rc lc;I~~C or ~-':~'''::lpC () r PO I -L :TA NTS lh:~t I Jll'C\:;
all c;j'll1l~ !lllll)\\-,lng (on;!lliuIlS
L It \Vas clccldel1[cll "lid nCltiler (xpccred l10r lIltc:ndcd hy the COV1,RC[) I'J\ETY" TillS
cnndlt:()jl \\'ould not serve to dellY CO\C.T<.1gc for <l SjlCClIIC I:JCHlcJJt wl1t'rc such
dl~;ch(lrgc, JispcrsaL ~)ccpagc, J111gr:ltion, rclc~ls(; PI' CSClre ill' i'()lItlt~lnls waS;1 result or
;Ill ~1llcrnpl by the (0\/[1<.1:1) P:\RT'{ to Illltlgatc or ;1\~Jld :.\ SllllJ!IOll where
SlihSI'l!1[,,1I1111ld P:ilty be,dily IIIJury, I'ROI'UnY D.A.~li\(d: 111 PEIZSONAL INJURY
could uccur;
jl. It V,;JS dC1ll0nstr:lkd as h:lVll1g co;~;n~cnC'.::d ()f1:l srccill'_' d,.I!I: during tIle tcnn cfthlS
IvlE\10RANDl'M,
[II, lis commencement b,:came k11I)\\'11 10 ti,e COVElZED r..\lZ l'Y \\'tll)Jn t\\'enty-one (2 J)
cJlcndar days aJ1d \.\'JS rur1hcr rCl'orlL'd tC! the person rCSpC1JlSlhk for flsk nlJllJgcmcllt
at tbe ME~m[lZ \\Ilblll a rCClsol1!llllc 11l11e /1111111';
IV Its COrnJTJCllC~IllCllt W;IS rcpUl1cd 1Il \\Tillllg In BiCEP \\'lthin 5.Jx.ly (GO) GlIcl1clar (bys of
bcco!1llllg knowll to the pcrsc.n rcSroll~,!blc ror llS\..: J1l;lf1af>~1l1l'l1t ~l! the fvlL;\1BFR, :tIlJ
P,l;j~;( ~L:L;:,,: ._r(,~):t \.',,~''; ~\;,~ .-;dc,; :~~, L ( ()\~' ;<1 ,J f'.\f< 1 Y III ttTJ111,j,llC' ::IC ~,I!l;;I:Ii..'ll
,is ~,l)\':l :1' C', :i"llIl \ h 1)~ I! I 'll'cl
I f~'.\\ ("\'cr, ~w11 : ~:~. L(':1!,:lr~cj 1:1 :~ji~~ P:-O\I: ;url ~.i_;_I] I Uj- : J:C r,) PIC\'J,k ,1i'1\' :':lI\l'~ ;:gc
\'. ~:l~ IcspCd 10
(1) :\)1 \' ~;llc ur !nc;lt)(11l pn IlC I p:i11 Y uSl'd L,y t I:c CO\- ;,: j,) F f) P..\ R TY (ll h) otLns nn
tile CO\ El,I:!) />.'\I<l\ '5 hch,ttL Ip! tJL~ h;.-tJll!::Jlg', q'Jr;l~J..:, d.' P()'~;ll, dUrl1j1l1'g,
pr()(~'ss:llg or lrC;!1Il1Crlt Of\\.:lstC l:lJlcrl;t!,
(2) An)' filles 0:- pL:lj!!iL~;,
(3) Any c!c;-in ur costs o!Jcred hy Ihe superfund progr-:l!l), or JIlY fcdl'!dl, state or
local gO\'Cllllllcnlal authorIty Ihw.'Cver l]lJS s~wClfic exceptIon shall no! ser\'e In
den): covcrJgc fUlllllnJ parly clc;m up costs otIICf'\\'I.SC covered h.y thIs
J\1L\101~/-d\UU;.1 simply bcc;JUSC Oflhc llJyohTlllClll or;:! go\'crnlllenLII
<.Ill thon t y;
(4) ACid """,
(S) Clear! lip, rcn1O\'al, COnl:lllllllCnl, IrcallllcI1I, dUoxdic;lliOl1l"J!" nculralllilll011 of
I'OI.LUTAr\rS SIIU<1lc'd \111 PJ('IllI';\'S lire CO\'E1ZFI.l PAin Y owns, Icnls or
occupies :11 lhe tllllC or the ;}r!lIal thsl'h;l]~~C. dj:~pns;ll, SCCp;lgC, llligr:11IOIl, lCIl';lsc
or esc"pc of s;lId f'OLL.lJTAN IS, l)f
((J) \Va!cr pollutlcm ell/sed hy 011 or Its dCllv;l1J\"l'S
h D,\\l.'\CJES c"used by lre"l, slT1ok~ or fllllle: flOlll;J iroslJie fire "llc'sliI-.- fire" llle:lIlS onc Ikil
bt~co:ncs IJncnntroll;ll)lc ur b!T~lks out where It \Vas n,.'Jtlntcndcd to be,
c. FlrcfightJllg :lctJ\.-jtJt?S, l!lcJudlng trallllng fin's, ur in!cnll011allgllltlOll offJrc~; for the pUll"")ose
oflilllltlllg a lire, or 10 the dIscharge ofPOLLUTi\~,,"rS for [he jHllVOSC OCCl,)lllruIJlIlg a fire:
d PolIce use of Jll;lCC, uleoresln L'Jpsicum (OC. or pepper ~:;IS), l)1 lC~lr g~\S,
c \VcL'd <lbJtclllcnt, tree spraYing or sudden Jnl! llccjd~~llla! sewer ]J,Jckups.
f U:.c of chluIlllC for dUillC;IIC \,"olter, sWimming POll!.'} (H other r'-)lJ'lIIlC Sanl!:lll()11
2. Governl11ent,,! ordl'1's, direcllon'; or requesls 11r,,1 lire COVElZED PlllZTY lesl fur, Ilw",lor, cklll
up. rcnlove, remedy, COIII,,,n, IIC:1I, detoxify or neutralize POLlUL\NTS.
J. A gO\'CllllllCll1:l1 Ulllt or ether thIrd party's Joss orcxj:.'c:nscs, lilCludll1g :lltoI' 'Y fees, L}]"l:f!C,I.:s lot)
l11(1nii'JI, cle:lllup, relllO\e, lellledy, contain, tr"ce, ddoxdy 01 1lcutr:oIize f'OLLUT/\N1S.
4 H d/,11d(luC properlles uf 1'1, leI Ei', j(, ["IXIT j(, Ij\L
5. DAr-v11\(ji S (uIJlc:.;:~ an~~!ng out orllJbil:ty it,,- F!\lPLO\{;\j[NT PR/\CTICr~;) It)
!!'\.It'i_(l{;
"
o
, .\:1 :?\l!TC)\'l'[': \'.llh;:1 ;L~' Lt'l:::-L' :~l~,j :-,(UI':': (il hl~, III :r.i ur::':(I:''"llh:i!t c:)~:...,!:d hI' :i:
:\11 \1LLR, ire; :\(I[><C\ 01 i:~. \l, r,\.~\\"Li
b. .'\]1 F~\IPLO'{J.r'f, e;pou<;('. child. [1;:1_1IL bIO!]li..~ll.lr s;~;ln Ic,ulLll':;, rrol1l tlie <lets llU)JllI~:')I(\J1S
oi"tht..: [;\1PLC" 'f:. \\1111111 ;h''';C;'Li:C;C ,Ilid SLopcofj:i:l Of II;..:r C:l1ploY:llcr'.lliy tIle.: i\1U\1f3FR
\.II it<.; .'\CrLi<CY
Tills '~\clw;lOn docs !lot (\;']1ly. [;I)''.C\('r, \0 tile I\lL:HULR ('II' l!~, .:\CiL.;CY's I:,...hil.:y llIlLl'...:'r;J
((JVLI,E[) 1:~UI'~11\1 I\' U)'~ IK\C I.
(, The I!ahillly ofJn)' ~IL\1I3ER 10 lis ACE\!CY, U! 111l' ACLNCY i,) the M[~II1[R.
l.iJhililY of J COVERED f' ARTY to lis Oil n pJst Dr [1lc:<nl employer.
S J.J;lbilll)' ofa COVElU'D !',,\RTY lInder Deunltlon (,e 10 olll'lhel COVERED I'ARTY.
{). \\\Jrkcr~;' CC11IlPCllS;\!IUll OJ tk,:lhlllty: hCllcflts Ll\\" or ~111Y .'d!nlhr lil\\"
Iii Usc or opeI31""1 hy (\r IIIl hcl",lfoflllc MF\1BEI<:JS respects
<.1 Any 110:"111(al
b ;\i1Y llc:lIth (:(.11"(' provJ(!cr hccJuse or hIS or her pfOrCSSI()1l,lI ;lrl~, errors <"'1" l1J11lssiollS
TillS c"eIUSIOTl docs 1101 "1'1'1\' )0.
J. Par:lJllcclics, CJ1~Clgcncy lllcJlCal tc.:.JII1JciilllS, lllcdlC;t1 C\~11l1111erS, k<..hllll.'UIlS,
pllkbD!(lll1lst:; or nurses, but (l]]ly \\ Ill'11 ill employ oCtile 1\1 Erv1 BLR 01 lts ACENCY; ;lIld
JI Occur:ltion;11 ph)-/';iCJI e\;UllITlatIOI1S, tll!1L~rClllnSIS It''.;!lrrg alld 11llIllUIlI/;111(111 (('IJ1ducted ~l!
the d:rcCll(lI) lllthe ~lr!vlHUZ ur liS i\CiH,CY
c. Any CI:llIC or In/l11l1:!ry t!1:lt ILlS:
OVCITilgJl( L!CJ!lllt..:S; Of
11. ThaI perlorms lIlV;IS1\'C surgery. 01 ;lilY kind, or
cl. AllY pll;)nll'lcy opcr"lcd by or for Ihe \1FMBER 01 ils AGCNCY
11. H llptu,C, bur:;llflg, 0\ crfl\.Jv...., SCi.:P;lgC, or rclc::lse ur failure to release water 110m allY DAJ\t
12. ['l!JIIl! vc or CXCl1lpl:H~,' dJl1lagcs, or ddlllagc I1lUliJpks such ,l~) dou[,]e or trehk dam<l!.lcs awarded
pursuJ.!lt to stJlutc or lip.\'.
L} The CO\'tRTD PART'Y'::; ;t;:lll<ll n:llid, corrupllOll, 01 ;JCllLll malice
] il. 1 he COVERED PARTY', "willful C1"I",;lS lIsed II) IlIslIr;]nee CoJe S,'el;(\11 5JJ,
1,\1_;1')_(10
()
!' ;'lZUI'!S i'\' '.\\',\C.! '"
.! j'II..")I,T\:. U\',ll_'d h:- i]l''':: CU\ Ll.:i.j) ]>:il~.TY
)1 jJi"r'l'11y I('n:cd It' (l! 1c,1~C'd h.llJ:l: CO\'LI{i:n P..\IZl Y \\ih.:I\~' th-: ('I,-)\'LFLD I'.-\J\ i''y' 11,1:;
.:I:;'~,:ill(',l 11,J:I:lll1' J(-,r dJllld-';C lo Ui dL\llliClliJll nr :,IJlll ]110[1('11)'. lllllL~<..:,:; the CC}\,j:I~J:U
PAP~'J y \\,(lLild Iid\C blxn1 dblc 111l11:: ;:h:;.cllcC oC\lIch aSsullJpl:UIl (lrll;JI.'llllt), I..~r
" ;\il,Ci<Af-T or W,\ lTrZCIZ,\I'T 111 the CO\LiZU) !',\RTY's Glle, custody (Or l,,;;IIDI
\.j Opcr;lllon orallY tr,lll'-;lt dlstr]C~, fran.';I! c;y:;tCIll, 01 pllhJ1C 11~1I1SpOi'I,111()11 system c\\'llcd or Ol'cr;llcd
by tbe CO\ERLD P,\RTY, exccpl allY tr"":ill system opc::1!illg <:Icr llill.iixed roule sy";tclI1s
slIch Zi~, "dIal-a-ride," SenIOr CllL~CI1 tLlllSrO!1;ltioJ1, or handIcapped IIJn:.;p()!1dlIO;1.
17. Ov.'J1Crsl1i;\ 1ll:l1111cll;JIlCe, lO~ldlng or lllll(i;.ldlll~'>. use or operation or (111\ \IRCRAFT, ;lirficlds.
rlill\vays, hJ:lg;\rs, h:'llldin);S or olher prnpcrlics III C01111CCtioll \\'j{h JVIJtlOIl Jctjl,'lIICS. IIo\Vc\'c:r,
III CUllllccllOIl v.llh ;\Irficlds, fUnWlJ) 5, ll:1n.l.~J1S, bl!JldlllgS or oilier propertlcs III cOllnerlion with
<l\'),l1lllJl aCllvJllcs, lhis exclusIon sh;lilllot apply to thuse ~lrr..'as open I\) the public fvr the purpose
o(cll(cnns, leaving, or uSIng 11ll' ;llrpon LlClIl!IC5, lllClutllng pJrkill~ ]ols aild giHJgCS. "LO;HllIlg"
(Iild "lln!oJdlllg" or /\IRCRAFT ;-IS set fOl1h '-Ibo\'c sllJll !lot ilpply: III rUl~1l1lcdlCS, nurses or
l'lllcr~',CllCY l1lcdiGll tCChllicld!1S
Til,s l'\Clw"ol1 "l'l'ii<:s ol1ly to Ille co",'r".';", for UOllJLY I,,:.; I JiZ Y '1'11<1 I'ROI'LRTY LMflLV;I,
1 ~ F~ll1urc 10 SLljlply or pr()\'ldc;m ;ldcqU;lll' supply of g;\S, \\-;ller or electr;clty \\-Itcn such [:lllurc 15 '-1
rl'SU i t of the roadc,!ude) oflh" CO\' F R CD!' AR )"s t;,,: ,I,:,es 10 "'1.11'1] (Or produce ,ulrlCrcl1t g;rs,
\I'-<ltef ()t- eketrlel!Y to 1l1C:1.:t cW~I(~rn;I~'y ;!Tld CAilCL"!l'd JClllJJhl.
] l). EmlJlent d01l1<11ll, condelllllatlull prOCCC(~lllg~,
CU:\iDI:~I"'A 1100:. by \\h,rievcI flJr:1C Gi,kd
rcgul;][ory \:Jk]Jl~~s or I!\Vr:RSE
Thrs excluSion ';1",11 1'101 apply 10 [lhyslc:J! rn.lurv 10 Lll1c,iblc tl:lld.parly pr0pcrly, rncluding
rcsulllng loss of use oftllJl i'lopclly.
20. [lenel;ls pJphle hy a l 'O\'l:.RED PARTY under IlIlY employee hel1efit pLln (whcthel the 1'1'111 I';
vulunl:rrrly cc;t.lblish,cJ or mandaled hy stalulc).
Tlrls cxcluSlon docs not apl'ly, however 10 hah:!lly ofa CO'.TRFD PARTY f"l ferrluil'l'.' SeGHC
such benefits from a third pJrlY provider
21.
f\C;UJl(l pfuxc;" fees or ~Iss('ssmcjjts
~) 'I
..L
Remulleration or GnanCl;"]] gain l.n \,-'hkh ih: CO\'rE[D P,\RTY \V~IS llct !Ci:;~:l;,>, l'llll1icd.
~ 1. \V ill fu 1 \' io lall01l 0 f oJ pCJl~Jl code l)f Old l1l;l1lCC COmI11111cd by 01 \\-'1 t11 \! Ie kllo\\ !edge or COlbellt () r
Ihe CUVEREU PMZTY
24 [slim;llcs ofprob:lblc costs or cost c~[:m;il(::; bClng exceeded OJ Llllll)' prcpar:ltlon t1(hd
(J,\-()'\ [)()
10
"j'UI:h ;l1:\ ,-j-; ( l'
-', :.j,,,:,
. : ' i I _',~! L' i ,~! J': I j , :.,
Foll:IIIC :,) ;Hrr()'I11, Cl Ijj'_',i,_-i~ ():,;: ":'('11ti:ll.II::il \J!)::'_>l!1t_lI:, L\'~:Lj"l [,\1 I:,d'lil:)
;1 liJ,1: W,,:'L:._I br~ J;;'l'(y;cd:j) 1111_' ;1:):;'~11CC l)i'li~L": C(i!l!r:'(:liL!; \Jhli,~,l:I'JI:
h ;\::'~~J11j::d ,,)!dlt (1:1~\-.' C_'O\'LI~]~L11~~DL~1. IT\T (-U~',-I F./\CT
~0 'j ill: rJllJ11())~~c J<elnclilt:!]( IliCUI11C SeCtlr!!y .\ct (,f I (}7,-1 (I~I.:rS!\) ;l:-jU :lilY 1;1\1,,' ::n:C:lr];11Cll','
t]lcrcln, or :111)' S!;ltC S!;lll;!C ur common IJW rule \\.111(11 IIllP()SCS rl(~~Jcur') uUlie-; ;J1:u
rl_'sf'ollslhilrllcs \l,'iih rc~'rccl tn employee hCJ~tril pro;::r,lI11S
27 The CUllsol,d:Jtcd 011111111", HUI!,;ct r:'cconllllcllJ(lll Act of I '):,,, (C:Of)j~.-\).
2R \V,lr, whether pr nnt dcc)~lrcd, cIvil waf, or I'C\'011111011 or ;J1IY :1('( or conJllloll IIlc](,knl to till'
foreguing. excepl ICn;J f\H__:i\'IDFR'~ Ic~;pnllSC 10 stich acts or CDlidl[IOilS.
2() The pUlCI1:ISC. ':idle, l~;SU:ItlCC ;lnd 1l0IJlll,':_~ <.J[~l'CurJllcs, lJ1cludltlg bulllot lil111lCd to honds
30. /\ lockout, strike, plckl'lI:I1C, H'jl!JCCrnClll or slmJ!,lr (lCllO:1~;;11 U}I~I]CC(i()11 with LdhlJ dt:-:putcs (ll
Lihor ncgoll:llllH1S
I his C.\CIIlSlOI1 docs 1:01 "Ilp!) I,) tllc ('ovcr,I~',l'S 1,'1 IlOUII.Y f:;IlJRY "n<l I'I,lJl'ERlY
['!\ MNrI"
31 Tile CO:;! o1"IllCidlfying ,lilY buildlllg Ol properly Jrl Older tu 1ll~lkc said huilding or prnpcrty lllore
;!l'cCSSlhlc nr ;llTl1lllrllodatllig 10 ,IllY dlSdbll'd pelson III COlllp]!,HlCC \\.'1111 the AIllCIICII1S wIth
D:sabilillc; .,\('1 (f'lIblJe 1."'.\ I () 1":;(1) or SIIIII!.,r st.:le 1,,'.\
~,FCn()", VIf -- CONDITIONS
The fulJo\Villg ~nc cl)JldltIOJl<; /HCLL'Jl:1l1 to cllverage llndl'l !JlIS J'dL.\101~/\NDUi'vl:
PI::mllJrl1 :tnd Jlllht:
" Thc MEMBER sh,l!1 pay till' [Jej10511I'rCIl1IUIl1 desi~~Il<lteJ m llie Decl:II:1110115, '1I1d :"'y lurlller
premium 11l<lllhc LL'\BII.ITY PROGRi\,~,l rCCjlllres.
h IlICEI' Illay examine Ihe MlcMBER's books and records tl1:l1 reLite 10 Ihe subject lI1aller of
thiS !\1EMORA1\DUM at any reasoll;il,1e time lIl1til len (10) ye<lrs "fter the fillal tcmllnatioll
nf coverage under Ihis MEMORANDUM or until all kllOWI1 claims nollced LInder p'.Ir,J~LI!,Il:;
hclov,: l1:ivc been clo:-;cd, \vhlcllc\ cr occurs !a~:t.
7 IwpectillllS
BICEP 'h;dl be PCfl1111!ed, bUll', nol obllgaled 10, Illsl",,:t the tdl'MBEf, 'sprcj1cl1y "11,1 ol'er"li"II:;
;d ,my rCJsnn;"lbJc llllle, NCllllcr sLlch right to fIlnkc Inspect!uns !lor the; making lh\~rcur, !lor JIlY
'I; P:~i\()
11
r '- ;~,,":1 l] kl Cl;:', ,) "I): Ll~l; ,1 [,,:'_' :::-, di ,,:, i"L,j,,: ,,' ":" ' ,'\ \ r' I': I, 'llh_' 101.''.,-; it l r! 1-:1.' .\ J 1:\ 1 i~ I;~, 1.',1
i:':!:Ci>:, Ll (k\(:l;~Ji:l: ,If \',,::-!,':1! 1:,:[ I,h.:: ]-';\\)il':::, l': \,;),~;,:~:I')";; ,:.\.: ',;:;.,'
'\ D,ll'(':, III tilC C'.LTI (::1:1 ,'.:'(L:;1 '1::.1.1; '':''I,~:!:]
The CO\.TJ\FD P..\f': 1 Y :-,];;1:1 kJ\. :]11'; dl.lt\
J lnlhc C\'(:;]t oLin OCCL:RH r~!'"CE th;il Ljll~: WJ1L\ill!lC 1.,1:\13:Ll11" R;S~-: \L\>~/\(;L!\1L:<'1
Rlf)LJ1RL-.I\1E:';..J rs, to ,i::l\'C \\'rrtlC!l !]()l!cc :lS SOn!l :1(; pOSSible to J3fCLP \\1111 rC:lson;lhly
obL.iIIl;lblc IJ11urrrld:J(,I]J Jlhllll the tll:W. pl:Jcc ;IPJ CIJ-CumSLlllCCS :]Icrcof, Jlld Ihe 11;1I11CS .111d
addresses orlilC inl'o!\:d CO\TRC[) r..\FTlI:S ,,",,1 \\Itl1csses
b, rr'l CL\I,\! IS ll1;;rll' i1r legal "CIIOI1 broughl :J,C;JII1stlbc COVERED I'ARTY 111I111;]lls Within
Ihe LIABILITY RISK MANi\IJ!:\ll,>n REQUIRE\IENTS, 10 fonv,lrd 10 HICFI' every
demalld, nOllce. SU11I1llOIlS or olher plocess received by thc COVERED PART\' or the
COV r.REI) f) AR TY', rcprC,el1t:lllve
c 'I,) ('l)upCrJfc f:Jiiy \\-111: UICEP 111 the II1Vl'Sl1g;11101l :lJltl dcfl'ILiC,
d. Upon 131CEP':.:; rl'qllc~t, In (!,C;Sl~;t 111 cllfn[cmg :If1Y rlFlil 0Cconl1!iwIIP!J or IlllknlJ1J1Y,lglliw,(
<IllY pelsoll or OlbJlllZdllOIl 111<11 1I!:ll be' Ildhk 10 tbe CUVUZI,D P."d{ I'Y bccallse of ""
OCCUI\RL\JCO'I: wllh lC~pc;cl \0 \\'}-llch COVCl'Jgc IS ;dTurdcd !lnder Illls i\'1l:i\10IZANLH;:,if
c. To Cll1Clld hC;lnJl~_'.<;; and ll);.d~-; :llld dS:;]~;t III ~:cnJr.J)g ;\1ld gi\11lg c\ldcllCC :llld uhtJllllng !lIe
atlCJld;Hll~C or \\ 1l11(,S~;CS
I Tn CIJl1lp!P\ltb 131('1-1", LI:\IJIL!I \' RI',;I( M/\!\!ACF\lFNT 1{[Ql;mL\lE'~TS
t ~\1() nJ]ull[,irY P,lY111CJl(')'
1110: CO\' j:kED P,\RTY ,lull,wl. n(I:1'1 al Its OW11 COSI, volulllc1rlly (thai I';, Wllhoot flICTP's
:lpprT'I\<lI) lli,ihc ~l1lY 1':1:':llCtll. i:1S:<lllllC :I1lY nhlJg:lllOIl or 111Cl11' ~\ny (:'\pcn~c, IlH:I Ucllllg DEFI:NSE
COST:;. ,tiler II bs cxl'dl1sll'd liS SLlJINS1JIZLD J\I::Tl:NTlO,\!
) B:lllkruplcy ~1I1d lJ1soh'l:IlCY:
jJ:IllknlptC\ 1'1 II1S0!\Tl1l'Y or llil' COVERED PARTY sli:lll nol lelleve BICEP or any of 115
obllgalions herelll1der. J\'or sb,111 the bJJllklTpley or IllsohClKY clf Ihe CO\TRLJ) P,\RTY
JIlcrcasc UiC[P's obllg:I!JCill:) hcr'':lIlldcr.
G Olhcr COVCI,lgC:
Il1surance or olher ellVuilgc ,lv:lll:Ih!c III the COVERED PARTY for a CLAI1\1 (whuher <'11 a
rfllllary, excec;:-. or COIl!lll::.~,CI1! !~Jsis) Sklll be prinlary 10, Jilt! slJilllllO{ COlllril)lJ!e wilh, lIlts
!\'lemor"llcbllll'S cover"ge; except th:Jt Ih,s provlSlOIl sh:r!IIII)1 apply With respect to the excess
lflSUrJncc purchased spL:cdicJ!iy (0 be ill cxc:t~:s of JlllS !\'l(~Jl'iOr;.lIH.llllll, or to l:lsurance or
rcinsllr;lllce which is In","dcd 10 "!oVld,, the relllC'll1der ort:'L' U\111 01- LI.\BILll'Y sLited ill the
LkclarallCll
(:3 -n<; ,0(,
12
I-I " :\!' ,; '] l'~-C '.II i l" ::'_l
/\n '{ 'Ct '!~jj.r!'-'~CL \\ :ih ;1 ,!,;1;i::':-':l ('J r~I\.:JC l.U:\ (lI:C' \11 ',1(:J<_,\'<r)! ::\i PL-i\.!:)j) ~Juil ;11'
llt_';ilr.:.i JS;1 C,I!l.,-'Ic OC Cl :1<.1<.]',".\.'[= ~:rl";l).\~ dur::l:_', ~,'_ \H \l(llC',;-<]')[ :\1 ],Ll~ (]f) \\,:;(,111)](:
Ul 'CL:j, ]-?,:~f<C[ hCg~ll
rrl(iu:"(~lliL'I,1<; h,1:1C 1\11 \!~_;j<.",.>.UL:\f.
l'';OllCl' Il) ;\11Y :lgclll ur kIH.\\kd:.;c posSC:,S(l_: hy ;1J1:-' agent (q Ly ;J1lY u~I1c.'r pClSUIl "ll~:llliot ~1I1L'rt:1
\\;\J\'~r or '...'j1JI1!~C III ,1:1\' 1':11'1 0Cijli~; I\lFj\10RAl'-:UU;\1 OJ Sl0p BiCEP frum JSScrtlll,'j Jill! ]'j~',ht
undcr ti,e lerl115 o[ :h15 ~1E~1()R,V~flU~1, Ilor SI1:,] 1 the l('illiS of LlllS ~1DKi!{;\NDlJM be
\\'~ll\'t'd or l:hJ:l~CJ, c~ccpl by c11r.\ursl'l1H:nt 1~;~;lIcd lo fU!lll <1 p;U1 oC\IIis ~,'lE~lUHj\NlJUi\.'l
f) j'\h1 tlliJ,lll;lrly bCl1cfil':;lf1CS
~.,JnthiIlg 111 t!llS !\1F\10R_.\~~DU~.r IS IJlICIllkd 10 111i.lKr: allY pCI~:nn or C!'ltlly, ul!Kf i1J;lll ;1
COVLRl~!) P:\R ry, a tllirJ j),llly h1~IIC1JCI:ll)' or lllc C()\'Cla~c lkll this j\1F.ivl()J~t\N/JUi\1
pro'v'IJcs,
T11 1 '_; \1Ei\10R.'\i'\DlJ\1 Cl);lrcr~.; no (O\TI;I:::C or hCl~dJ(::; on ;\11)' liC1S()!l or CI:!lly uthCT l!J;iJl ;1
C()\TR ED PAR'I Y; no personllr en: ,Iv "I!ier 1]""1 II CCiV L: RLU l' !\R IY ,ldl hen C 111(; ril;htlll
1111ng <l lc~,;ll actioll ~lg{\lnsl H1CLP, \Vllholl! lIS C,OllSCnl, (0 dCknlllllC IHCL P\ (Jh]lg:jl!llll~; 10;1
COV!<R!:D PAR IY ""del Illls f.' H.10!, ,\>mUi\1
II) SU!'Ill_,g;illUI1'
Bleu' "1,,,11 he ,ubro['alcd 10 ti,e exl(,1I1 ofClny I"'yrncnl!iClcllli,icr 1\) the CO\TRLU 1':\I<I'Y'5
lI~hlS ofrcco\rlv II,c,eo[, IIlId Il,e COVERED PAR IY s!ilill do ''''llnllg "lier leoss 10 j11\<.Jlldlce
such rIght Jnd :,11:111 do c\"lTyllilllg IIl'Cess:l!')' (0 SCClllt: ~tll.h rls1-.t ;\11)' ;l!1lOUllt so lTCO\'CICli shrill
he zlJlPortiuJll'J JS r(dlov..'~;
;1. The c.\pcn:c,; of :lll slich rcco\'Cry I'J(}cccdJll~;s ~;li;lil he: j1:1Icl befofe J!lY IT1l11bufSC[lJCnts ;lrc
mack. If there IS 110 rccovcr-.y III the proceedings C<Jnuuctcd by nlCLP, then DICEP :;11;111 bC:lf
Ihe expenses thercof
b. The hJghcst lJycr of coverage shall he relmbursed firsl ;!J)(.J, lClhcrc be s~;lfIC1Cjlt ITCO\'Cncs,
then the ncxllJighesllaycf, until ;]1] recoveries ;nc tI~:cd up
1 I ,\:;"'gnlllcIII of inlcrc:;t
AS~,lL'n!l1Clll or jnt(.:'~TsI under tl:L'~ t\1E!\v10RAi0DU\1 slull not hInd UIClP LII1 k:;s ;1ppro\cd by the
BICEP B03rJ ofOJtcct('ls.
12 D:;)p down CXc111Sioll.
BICEP's U\!IT OF' LL\B1LlTY .';hllll not he incrc:J,cd fl)r IIny 'TII,('n, 1I1Lludil1g, bul Dot limiled
10, Ihe rCrllSII! or l[):Ibdily oftlie COVERED PARTY In PllY Ihe SELF .INSURED RETENTION
Of by the rcCus;t! or IIlahlllty of any 1IIH.lcrlying insurcr or JOII1! puWClS dUtl1Ullty to ray, whether by
I cason 01 insiJlvcncy, banknljltc\', 01 C'l\l1clwlSC.
III ('" {1.',
, ,
;:1 ;jlC )]1:,1::--
Jf 1\'.',) l~lr rnC\lC :,IF\1!;[:R~~ ;:rC](l:J~[:Y \lr 1')]1;11\ ;i11;\ r'L\-C!;~:]': 1].;\1::: ("(11 tile ~:!,n~~ CL.\JH or
OCCURRE;\CE," SCpilLl:C "~I: U'.i ',';1 !in:!) IU.TL>: riot'-: 1c,,1 L1\IIT OF L1AI31I.1TY "['pi,es
c<,llcr:;\'cly I() e,lch \1[.'1I\1:R "nd 1:5 ,,\(JL;\CII:,':, Its p,jf'I.UYLFS ,,"d 'illY (O\T.RU.1
I',\RTY 1I1lc!cI l.1elllJ:11l1l1 " C
1:.1. SC\'Cr;-I[ll lily.
ThiS !\-lE\-lOR/\',,'DUM """ Ihe term CO\TRFD PARTY se\'clally Jlld nol colkcti\cly, so 11I;,t
II applies ScpJI<!tely to "",Ii CO\'LF:l:D PARTY as i111 wele tlie ollly CO\'E[I.I:1.1 PARTY
1I0we\'er, this PIO\ISIOl1 shldi nllt IIllle",:( a I'v1L:'dI3ER's SELF.[NSURf:D PETENTJON or
BICEP's Ui\-llT OF L1.\HILlTY
15 IIlIClpIctall""
a T]lls 1\'lE\IORANllUM dl'CS 1101 p'll'cidc IlISlIl""CC so Ih"lll1e IUIe 111;" a[[ 3mhlgllltlcs lllu:;1
be cOllslrucJ ;lg~lI11S( an JIl~,\!rcr docs not ;Ipply_ TIllS rdFr'vl0l<..'\i'\DUI'v1 shall be con'ilrucd
acc:nrdllll: 10 llie plll1Clpks ol'C:OIlII:lCll:iw. gl\lllg fu[1 c[Teetlo Il:e Inlmtoflhc \lEMBLRS
alld lllCIT's BoarJ of Dllec:I,,::; In .lduplll1g II.
b. TillS '\1 r:I\IOR.\ ~:[)U\1 skill be IIlleq\lclCd I\dhl\lI! rcg.lId IDlhe dr"fter. II" tellllS "!lO Intcnt,
",!h respect 10 the lIghlS II I l(1 obllplIons 1\1 :IllY CO\ [RED PARTY or 8ICLP, sb,1!1 be
InICIl1l'c!eo :lI1d conslrllcd l'n Ihe express aSSUll1pllOn Iheil Ihe MEMBERS and UlCEr>
partIcipated cqu~lIly In jiS draftIng
1(, [."W ~'(l\'crnllI!, tlie \lL\H'JR.\>:Dl:'\1
TIlts l\'1Lr\'1()RAi\;DU\1 ~h;dl be gl.l\tTrlcd ~1l1d l.'OllSllt1CJ III ;lCC()ld~l!llT \vith ~hc Ll\VS urtllc SLI;C
()/,C.ll1fc)Illl:l.
17 Cancci!Jtlu!l.
TillS MEMORANDU:\llllay, wllh respect to any tllFMBER. [,c cancelled hy BICEP on nlllely
(')0) da)'s' nollce eilher 1m II Ie thcncllrrcnl MEMORANDUM PERIOD or, III thc e\'clll of
cxplIl:;ion, pCrmJllCnlly' upon lhe OCCl1[TCllCe of [he C\"CIlIS c.l1ld under terms 5ct [(HIli III tIle
I.I.\!3IL1TY PROGRAM
19. N;lIllcO [\'1cmbcr:
Tbe M EMBER fir>! na!lled 111 Ilem 1 of!.he DeclJratioJis IS Jl!!l:orizeo to act on behallafitsell~ its
AGENCIES, liS EMPLOYEES, and allY COVERED PARTY undcr DefinitIons 6 e alld 6fWltl1
fe-speC! to giV!!1g ;md frccivlllg Notice ofC;\Jlccll:Jtion and for rccviving an): return prcmilll1l lhi.lt
IllIlY become ,,"YJble u\lder IIIIS i\'1[]\10RANDUM. Th.ll rvl[]\1Bf], is "Iso respo\lslble far the
p<l)lllCllt 01':111 prCI1:111rllS
() J, ',I ~ _ {1(1
1,1
L\.lliBIT ",\" TO meE!' ~lL\IOH\:\DL\1 OF COYF:lt\GE
BI(; l"mFlT'<UE:-;! C/TIF'; E':CFS:; POOL
LI;\I3!1I1 Y RISK MN<A(;IMf::-; f PH)UIRL\l E~TS
10 DEFIi\ITIONS. TI1c Deli"itl{'"s III the BICTP Mi\STER \'1LMORA1<DU\1 OF
CO\'ERA(jE (MLMOR,\NDl.Tl\1.l "l'l'ly lei c:J[liIJlil.cd \\'ofLL Illlilese Inhlhl)' PlSk M.IIl":"l'I11l'1l1
Requlremcnls ("Requiremellls")
2 0 MEivlGER's RISK M/\1':J\C,FR E:1ch l\lUelBER ,h,,11 h,,\'c "lid I11Jilll"ill J 11I11-llIflC n',k
m;11l;lgC1l1cnt employee, or suhjcd to lht~ llIi;\111l11011S ;tPjll()\';ll of tile Board, shall 11;\\( either: (J) ,1
risk management prokS~~lOIl~d, 0: (II) ollICJ\\lSC Illust be ;tblc to demonstrate a sOll11d Ilsk
lll:ll1<1gcillent progr:-nll.
] U. 1.0T;S PIZLVLNTIO\! PF()(i1ZA;\l E"l-h MFMBFR sh.1I1111""1I:LI1" IllSS r,"VCIlII01l
p;Olr,r;llll, ;llld ~h;dl ;lCt t1P\!l1 :1I1ITCOJlllllcnd:illlJ!1s oCB](LP C0!1CCllJlng the leductlon Oflli1S.lfc
l...,1IHII110IlS Jlld [!Ie correction O[pOIIC1CS or prJclJCCS lhJt JJC llkl'ly 10 lead to CL/\IMS.
~ il. !ZECORDS
4.1 The \l[f,l[3LR slr:dl CIIL'llISll :111 :1111111:11 :IlLdilcd 11I1iIIlC;,d sLllc111CIlI to llICT!'.
42 fhe M[:'vlBER sh:lIlln;]illlalllllldl\'ldllal CI:lli11 Jiles cUI1I:IIIl;ng Ihc J)OCuIIlCl1laIIPn
spc,crlied in Section <),] lor :Ill CL,\I!\lS for Ihe ]lLCCedlllg len (10) liseal )eors. The Illes
::hall be referenced and ::,IOICd lur rctllcv;d h~y' Crty CLllln l'-":UJ1lucr.
..) 3 Tll\..:' [\''1l~:v1 fH~R SII~1l1 rndlll(;lill :1 COlllputcr-gCI1CLllf.'d spreadsheet ShowIllg lhe
lullowll1g IllrOrr11:111011 by eolumlls fur all CL.:\I\IS IIllhe len (10) precedll1g [isc:" )C"15:
. Cil\' CIOIl11 No
. BICEP CI:11111 1':0 I jf :lny]
. CI:I11113111
. City Del'al1111(;[11
. L.oss D31e
. CI3i111 Dale
. DcscL'lption
. CUITent Stalus
. Amounts Resen'cd
. /\11101lnls f'::td
. Dale ClosuJ
4.4 Tile ~1[r\"lB[R sI1:t11 sub1llit cppie~; urli1(: ah()vC' ITUHds to BICEP a:.; dlrecteu hy its
fll_1I' (l(, 1'::;
:'.~':il \:,.Ii:l'.:'-'! or :1') (~:.;]\' l ':ll ~ul , :.:l:i,
~,i) 1)] ff<<.':.!: :\lTORI'.'FYS :\>-,f) l-r:: :~~
"! ':'!Jc ~\1Er-~!OER ::::li:t!J we q'i:iil:(lcd ,k[~~!;,;(' ~:llr:!li('~)S C\Pl':klh:U! i!llll]':::itli'~, !::~ type
urCL:\I!\.-1 :\\ ISSllC
52, DleTP tCLllllS the rl.~hl t~l ;1~:;[\C!;l1C lIS ;Jlf(\rn\~yc; \1, Ill! il1C :dE\iPER'c; d[!~';T1<,:.; in the
dC[l::JhC of any CJse tJIJt tlle Hie :_P Dn.!l\! or UJrcclurs cklCrll11nCS l1J', D/\\l:\(JL.::: L::'xpO:;llfC
111"t \\illllhcly exeecd Ihe ~.l[:\lLJFR" SIL.I i:<:"i:fZIU RI. j r:, I[O~. 1 hi', ,;~LI (,I
as;:OCI;l.!JOll extends to IWlltlOIIS for rcil:..:f \'lOl1i the C]JIil1 rillLg r('\jl:II(~nlcIl:s.
5.3 lhe i\lEj\.1BER :;hall c0l1tr,l('1 to P;}Y OLllsldc dt[crlsC ;JltIJ11l:"~.\'s a rC:bCIJuhk Llk Cor lhe
t)11C o(CLA!l'-d;]t ISSLle, 110t 10 exceed S'25fl <111 11(\\lr, lInless t!H: HH:LP B()~lfd olDJI"":-l!nIS
;JLJthorizcs a Illghcr rale \\-')l1ch dc!cnlllllatl(ll1 ::11:111 COll~~ldcr the USII,d, cu~t()nury :U1J
rc]snn;lh1c rdlc {"or tile compkxity oj' Ih: CL/di\1 al issue.
54 lithe \1!'l>!BER ekcls to defelld:J CI-/\I,\l tllIoIISh lis Cilj i\!ll)r!1CY Of rice, mu'l'
Will credit SI50 allltoll/ or Ihe ,\lrMIH-,\{', actllal cosl (as de:nclll!',tl:Jtcd b)' Ihe \l1'k1flfY),
"!lIche'. ellS grealer, lIS DFFEi~SE COS I'.'; IIIr services III deicnsc 01" CL.\Ii'vl The e,l)'
:'\lIl)r!1C)' OfGcc sh,1lImaIl1t;1I1l ItlHllly III1IC lecen cis
:) 5 The I~:CEr Boz!J-J uf DI!cctnrs IlL]\' jXT1()(..Ilca]ly revIse till" r.ltC:-~ 111 SCCIJl)ll:~ ).\ ;tlld S 4
lo Jelled [JJt:V~lJllllg attorney huml)" Ll1cs
5.6 The i\1E:\1IiER Illay selcct, ,ubJL'CI tll [,ICFP's apprll\'IJl, ,1l1 :lIlL'rnall\e Illcllwd of
aCCllll1l1lllg 101 DlTEI'4SI, co:, IS, slIeh CiS i1le leSUlI:ce ,lIl"C:IIOlll11ell'llci
(; 0 ',ICnICE OF CL\L\IS AND O(TUZJZF~jCES
(, I ,,'\s ',0011 :IS pracllcable, the \1 1'1\1[3 I:R sldl plovlde illCI'!' lIlih lI'fIIICIlIIOIICC "I :my
CLAII\1ll1 OCCURRl:NCC Ih:lllhc UlCEr ~,Jl:~lOR;\N[)UI\'l COl'elS or potcntl.lliy ell\m,
II
. The i\1EM[3ER reeerves the CLA!M or OCClJRRENCF II) ;m "111011111 "I k",t
equal 10 501;,'0 oflhe 1\1LMBFR's SELF INSURED REII:NTlO~, III ,'i,5(10,U()I),
l\ hichevcr is less.,
. The CLAIM or OCCURRENCE has d pOlent!:1! DAI\J..\CI:S exposule "I iellst
equal to 50'Yr, olthe i\1EMIlElZ's SELF-INSURED IZETFNTION or ,'i,:Oll,1I0t),
1,l.,'lllChevcr IS lcs,;;
. The CLAIM or OCCURRU,CE Illvoh cs p:1r:lIysIs, l>lIlIn dal1l;lgc,
d;:;menucnncnt, OJ dedlll, ur
. A single OCCURIZEi\lCE reSl"l, I111\l'O or Illore CL\iMS that. In Ilie ;lggICgClII',
~ll-c reserved ;It, or l1~lVC J rntcnlldID;\\l/\Cj[-,S c)<:posurc Jt lcJ~t cq~I,1I to S(Jf~'0 oCthe
rslFI\1lH':I('s SEI.F.[;'4:;URI:D ],;:'-1 ENTIOi') or .<;5()1),()()1I, whi,hever IS less
O).itS (I()
1(,
II"
, ,",
j~ ~_'-'\I'~~ .:;1,; (' ,';:I'~.I: -" ilj' il":""::
IT', " ~ <
I, t,_' '"I
\ ( I: " ~ \; , l ,\ ,11 J' I.. I J" () 1 ,', I, ,'\
):,J:1 !];( l L,I!, ::i:~ \li'\:hL-l('~, r"C'llli:l1i (\i")';,,;(: j.:! L.:, :il',,;;ll :' ,_;,t\)111,."\ 1'" cu>I,. :i:,\!
pI', I ~.,,!:-: :;': ~-] 1; ;:': ',,: i'
.<1.1' ::!'] !l'
I"',,
,le' I~
70 CLl\l:'.I:) ...\j)\1]~<I~_;-! l~.-\':-[Cl:'< .\L'U! ['
J 11(: H1el-!' L~(1:_lr,1 \)1 U;ll:C((\IS :-;!n!i :.('I'_"__l:l CLI~:-~b ..t:d:1()j
Ut:ll/::ig t1:c LL.J_,j:lly C!::llli:-_; ()u,;I\i~, C~~lit]O! (j\il!kIII1C'; 111 ';Cctit.'!\l () bcll,,~'.'/, :h:
;]llljl!Or slLl]1 condt]ct :1 eLllliiS :1-11111IliSti'dIJt'I'1 :J11dl1 OI1Cl: :lllllLLJlly, (11 i1:l'1C U!ll'll :l! ')IC
di_<.:crCI](1n uCtilc BICEP l1(IJI'd lirUlrl..'Cl(I]'s, I"Jil1Cllldrly If
. ThC'rc IS <lllllllli:,U:l1 Jl\!ctuall()J1 or I11C!c.l~,C 1rI th~; 1\!L0-1D!.P\ d:l\I1l~-, c^I")nit:!1c~ (:f
11\I!llbcr (1 r cl;u!l1c;;
. rlll'!':_' is;J r:h;ll1~e oCllahilJ!y Cldl1l1S dl~1l1\Il!S:IJtl()fl flIIlIS, or III )j(HL';l~
CL}!llE./'lilJ.s~JlI()ll Jl1d]).~SC:t1('llt, or
. 'j Ii<: tvll:~lUI.1< IS dew
7 J. Within sixty (60) ,1.IYS of!ccc,!>! "f'he <l1IUII repurI, Iii" 1\11'1\.111[R sh,'!1 rC"pDI1d III
allY rccolllnlcJldati(JflS ;11]d sh~111 Clll1cl otllll!1c 111 willing ,1 progr;\lll fur corrccll\'C ;JCllOIllH
CXp];111l \vb)' the ,~'lL\lCLH. sh<Juld !lut be ll:qulfCllln fu]!u\\/ tile rccol~~rncnd;l!l(JllS.
~ () ;\CTU,\ I( JAL STlllY. The melT BOllld "f Di'ect",s \,h,lll (lh:;;lI1 <Ill Ilclll<ll1ll1 sludy
performed by d Fellow Ollhc (';,S 11:11 I I' Actlldl1.J! Suclcly <l1l!1lillJly, ullllOre oftell ifl:ldlc.lIcu. I1l1s",1I
0" Ihe actual;,,1 reel,!!1']]L'Il,!llt;oll" rJJCFr sli,Jilm;JIIl'JII1 !(nefl'cc; i1IHllhe MF.~1l31:R sli,lIll1lll~c
rUI)(I\Jlg COJl:nbllllul;~; cquJllu J.li cxc('cdln~ 1he "Pru.lcckd 1.~]III!ldle Losses" SI10\\1l1111hc ;\Clll,HlJl
IqltHt.
'I (I J.j,\13ILlTY CL.\IMS ()lL\LJTY CONTlZOJ (;l'!DU.li':!:S
') I The MBmER will
. COllt!uct il1\TSllg~!tll\il \\itl11l1 lhli1y Jays or the t\1L~.'lHER 's kllo\\ ledge of lile
CL:\Pd, JJlCIUllillg lah.ll1g st~llC1l1cnts from p~lnlCipal1lS and v/lil1csscs.
. Develop 11lfonn.:Jtlon rl'~J.rlllllg Ildblilly Issues, jflcJudlr)0 '11l11l\J11t1!t's, CC.:l1FJf,llivc
llcgli~cncc,j()int IOl1rcasors, and JujJlt amI 5CVUid llJbillty.
. DcvL~lup infot111J!JOfl 011 {!:tm:lgcs, illCludll1g property d~Il\li1ge, nature ;]nJ extellt of
baddy injury and cmollnn:11 dlslrcs<; CL11111S, medical (l}sls, ;md l~CI\1l011ljC u:Jlll:lges
such JS w"l:c loss, IllSI profits 211d loss of gllod" 111.
. Ohl:lIn "nu review conlracls Ih31 rnilY be In effeel relJling III specific accidents,
sllch <.IS hold harJllless and lnJl'l11llity JgfCCI11Cnts, additional in;:urcd rcquircIllclllS,
other ;ljlp1JC:10!C lnsur;-mcc policies <lnJ juilll pU\I.,.'crs agreements with other public
entltil'S
[];;1:'\J()
p
. ,
. Ui-'!;1,11Ik!'I'I\( in,')I! lei "J .\1'(:! ': .,:\;;~'_':](:(~ ;I]~i~ i. ";\\ iJ:!\ ;]1: pu.:-::;;i,,~t(~q ;\1
it;!,~ :(:':'::11\,' \\I:Ll:': :':,~,l'L ;11"11'1,-1:' ,!:c \,,':i~\' I, i.:; ;1:1,\ :~.h:;\!:: ;';'<Jdl:C't il::"lii\1~;jil;)11 ((Ir l~:','
),
~ t '(~:1/C '~'\P,--;-::~ ;1[i;'I]('f":I,_,;\"ly Iii C.l'~C;S
.. ~,r.llr;::'I!11 !:1Cillh~'i:;!llp !11 ("Llill:'-; ;ild,..:x PU;C,'lll, pi(h i,~C t)iC EUi'CJ1. ',l,'Itli Ur-J.1iC,l
:lld(:\lil~; l!ifn!'ln:ltIC!l JS ::ppl,e;:h1c, ,:ild i11.:~c: Inqulflcs \,]1 CL111l1S \\)H:ll;!1l J!\(kX
nl._llCh OU:U;'S
. ,^,rr:lliSC :lrrIJ1S;J;:'; fl)1" ~LllJl:',ll,cd properly.
. llme!y rqH:I[ to Ble} P ~lr;d :illlilSllJCr~, tIJ;I{ [Kr!,,:111111]y pro\'jLlc 11L;ur:lrIU~
C()\'cr;l~C
9.2, TorI ClaIm Rcq~l1r('IJlc!1t~: The i\1E!'vlBER slull gIve. <.II] notices (pcrtain1Jlg fO c1:1l111S
lilSI11T:C1Cl1C:., 1~ll1in:ng 1:1:[' CL:IJT15, c!:lnlls rC)CC!ll):1~;) l1i ,i\.__cu!(Ll!~Cl' WIth ;lpP!J{::lhk ];.1\'.'
(j~. f)oLtI1nClitatl<JIl
')~) 1 The i\ILi\1I3LF :-:.]1:1:1 C'-,I(lhl)~;i1 r(,~:~;OlIJblc lcc:crVCs b~l::cd upt,n rdcls knO\'dl.
\\'1\1;111 thirty (JU) d:i\S o!rCu.':lpt of 1'l\'C:~tlg~dl\'C rC]101t, \\,'llli expenses Illcluded The
rC~;l:r\'('':; sl1:i!liclkrl the ME:\lHER's !W!C1l1J;i! C'\po:.;urc 1\.) CLlllll:lllt'S :l1tOIIlCY fees,
cosh anu ]\llct{~sl, lLqipllC:lL1k' TIle l'-.ll:.i\,lHl'R ~;ll;i11l1llHllt(J1 lL:~CrVCS for ~l(lcqll~\(Y
thl uugl1oll\ (1)(: ]1 f"c cl" the CI.;\J~l arl~llll{)dl f"y thelll ~IS 11('Clkd
9.0 I. The \IL\Hn:R sll<l!IIII:IIIII:III1" (1:::111 fIk Oil c"cli CLAIM "C!<liw:lllic
MLMi1fY or liS U-iI'J.OYLE
t) ,) J '1 he c)dilllS Illes ~,IL\!1 C011\JII1 dUC\llllcllt;ltJ~-)llllccc';sary t,~ s\lpport the
dcc:s:c1ns made \'/I!h Ic'-;rCC! to <.l1spn\11IorJ (lfCL,-\IM~),
(),,),f.4 PII\.)l~)S, dl~lg!.1111~;, pbns, (Cllllr;lcts, Il1cdJcal and Ll\\r enforcemenl rcporl~~,
rcpo!"!'':. l)rlllV('stl~',.ltll1!l, ;lttnnH.:y ICput1S ;llHt oll1er rcil'v;'ll1t lhxull1cnh slull he
(lcP()~ltcd ill [he CLJllll file III :.l tll1lely Ll~,II;uIl
<j 4, Rcqll~rClllelJts for \Vllllcll E(:'port~; flUP1 r\1[~.lU[R':; de!cllse attorney Jltcr t!h~
i\lFi\Ii1Li( h:1, 11!:lccd hlCLl' Ol1l1oll[e of" (Ti\L\! or OCCURI\ENCE
941 The f'v1UvlBER shall rr\Jvide lis olll,,,de dcCclIsc JIIOrl1CY(S) with wl,ie,s "I' the
allached (a) BlCEP Defense ,\llonley Eq)()ltlng Reqlll11.:ll1ellh :"Id (b) BlCEP
LitiC;ltiun PLlll and l>llJgCt.
I) :\ 2 rhc rvrE~/1r~LR h:lS ~hc rl':~poll~;JllJli~y of cw;un:lg 1,]1:1\ liS oU!5Hlc dclCnsc
;\ttorncy(:.;) cOlllpllC5 wllh BIC[["s H.'portlllg <:l!ld blld~;clll1g requirements
<) 4] If I::':.' CIty j\lll):ncy IJUicc serve:.;:1'i lc;1d (Jcknsc d\lorlley, It 5h:111 jlfCJ\'ldc
HilTI' '\Ilh lire I'r<:llll1in<l1'\ Eval"al,"" descnbctllll Secilol1l oflhe "tlached BICEP
Dc'F.'l1sC ;\tl(Jlllcy [(cI'011"',; I\cqllirCIllCIJls. Other\\ isc Ihe Clly ,\llonley Oflicc \\111
r. I ' - - ( ~ s -: ' ( ,
IS
h;; rC~luli,-',j '1:11> 1;.1li ;"\' nl{ } II >', I!:I ::" i],"_lliJi 'L:!:'-,' .Ii t_\,li\i, :l\_~:j il-jhL'l
()..:; 4 T]\,-"c T(jl:ltlXiL'il1; ;:Pi'l:, rt':J,;:,di(';~ (,I \\iH-,1:~'_; (jr ]]\'! :~':,-'rc IS ,1 C(\\CI;\,"":C'
CllrHI(~"'L'l...;\ \JL'!',\'l:l':lI5H 'I, jl ;~'Id 1l1L ,'viLi''.li~i_l<'
lJ.5 IJLF[:<~~r (~( (~TS
9 5 I Lpon gl\l!lg !l0: ICC 10 U :CF i' "f " CI.M\ I", (leu) [( R P\CF, t! "' ,\ lr,~,11s [I(
shJII rcq~]lrC ll:~ OU1SH.lC dc:(t.:ll:;'--~ ~ltU1JllCY(S) to Il:-O\,IUC th~' BJL'L:P ('!:tll11S
r\d:rll]lislr~)I(1] \\ !th u,ples l1fmOIllhl::/ hilllll~~~, flIt' d((Omcy It.:cs ;md ollllT !)LrLj\.'~-;F
COS IS
~) 5 2 The ~lL\H3[R's fisk l1l:lnil~~Cr UI CLlllllS !1];lll:1ycr )h;lll k:..'cp a CU1Tcllllcdgcr c~f
payments ufoLllsldc IJltOIllCY(,.) fces and olhel DFITNSE COSTS, ond shir!l pro\'Jdc
it t(l BICEP':; CLll:ns .'\dJlII111SIIJtor upon n:quc:;l.
C) 5.3 The Clly !\11l1nll'Y Onicc \1.,';!\ !lot he rClJllll-cd 10 S~d)lnll a 1l10illlJ1)-: rccurd df
DLI-'FNSE enS] s Iluwc\'cJ', 111111ISt keep;l currcilt !L'curd dC1CllmCllllJlg Illcrll
l) (J Sdl]CIllCII{
C)(} 1 TIle \1rr-.'fJ3f'R's dCC._'Il'-;l: ;lltonll:Y(~) :.;)1. I prO\'ilk BICEP \\,)1]; fully C\l'i.'lIkc1
!Cka5CS, sctllcll1L'111 :1!,;.tl'C1Tll'J11S and, \,,:hen :q;\lHljlll;llt', ('purf CIHlol-~LJ COplC::i cd
dISi11ISS;l]S ~lIHJ s,-l1j~f;ldl()llS OI.llHlgJlH'lll.
I" () IlfT,\I~1 f
I (l, I f\.,'o \'11'-:\1 Bl:.1\ t\::ll slJb~LlIllld!ly (()1l'lpl:cs \\'llil thc.'-.,,,:: i),L\luI:C'!11UltS m~lY he rl_HlIHl III
def""I!.
1 0 2. 13IC1i' ;;h,,!1 furnISh [I,e Ml::dI1LR wIlh \\rJllcllllu;,ficl:,OII uf the J\lI'J\1BEj\'s
Llllllrc [0 comply \'1-'1:1) these K('qlllrr~111C:1l1~;
] 03, The !\'1El\.-H3rR shall [Ul'lll:;h;\ Wl"itlcl\ rCSpOJEC o1l1lllllng ~l prnSf<11ll {i-Ir corrective
<lcIIOn, or sl1o\\'JrIg that II !1:1S subslaflli;:lI!)-.' COlllplit:d \Vlth IhcSL' RCqUlfCJI)Cllts, \\'Irhllll!lldy
(30) tillYS o[recelpt of nICE!"s Ilotdieatlull
J 0.4. I[ [)lCEr :Ippro\es cOlTcell\e ;]ctlon, the J\.IEj\.10E!\ shJIIllllpJcIllCllt Ihe approved
progral11 within Sixty ((10) days u1"llo1icc or:~uch Jpproval
10 S. FIIlI'.IIc to cure noncom!,I","cc l,ursulllll10 ""'llons 10 J [11I(JIl~h 104 shall conslitute
311 event of ucfllult ill ;:CCGld,U1CC \',ltl1 ;he !.J.\BIL,j ry I'R()CrL\M.
1 (J_CI, Tile \-1[~1n[rz 1l1iJ)' <lppe;;l :1111 11(I[ICC ur ~kLllllt tu 111e [31C[J'l Bc.~l[d of Dlrt:((ors
/,\:,11;,/"(',1 ':; /'(':'.'1.'.' /:, I I
/}),i:l/
./ I i,'(i,'-I,' '\ )", ;,'1, /-"/1"1/; ;\',I.'l,'(, .1,/./; (.'_'- (
i,'I' /eos(' i"lIne, Court .\'IIJl"':)(J. (l/ui 15Jcrp C/(I!m i\/II.tlh_'J/
Dcn,.
DICEI' DEFE;\SE ATI OR:\EY(S) REI'ORTfNC REQUIRE!\IENTS
Our Clty IS;) J1lc'll,bcJ" C'flhc Big Independent CItIes Excess P,Jol (BICEP), a \',Ovcnlll\cnLtl
".1, Illlt Po\\'crs" 11~h sh:l!ll1g p,")O!1!1;1t pro\'ldcs (:\l'CSS COVLT~JgC to ils member C!tIC:;. HICLP directly
CU'TfS lIS JTlcl11hcr c;tJCS, ~llld I11JY also purch~lsc commClCl:tl C\CCSS l1;ihllity JilS1l1~illCC or
rClllS!ILl1lCC ror them.
\V\. !1;lve pLlccd HICf- i' 011 notIce (1[ the rckrcnccd CLIll1l. rllC~lJ;lr!t to :1t:/c('rllcII1:.~ hl'l\\CCI1
UICEP ;11111 our CIly, BICEP will mOl1lt(l! lhe Cldl!1I ,1I1d lll;lY Llkc;m actl\'C rok III liveISeel!l!; tl1\.~
C];11Jil, IJtl~>dll)1l Jlld se1tlclllcnt Ilcgoi!tltiClns III C(H'p(:r~jllOn \\'Itll the Clly and you <IS its defense
;]lldrllcy(s) Dq1cnulll.:',Ollll1c all10unt n[potcllll:1] ddl1UgCS, Cnlllillc:'c]~d execs:; liability 1l1SlllCrS ur
Il~ilhlllL:l:-; J1~a;.' :lls() bl'd11llC 111\'U!\ cd
Und--:r the agreements h('[\',:t:l...'l1 I3JCLP Jnd the C]l~,:, )'(lU :nu;;t :ldherc 10 Ih'~ (nllo\\'lilg
lcportlr:g ~('qUll'Cl1h:IlIS. Your rcpnn~:, m;nk-cd "Cunfidel:\I:d i\1l01';lCY Client COrnnllI1l1Clliun,"
sho~lid be :lLldrcsscd 10 tIle C]:y \\-']111 U.)Pll'~~ In BIer;) and, If;\ppl\cdblc, COJnl1lcrcl:t! C:XCl'~:S ]Llbl1:ly
lJlSUrers or rCl1l,c;tlt'crs a1ld I1Wll11orll1g clHlrlscI
l'RU.l:vtlT<,\RY [V,\LU.\-; 10>1
Wlllllllllillet)' ('JII) Ja)'s of nul Ice 10 BICE!' urlhe ll"illl 01 OCClIlrCIICC, )'011I r,m1 Sklll
Sllbmit a letter to the City clptlUllcd "PrCll/TIJlll1ry L\'JllLitJOII" arid COnlJIIllng lhc J'olk')\\'j:Jg
JI\[onnation ullJt:r scpar:Jtc l11~;,.Hllllgs
. Bllcf DeSCription of Ihe CdSC [A ',CllIene," or short P'" d:;rdph "lIl du]
. !', Gecdur,,! f-ilstory
. Trial anJ Settlement ('ollfercncc [hies
. SL'tcll1cnt of relets
. /\pp!lC:lhle ImlllllI'ltics
. Clty'~ I iahdlly
. PlellIlllffs ('omp:1fatlvf F:nilt
~ Compar31ivc Lll1lt or O:l1cr LI;ihll~y Of'T!llld l\i:1ic~;
. 1!!(jcmllJ!ica(lull'Jr IIl:;lIr;\llCC l\vaiLlhlc from Other Pilrt]CS
. DJJl1;\gcs
. Llllg:illlJll Cost j',;timJIc
. Settlement !)crn;lJilLiOllr..:Is
I [<,C\'I<,l" [onn;]I!!) <ol'I.'<I'O)1,J to 1'\lh!l( J:: >]l'~'V
'" i,,, ll.-:
"'(I
.,
.
J:\:~::!.iJil):I ~i::d t\'cL"n:~illl,i. :!I-';:;~
ITl ::~;..\T)()\'; jll .\'\,' :\~<i) Lit 1J(-:! ;'
.'-\!nng \.\ Ill: IIJC Ph'hn: :1:\1"; .\.llt:.lliCl:. >( .:r ii:lll :;1:.111 \.~'JiliFk:,-: ;:rld rClr.:!!11hC ;!!i;;ci:,.'d
Illii~;II:G!1 Phn :lI1J 13ud~ct
St'\1 \lARlFS OF C()l:RT I'R(J(ILDI:\CS\ ::1) 1)1\( ()\] i( Y
Your linn ~hdlJ pro\HJC tl:L: CIty \\-llh [l111C]Y ]clkr rcp(,11::; uf C(~LIr! p:0cccdJng~~, dl'P0~i!lnlls
<1Jld \\Tlltcn discovery', These !cUe!':; sh:l!1 C(llll!1lCr:t nn the SI~l1lJi'::;j]Kt; ULIl1']' IlC\\'" dc\clnplllcrllS.
4 PRETRL\L EV,\LUATION
Vv'ltlJIIl SIxty (CIO) days of the (nil! d::le. and olle \\cck hefolc ;lIlY sClt1cll1cnl (l)n(crcncc, yuur
finn shllll p:O\'ldc Ihe \1Cl1lhel e,l)' \VIlli II Icller repOl1 clptlnr;ed "l'leIIlJllvlt!IIJllull" 111111 COI1[;11/1S
JIl :ljJLlJ!C Oil the IO!,llCS 110tCO JJl ScctlC'dl 1
5 SETTU::\1E"iT or ITRS ,\ND Dn.1A~;DS
YlJur (inn sh;;JI imlllC(,I!;J!cly CUmJlHltllclte all scll1cmclll (lclll:l1lds and orrcrs 10 rh,~ Clly,
13ICFI"5 Cencr," ~lal1l1l'LI, BI(TI"s CI11I/I1S AdI1I1/1"11.11!>r, 11l1d ."ItClll1ppliCllhle, C0I11I11<:ICII,1
CXCc:;S insurers a:H.! lllnlllr(nill~', cOlln~.;cl The !\.1clllhcr CIIV shiJl] !lOr l'nler 11110 <I SL:llk'llICill1h:rl
It__'qulles pa)-rrnCllt [rl)Ill13ICEP's pooled fllJHls wIthout BICEP's l:DJ1~;l'Jll
(I COPIES TO [{fCTP AN/) C'l;;\1:\lERCI:\L I:XCL~S lNSlY{Ll<S
YUllr IllIn sh,lIl dlfl'ei c'-'ples oflltc reports 111 Secllol1S I 11l1(lugh 5 10 lllCEr"s Celle.,II!
J\L'll:.lgcr ;l1ld BICEP's ('IJlfllS AdlllIllistrJIOr, <llld 10 dll'r' C:,{Cl'~:-; 111.';111Crs \\hose 1<l:\Trs uf CO\'Cr:l:.;l'
1:1(1)' he :1Jfcclcd hy a settlelllenl Uf .Judgment \\'l1CIJ requested, YOllr firm shall ;llso copy the rCjlurls
10 ill!V 1l1011ltonllL' i.J;lorllCV f(1[' nlCEP ;1J1U"Ll/' its excess i:1SlIi"l'l'S
~ ~ -
('opics 10 BICEI' ,1i01lU he di'l'clcd"5 foiluws
I} ICEe.J;f_I)!:.rI1!)\l"'2l1 O,lj'
C;rcgnry Splkef
Ken Spike! & AssociJIC,
1100 SOllill Flo\\'el Slreel, Suite 2100
L.os /\l1gclcc, C.\ ~(J(J 15
131([1' CIIlllllS_Ac!UlJ.Ill2'.lc"t'Jc
Crlllt: Scliwelkhll/d
Cregor; BrJ~'.g & Associates, J:1('.
I' 0 Box 3544
Veni"!.'!, C\ 030(J(j.3S44
These 81CEP represel1lal;\'cs 11111)' lequest )'oulo Ildd olhers 10 Ille CIICl,I"IIOI1 (,fyour
f':'por15
Th:lnk YOII fur your ,lttnlI. JC'!] tn lllL~ Jhovc.
Very truly Y()tlr~,
---------- ----,- ---. ------- -----,-
[IIIII:J
C \ -li'~ (I(i
21
B!CLP I I'~ 1(;.\Tl():'"~ l'L:\\ l\. nr:nCE'!
'I"
Cr:ll" SCI,WCIUW"
. ,~
Circ~;nry dLlg:; 8.: AS~;(l(:l<l!I'S. ilH'
I' 0_ Bux ~5':)4
Ventu"" ClI ~}000-35~4
Ca.q.; N;ll11C.
flleFI' Chin No :
------- ---- ~~------ - -- - -~-_._--~_._-_._-_._------_.._--._--
Ll\\' r nm
- - -----------_._--_.__..._-----_..._---------_.~--------. -- .----------------
FII'rll i\[[nrlll'~' __________._._____
- ------~------------- --- -----_.~- --.--.--------.-----.---... -.---.-
Pl10l1C'
:\ild, ,::s<..,'
-_._-- --~------ --- -------..----------- -----~---_._-------~-- -- --- --.--.--- .---------..-----
- ----- ------- ----- - --- ---~ - - -- --------------- - ------ -- -- ----
I ),lll];I.'~.CS E.\p();,urc:.._______._
(',lSl' SUIllJll:lrY_..__m__.~,"_
----- ----- ---- --.-- --.-.-----...- -_._- -- -.-.-- --_._--~. --.---.-.---- -------- --- -.-.-.-- ------------
FfTS /\NLJ COSTS TO DATE
:\ltnrilCY Fees III D.\tc:
,.
~
C0.-;L~ tu dJ!c'
'j,
II
PRU)I:SCOVFRY (/(1':"111/,. u!ld h'/lIl1der roc/' /,,'ildlll,l:)
r~_l~_l~.QJ5'~L..G"c~
C.]~-,c Fv:JlllJ!lOJliTr'~')ll1lir1:lry RC::;C~HLh
Esllm I.rs___~__G'o_____......._..._hollr
$
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72
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r: ~ : , : ; 1 i; I ~;
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:11 L)]',C"':\Ll-~Yl.U\::tl:_,;::~~j'" .r~l'rc..l~l,l):,\,il,,':)
C J ()~-, .11(,
/\ ..
l-;lrt 111\-C'::-;lg:.III\)!l
-_._--_._----_.__._._._._----_..~-- -------------.-----.--
----- -------_..__.._--,.__.-------~-----------
E~.itl\ll.. he:;
________(!!.__ ___ ________llo\\r
H \\'tl:1CSS flltC'f\-'ICW::>
-.----------.-.----- ------~ --.----.-.-- -----.-.----------------------
Lsllm. );r~;
(Ii hOtll
._-----'-,,/_-----~._--
c
\\'l1ncs:; P1Cp:i~.<\IIOn fur f)cpn-;tillOll
f'sl!m Ills
0~.______hour
___'___U___ ._____.,_________. -.---------.---
D
LI1-.IIIg [)cro~;i! 10ilS_________
__"__' __________~__~______ ___u._____ .___ _____ ______""______________.. -~-.-----
EslllIl 1115___ .____@_.
hOll!
E
Defcndlng DcpositiollS._______
------------ --------_._-~~- ------.---
[:,ti:n ]lrs._________~r!1J________110tlr
]:, Drafting Dlscovcry'_._______________________.. _.________
_.~._---------------------------~-----------_.-
f:~S:il11 Ilrs __________(~)___.________11our
2,
1"'1
..10'-
! \-'_"_'.0.;
s_ ________ ____
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h'~\:1
E~:ilI111 hr~;
__________({~)___~_.___ __~___11'.}ll [
IV !\lOTIONS (l(knllfy ;md list tinder cacli he;lllll1<;)
()}-(i:,.(j(,
/\ PruLcdur;ll-
Fslim Ins_~ _ ___..__.__(i,
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D i scu \.. LfY: _ __,,______. ._._~_ ____.__.
[slim hIs.
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SlJlll111;lry .I Ud~1,1l1CI11._____________
fC'illlll IllS
((Ii
II. III I.n11I1I<"
hour
hour
hour
["I;1ll hrs
~II hO\lf
ro. Olher
E:.;ti 111. llrs. ____.._______ ___ _ (c/,I __ '_________
2.)
hour
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L:.i\8,L1TY PROGRt,:.1
BIG li'JCEFEt'iDE-IH C'IIES EXCESS PCOL ([',ICEP)
3elf-lnsured Retention'
Program Year
The Member, , hereby agrees to enter rnto and participate in the
Program of Coverage ('Pr(;gram") as stated herein in accordance with the terms and
conditions as follows
ARTICLE I
DEFINITIONS
The definitions of terms used in this Program shall be the same as tl10se contained in
the Joint Powers Authority Agreement ("JPA") and the Bylaws of Big Independent Cities
Excess Pool ("BICEP"), unless otherwrse expressly provided herein
1.1 'Actuary" means a frrm with at least one employee who is both a Fellow of the
Casualty Actuarial Society and a Member of the Amerrcan Academy of Actuaries, WhlCl1
firm is appointed by BICEP with the approval of at least a majority of the Goard
1 2 "Administrative Premium" means each Member's proportion of all administrative
costs of BICEP including, but not limited to, fees of any accountants, Actuary, ,lttorneys,
Claims Auditor, financial auditors, general management, investments services, trustee
serVices, and all other necessary administrative costs of BICEP or charges required to
be paid by it in order to administer BICEP, as fu:1her set for1h in Sectiorl 4.1 2.1 hereof
13 "Case Reserves" means amounts in the Claims Payment Fund required to be
designated as reserves for payment of Settlements pursuant to Article III hereof in
accordance with prudent claims practice and the recommendations in the Claims
Auditor's annual report. Case Reserves will be adjusted to reflect any changed
circumstances subsequent to the year any Claim is fried and to reflect the amount by
which a Settlement exceeds or is less than reserves established for any Claim,
provided, however, that there shall be no Case Reserves established for a Claim or any
portion thereof within a Member's Self-Insured Retention or which is covered by
Insurance pursuant to Section 2.1.1 hereof.
1.4 "Claim(s)" means a demand(s) against a Member to recover for losses or
damages wrthln or alleged to be wllhrn the scope of Coverage rn accordance With
Section 2 1 below
I HI'llll\' I'rligram
(J5-)] 06
.1-
1.5 "Clalills Auditor" illeans an Individual or an organization expenenced In the
handling of public entity liability Claims, appolfltcd llY 81CEP with tile appro'Jal of a
maJonty of the Board who shall be Independent of any part)' who acifllinisters CI~lIns on
behalf of BICEP or its members
1.6 "Claims Payment Fund" means the fund established for the payment of
Settlements pursuant to Section 32 hereof. Nothing in this Program is Intended to
prohibit BICEP from designating the Claims PJyment Fund as bClI1g compnsed of
separate accounts for the purposes of issuing and securing funding
1.7 "Coverage Period" means each year coextensive with the Memorandum Period
(as set forth in Section II, ~laragraph 20 of the Memorandum) for which a Member PZ-iys
Participation Premium
18 "Experience Percent Contnbutlon" means each Member's percentages set fOlth
In the BICEP Expelience Rating Study performed by BICEP's Actuary In e3ch year
prior to the next Coverage Penod uSing the methodology set 101111 III the LrClbfllty Rating
Plan, attached hereto as Exhibit /\ 11'1 thiS Program
1 9 "Partlcipiltion Premium" means with respect to each Member, the sum of the
I\dministrative Premium, Risk SilcHing Premium and Insurance F'r8mIIJITI, due and
payable by each Member on each Premium Payment Date a,; dcleil1llned III
accordance with Al1lcle IV hereof.
1 10 "Payroll" means with ree,pect to a Member, the workers' compensation payroll of
such Member 3S reported to the State of California or If a Member is not dOnllclled 111
California, as reqUired to be reported In the other state
1.11 "Participation Premium Adjustment" means the actual accounting of revenue and
expenses and all Claims, including incurred but not reported (IBNR), for each Coverage
Penod that occurred on or after July 1, 2004 versus the amounts deposited for each
Coverage Period commencfllg July 1, 2004 and tllereafter, in accordance with the
Liability Rating Plan
1.12 "Pure Premium Adjustment" means the annual adjustment on all risk-sllared
Claims that occurred from October 1, 1988 (fflceptlcm date of BICEP) up to July 1, 2LJ04.
1,13 "Retained Earnings" shall be that as identified in the audited annual fflliwclal
statements of BICEP.
1.14 "Reverse Following Form" means suspending the terms and conditions of the
Mell10randum and replacing them with terms and conditions of the poliCY of Insurance,
or with the terillS and conditions of Clnother public agency's memorandum of cO'Jerage.
1,1.11',[,:\ l'riWrlll1
o ~ -,I 1(16
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1.15 "Plsk Si"larlng Premium" m8ans trle "mount necessary to f~nd expected lossc~s
required to be established to pay Setth':ments of the Members for a Cover.lje Penod as
dstermlned in accordance willi the Liability Rating Plan.
1 16 "Risk Sharing Layer' means a specific layer of coverage pcr occurrence
applicable to one or more Members BICEP may establish one or mcre levels of self-
insurcd retcntion in compliance with Section 2 1 hereof as <lpproved by the Boa~d
annually
1.17 "Settlement(s)" means the settlement by BICEP or a Member, ill accordance wilh
Insurance III effect or the Memor<ll1dum, of a Claim against such Member, or the final
adjudication of such Claim. TIle amount of any Settlement may Include any costs or
expenses deemed appropriate by BICEP in connection therewith including DEFENSE
COSTS as described In tile Memorandum or as covered by Insurance.
1.18 "Supplemental Premium" means the amount new Members must deposit with
BICEP if the new Member will participate in BICEP's Retained Earnings on 311 equal
footing with Charter r'Jlerr:bers
1 19 "Terminated Member" me<lns a Member permitted to withdr<lw from Coverage
pursuant to Article VII of the 8y!aws or <l Member expelled pursuant to Artlclo VIII of the
Bylaws
AR lICLE II
COVERAGE PROGRAMS
2 1 Ccvf'rage.
III accordance with Article V of the Bylaws, BICEP horeby plUvidcs illld the
Member hereby accepts the Coverage and shall partiCipate In the Risk Sharrng L<lyer as
set forth In the Declaration for each year's Coverage Period.
2 1.1 BICEP may prOVide Coverage, or a portion of Coverage, to the Members
by purchase of insurance ("Insurance") from a commercial insurer or reinsurer, upon the
approval of the Board BICEP shall be obligated to assist and cooperate with eal~ll
Member ill collecting for covered Claims from such insurers to the fuliest extent
2.1 2 BICEP shall pay any covered Claims ill each Coverage Period In
accordance with the Memorandum However, prior to each Coveraqe Period, BICEP
may also determine whether or not to suspend the Memorandum and to apflrove and
Clccept a Reverse Following Form as the basis for liability coverage of Claims
2 1.3 Notwithstand,ng ilny recoveries through reinoUr.3llCe or !llsur;]!lCC, ill r;o
Li.1h,llI\' Pn'I',1<l1n
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E:Vellt shell OI::::EP be obliJ8!f;d to pJY any covered Cic-lin in excess of the n:;jX:rriLW:l
arrlount of $ ~ 0 rn:!iicn p8r o.-::;currC:lce or S~5 rnJ1iJon annual aSJreg~~te f()r 2!i CbH iiS
:,fHICI_E III
rAYIv1CNT Ur: CLAIM,~
3 1 Case Reserves
BICEP shall retain a Claims Auditor for the purpose of submitting an annual
report to BICEP setting forth (a) the amount of Case Reserves necessary to be
established Wlnl respect to each Claim arising dunng the precedlllg full Coverage
Period and a breakdown of the amount of Case Reserves applicable to each Rrsk
Sharing Pool, and (b) any adjustments (whether upward or downward) necessary to be
made in the amount of each Case Reserve previously establishc,-j pursuant to this
Section.
32 iJayment of Settlements.
BICEP shall establish a Claims Payment Fund for the payment of Settlemon!-;
Settlements shall be paid upon submiSSion to BICEP In accordance with the proceclure~;
of the Liability Risk Management Requirements, attached as Exhibit A to tl18
Memorandum, and IIlcorporated herein by reference, as approved and adopted by the
Board,
3 3 Structuring Settlernents.
Each Member hereby covenants to cooperate with BICEP in the settlement
and/or litigation of CI31r11s in excess of the Member's Self-I:lsurcd Retention 10 the
extent such Member has control over any negotiation or structuring of a Settlement and
subject to the limitations as determllled by GICEP In accordance Wlt!1 Section 2 '1.2 ,
above, each Member shall not allow Settlement payment dates earlier than the date the
Claims Payment r:und has been or Will be fully funded to COver Case Reserves
established for tile payment of such Claim With respect to any judgment (os defined In
California Government Code Section 970 or in accordance with the laws applicable to
any out-of-state member) in an amount which exceeds such Member's Self. Insured
Retention, each Member shall petition the court for payment of slJch Judgment rn
instaliments pursuant to the provisions of California Government Code SectiOn 9706 or
in accordance With the laws applicable to any out-of-state member upon request by
8lCEP after conSideration by the BICEP Board of its Target Retained Earnings Policy
StatelTlent attached ldicreto as ExhiLit B arid incorporated herein by reference.
!.1;lhdllV l'fl'gl']iH
O~.3 I -{:'(1
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)\1, I:CU:: IV
PF~[fviiUrv1S
4 1 Member's Premium Costs
4 1.1 Appropriation of Premium Payments Each Member shall take such acllon
as may be necessary to Include Participation Premium payments payable hereunder In
Its annual agency budget and to make the necessary annuai appropriations for all such
payments to BICEP. The obligations on the part of each Member herem contained shilll
be deemed to be and shall be construed to be duties imposed by law and it shall be the
duty of each and evelY publiC offiCial of each Member to take such actlol1 and do such
things as are required by law in the performance of the official duty of such officials to
enable each Member to carry out and perform Its obligations Ilerein.
4.1.2 The Participation Premium payments are made in consideration for
Coverage for each Coverage Period The entlle amount of PartiCipation Premium IS due
on the Premium Payment Date, which shall be August 1 of each Fiscal Year which is
coextensive With the applicable Coverage Period The deterrTllnatlon of the amount of
the j)artlcipation Premium payable for such Coverage Pellod by each Member shall be
made as soon as reasonably possible but no later than the day before tile renewal date
preceding the next Covel age Penod. Each Member shall be obligated to pay the
Participation Premium, which is determined as follows
4. '1.2 1 Administrative Premium. Each Member shdll pay to BICEP
an Administrative Premium The method for charging Administrative Premium may be
to apply the Experience Percent Contribution set fmth in the Liability Ratlllg Plan,
Exhibit A, or to diVide all administrative costs equally between the Men;bers, as annuaily
determined by the Board.
4.1 2.2 Risk Sharing Prernlum. Each Member shalf be respollslble
for its proportion of the Risk Sllaring Premium, as calculated in the Liability Rating Plan,
Exhibit A. The Risk Sharing Premium shall be calculated In the following manner With
respect to each Coverage Period, BICEP shall determine the total of the Risk Sharing
Premium by retainillg all Actuary to prepare a report to be delivered to BICEP preceding
the beginning of such Coverage Period which recommends the amount of funds to be
deposited in the Claims Payment Fund such that the deposit, along with anticipated
investment Income, equals the expected value of all pooled losses, plus any margin fOI
contingency the Board may determine appropriate for the Risk Sharing Layer retail led
by BICEP for said Coverage Period
In no event will Risk Sharing Premium be paY3ble to establish Case
Reserves for Coverage in excess uf $10 illii:IUI1 per occurrence unless tile Goard raises
the limit above $10 miliion pel cccurlence
i.I,lhllltv I'rogrillll
I]~, - 3 l -06
-)-
4 1.2 3 Insurance Premium. In 3 Coverage Period ~or which
BIC[r~ h3s purchased Ir,surance CI: behalf of eacl1 Member, eacl1 such Member shaH
be obligated to pay its pi oportion of ti,e costs of such Insura,'1Ce In accordance wilh the
Experience Percent Contnbutlon under the Liability Rating [')131'1, 111 lieu ()f GIll or a portion
of RISK Sharing Plemlum, In addition to the olhel components of P3rtlclpatlon F'remlum
4.1.2.4 Supplemental Premil;m In the sole discretion of each
Member, 3 Member may pay to BICE::P a Supplemental Premium that shall be applied
and credited to that Member's portion of Relalned Earnings
4.1.3 Adjustments to Pal1iclp3110n f)remium The PartiCipation Plemium may
be adjusted as follows
4131
after July 1, 2005, the
Premium AdJustrner,t.
Participation Premium Adjustment Annually beginning
P3rtlclpatlon Premium may be adjusted by a PartiCipation
BICEP shall give prompt wntten notice to each Member cf the
determination of such adjustment. If assessed due to a defiCit in a prior Coverage
Period, each Member shall be obligated to pay the full amount of the assessment on the
Premium Payment Date; unless, at the discretion of the Board, each Member IS <Jllowed
to pay a portion of the assessment prorated up to five (5) years as authOrized by the
Board In the event of an excess in payment in any Coverage Period, each Member
shall be credited Its proportion of such excess payment In accordance with Exhibit A
Liability Ratrng Plan and attachments thereto, which shall be hel<:1 by BICEP as
r~etalned Earnings until released In accordance With the provisions of thiS ProgrcolTl
4 1.32 Pure Premium .I\djustment ^ Pure Premium Adjustment
shall be applied to the Participation Premium as applicable to Claims of each Member
11131 occurred dUllng the period from October 1, 1988 up to July 1, 2004. The amount of
the Pure Premium Adlustment shall be calculated In accordance with the liability Risk
Coverage Agreement, dated as of October 1, 1988, which shall remain In force and
effect for such calculation Said Liability Risk Coverage Agreement shall automatically
expire upon the event that all such Claims have been fu!ly satisfied Such Pure
Premium Adjustment shall be detCliled and included In each Member's renewal invoice
4.14. Use of Retained Earnings The Board may, but is not obligated to,
authorize the release of Retained Earnings as a dividend to be applied to the
Participation Premium of a Member or to be paid to a Member, upon consideration of
the Target Retained Earnings PoliCY Statement (Exhibit B)
42 Tennin;::tled rl/Jei-rI!J(::,(S FJrl3flliun) Costs
4.2.1. [ach Terminated Member shall take slIch action ;JS may be nr,cessary to
1,':\bllliV l'IOL'.I:II11
(r".ll.(){)
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include Termination PreinlUIn payme"ts payable hereunder in ,ts annuai ag"ney bU':r;st
and to make the necessary annual appropriations for 011 ~,uch payn,ents to 8iCU' H.e
obligations on the part of each Terminated Member herem con tamed shall be deenwd
to be and shall be construed to be duties Imposed by law and It shal! be the dut'( of
each and evelY public official of eacll Terminated Member to take sueh acbn and do
such things as are reqUired by law In the performance of the offiCial duty of such offiCials
to enable eacll Terminated Member to carry out and perfolm Its obligations herein ThiS
obligation may not be Imposed in any given year that a Terminated Member's account
exceeds their charges for adjustments and allocations, depending on the condition of
the Claims Payment Fund and the Board's determination whether to release any
Retained Earnings after consideration of the Target Retained Earnings Policy Statement
(Exhibit B)
42.2. Termination Premium A Termmated Member shall pay a Termination
Premium which is comprised of atl costs, Including but not limited to, any admirllstratlve
costs and any adjustments applicable pursuant to Section 4.13 of thiS Program, for any
Coverage Period in which the Terminated Member was an active Member of BICEP
4.23 Determination of a Member's Retained Earnings Upon Withdraw;;1 or
Expulsion. In connection with permitting Withdrawal of a Member from Covera~Je
pursuant to Article VII of the Bylaws or expelling a Member pursuant to Article VIII of th~
Bylaws, a portion of Retarned Earnings shall at such tWlle be allocated to the
Terminated Member in accordance With the most recent annual audited flllanclal
statement of BICEP available as of the effective date of the Temllnated Members
withdrawal or expulsion. The sum of such amoullts allocated to such Terminated
Member shall be applied fllst to tile payment of TefITlIrlation Premium pursuant to
Section 4 2 2.
4.24. After credit to pay the Termination Premium and all other obligations due
from such Terminated Member under the terms of thiS Program and any Interest
thereon, BICEP shall hold the remaining balance of the Terminated Member's I~etalrled
Earnrngs ("Remaining Assets") due to the Terminated Member, if any, III a segregated
account BICEP wilt transfer to a Terminated Member its Remaining Assets on the
earliest plactlcable date when such Member rs no longer subject to the payment of a
Termination Premium under the terms of this Program ie, when all Clallns Within the
scope of Coverage prior to withdrawal or expulsion of such Member have been fmally
determined and/or paid as Settlements, unless the Board upon conSideration of its
Target Retained Earnings Policy Statement (Exhibit B) determines that release of the
Remaining Assets will substantially affect the financial condition of BICEP. If there are
insufficient Remaining Assets to meet the Terminated Member's continuing cbi:gc;tions
to BICEP, the Terminated Member shall be obligated to pay any sllch deficit amount
4.2 5 Tile release of Retained Earnings to each Mernber upon the dissolution of
BICEP pursuiJnt to Article VI of the Bylaws shall be hzmell'cd In ,'ubstcliltially tl18 same
: LliJdllY Plq;r;llll
05.JJ.()()
"
-,-
rnailnef uS herelfl<.llJove pro\/Icie\...i in this Section 4 ~
4 3 Common Prenllurn Provlslon~; to r.,1embers and Terminated r,,'1embcI5
4 3 1 l..Jo Withholding l..Jotwlthstandlllq any dispute between GiCEP alld a
Member or Terml'lated Member, including a dispute as to the scope or nature of
Coverage provided by BICEP or the availability of amounts In the Claims Poyment Fund
to pay Claims made against any Member or ;-ermlnated Member, or for any oHler
reason (other than the termination of the obligation to pay Pal11clpation Premium
pursuant to Section 4.2 4 hereof) each Member including Termmated Member shall
appropriate funds suffiCient to pay and shall make ail Participation Premium payments
including Pure Premium Adjustments, and Participation Premium Adjustments for
Members or Terminated Members when due and shall not 'Nlthhold any such payments
pending the fmal resolution of such dispute
432. Payment of InVOices BICEP Invoices are to LIe paid Within 30 day:; of
presentation to Members unless anolller due dJte IS speCified on trle Invoice
4.3 3 I~ate on Overdue Payments In the event a Member or Terminated
Member fads to make any of the payments reqUired In this Article, the payment in
default shall continue as an obligation of the Member or Termlllated Member until the
amount in default shall have been fully paid, and In addition to any remedies available
with respect to such default, the Member or Terminated Member aglees to pay the
same With Interest thereon Interest shall be calculated uSing f3ICEP's 3Vera(Je
earnings rate as determined in the latest 12'lTIonth Investment Performance Portfolio
prepared by BICEP's investment managers, but not to exceed the hlDhest rate
permitted by law, from the date such amount was oriDlnaliy payable. ThiS prOVISion call
be waived by the Board on a case-by-case baSIS.
4 34 Damages; Revocation of Withdrawal In no event shall withdrawal frolll
Coverage release a Member from its obligation to pay damages resulting from default
under the terms of tillS Program which is not remedied by payment of Terminalion
Premium or from its obligation to pay Pure Premium Adjustments and Participation
Premium Adjustments With respect to Claims within the scope of Coverage prior to such
withdrawal BICEY shall continue to pay Settlement of Claims relatlllg to the withdrawn
Member within the scope of Coverage prior to Withdrawal as provided herein, unless tlte
Member defaults in the payment of ItS continuing obligations descnbed herein
4.3.5 Member's Rights Upon Dissolution of BICEP. in the event of the
dissolution of BICEP in accordance With Article VI of the Bylaws, the terms and
conditions of this Liability Program shall remain in full force and effect untt! such time as
all Claims within the scope of Coverage have been finally determined and/or paid as
Settlements Remaining Assets (as defined in Section 4 24, above) shall be dlstnl:>uted
consistent \Nith Section 4 2.4
L-I"hilt~ rrn~r.lfTl
W,.J].1j6
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.
IN 'NITNI::SS WHERI::Cfo, the undersigned Memher iJc~nowfedges reading, fui:y
understanding amJ 3cceptlng the terms and proVISions of t1w F'roglam
Date
By ________~~
Pllnt Name____________
City of _____________c____________
1,)hl!llv PI;)f!.;:l1ll
05.-' j .00
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.
Exhibit A
Big li;d0i),~ndei1t Cities Excess F'rcg.am (BICEP)
Liability Rati:1g Plan
I. Participation Premium
ror CJch Coverage Period, beginning July 1, 200~, a PJrilci:latioll Premium sh;1l1 h:
calculated for each melllhcr. Thc Members' Palllcipatioll PrCll1lUm shall be ",rtiClenl to
pay the Mcmbers' ],isK Shanng Prcmiull1, Insurance Prcmiull1 and Ad,ninistr"t".c
Premiull1, The process for calculating each Members' share or these three Premil"'" IS
set rorth in AppendiX ,\-1, Exhibits C\-I through CA-9, inclusive. and as more
SpC\..:J flcally set forth below.
^ Risk Sharing Premium. A:i st"ted III 1 ahoH. each ~;klllhcr's I,d.;
Sharing Premium shall he based on the f{1Ilo\','ing data for the three Yl'~ns
beginning fUilr years prior to the CUVLTJgC PCflud 1'01' \\111ch ?articlp;-itioll
Prcl1llu!l1~; dl'~~ hem}; cdctllatcd'
1. Reported il-ICU1TCd lossc:;. These ;1rc lo\s p;lymcllls rdl1s rCSCI\'I..::; lut
incurred but unpclld C Lll illS, ~s est"bllshed lJ)' LJICTP's c!:lil:I';
;tJmll11strator Only liability c!J.ims or the tYilC C(l\,CICJ by tlJl:
i\h:IT10t;llHlu1l1 l)1" in ~l(i..:lJrd~lllCC \Vlt!1 SCclJl}11 2.1..2 sktll h~
cOIl:dckrcd.
! ~~umbi.:r uCrcrortcd iJl~:lilT..:d cl:.1ims cxccc:diil~ 5;:250,O()O.
). \VOl Kcr:; clllllpensatlClll payroll, as rcp'Jrkd to the Sl.lte ,.,1'
C~..dJl~_Hl1i~l ur llny other 5}tak it- a I1lclllbcl IS dll1l11~~ikd ill ZHl(\tlL.:r
SIlk
The above three amOlllllS shall he lIscJ to cornrutc <111 eXIJCllcncc
moJificHion fc1r:tor (XlTlud) 1'01 CJ:::h I\'knlbcr ((If t;lC UI'COl1lillg CO\'Cr;.tgc
PClJOJ.
Each tvkl1lbel 's share of the Risk Shdring Premiul1l :;h.di be the pruduct "I'
its.
XJ1v'd, multiplied hy its
')
\Vorkcrs cC>JrtpcJl'~;Jli()1l payroll for t\:c year fur \vhich I\lrti(:il~;LtlC'Hl
rrcmiut11s ~re being c3lculatcd, IllLrltir,licd by
1,~.~ll:( ,\,,"' h',', .'.1,lrUfT,,.,,,ill,t'T'.F,,,,;III)([ I' l._h.l"IA r,16(]~IY, fl 'Ji"I,!\ f',(;j.1Jln)p I:) ('(die" .11) d"l
,\-\
3. The los~~ LllC' cl:cuLttcd hy BICrp's ~\(.:lU'ifY ~m,l ;1" al~('pT.l\j 1-')
BIC[P rilr the Fisk Sh:!:';ng La)c:(s) ln IILich the \lcrllbcr \'.ill
pdrtlt:rpatc The H1Cl:"!.) D,.)~HJ 111l) elect to include ;m ~d\Jili\)!l to
RCl:lin-:d Earnw~,s in th~ k,.";s r~ltI.J<).
B. Insurance Premium. Lcdl "!cl"lrel"; II1S"':III(C Premiull1 shail he
calculated as the !'r\JJuct or ib Lxperience Percent ContllhutitHlll1ulrlplicd
II)' Lhc total premium to be p:lid by BICL-:P f(ir 111:.;uranCl: fur lhe UpCOllll!lg
progranl )T:\l
C. Administrative Premium. ['aeh ~lcmher's i\dll1inislrati\'e Premium
shall be calculated as the prllduL'l of it,; I:xl,erience Percent Contnbulion
multiplied hy Lhe total amour:t of ;\dl11in"tJ:Jli,,; Premium rCljuired by
[HeEl' for the upc(lll1ing program year.
II. Participation Premium Adjustment
f-ollowing the clo:,e of each ('o\'cra:;e Period, an :,dlustnh;nt shall be ll1ade to Ihe
ParliCl;13ll01l PrCI111UI11, as c.L.:scrihcu 1\1 ! above. paid hy c:h.:h i\'kmber The ad.ill:-i\1l1'-':l1t to
each cumponent or the P,uticipatlon !'reliliuill sit,dl he cJlculJlnl il~; set 1,'rtL hel\)\\,
A Risk Sharing Premium. 1:,1\:h 1\1cmbcr's sl1:ne ofthc tutal Ri~rk Shdl'iJ:g
Premium paid by all Members for the Co\'erage Period shall be calculald
The pcreclltilge so delcrmmed shall be mulllplic\1 by total losses in all Risk
Sharing Layers in whlch a t-.lemkr partiCipates to determine each
Member's actual share olthe Risk Sharing Premiums Total losses shall
include al11O!lI1ts p:Clid, ca~e rcscr\'cs .1lld lllclirrcd hut !lot repolLed Insscs
The I3ICL!' lJoard may elect to illClucle an addition tli or r.lcktlOIl from
Retained LJfllings.
B
Administrative Premium. Eacil Member's shJre
administrative CJlsls shall be its Expel ienee Percent
multiplied by (ol:t1 "drllJlllslr:l:ivc ClOsLS for the year.
oj' actu,d
ContrillUliull
C Insurance Premium. Each )vlcmber's share of actual i,nlranu;
prCmilllTIS shall be Its Expcllcncc Percent Conlflbutlon rJlultlplil.'d b~/ tlJl~d
il1~~L1r~lJ1Cl~ premiums for tile year.
r \t\111 I l{j.\t.:'.R"h M"",'~Cl]o~,,!',l)"C~I,\r;n.,1 nlCTi' .r>i'll'ol1\ lJ6(1)(\\ (11,11-,1", I',Pt",.,,)(.1 ](lro(,)(I,,,,,,) ,be
/\.2
.
L'.ll'l1 \1cmbi.'I'":', PJnj~:;p;t!I');'i Pl,-'CL:,,;:11 .;\l:.iU:,tllJ:,:I1[ ((,{' L'i.li.:l1 CO\:..'lai;L i\:rit_1J ~\h;1I1 h,..:
:\ The il.1:-tiupa[IUll P1C~11iul'n P~1Id;Jt the bq;1l1I11!lg u(thr~ YCdJ', k\.s
13. The f\lcrnbcl's :;h:!re ,)1- Ri:;k Sha!lng Premium, Adminiqratl\'c P1CilllUl11
and In:;uriill<:~ PremIum, dS calcubled III ScctlUlI II, Items A, Il "i',d C
abovc,
The process for calculating I'dcmber Participation Plemium Adjustments is set j()lIh ill
Appendix ,\-1, Fxhlbih LQ.! and EQ-2
A Participation Premium Adjustment for each Covcrage Period shall be calculate,1
I g months following the close of the Co\eragc Perind and al iJlU1Ual ;lItcrvalo thcrcClCtl':
untll all cJallns ill the lZisk Shilling l.ayer arc closed
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Exhibit B
BICEP
Liability Program
Target i'{etaincd Earnings Policy St<::tement
1. PURPOSE The purpose of this policy statement is to give guidance to the Board in
making annual funding decisions for the Liability Program By adoption of thiS policy
statement, the Board of Directors acknowledges that the long-term financial strength
of the Liability Program is of utmost Importance There IS a high degree of
unceliainty in actuarial estimates due to the possibility of occasional catastrophic
claims and inconsistent or inaccurate case reserving; therefore, the Board of
Directors desires to fund the Program In a cautious and prudent manner and returil
dividends to its members in an equally cautious and prudent manner.
2. TARGET RETAINED EARNINGS. BICEP has determined that the target retained
earnings goal for the Liability Program IS tile actuarially determined 85% confidence
level discounted for Investment income, subject to the following ratios.
Participation Premium to Retained Earnings ratio:
ThiS ratio is a measure of how Retained Earnings
possible pricing inaccuracies A low ratio IS desirable.
Target = 1.5:1
IS leveraged against
BICEP Retention to Retained Earnings ratio: Target = 0.5:1
This ratio is a measure of the maximum amount that Retained Earnings
could decline due to a single loss A low ratio IS desirable
Outstanding Reserves to Retained Earnings ratio: Target = 1.5:1
This ratio is a measure of how Retained Earnings is leveraged agiJinst
possible reserve inaccuracies. A low ratio is desirable.
. Retained Earnings is the amount shown as Retained Earnings In BICEF"s most
recent financial audit.
. Participation Premium includes the Risk Sharing Premium and
reinsurance/excess Insurance premium but does not Include administrative costs
. BICEP Retention is the maximum amount of exposure to a single loss ret3ined
by BICEP over the Inost rerc,nt 10 years
l.l,II1I1:I\' l'rop::11l OJ ~ I-Ot;
-B-1 -
.
.
. Outstandmg Reserves are the surn 1Gt31 of unra:d case reserves. cHl...i lnr.:urrc(]
but not repolied claims, In the R.sk Sharlllg Loyer as deteifTlinecJ by the C:alfi1;
Auditor and Actuary
3. ANNUAL ACTUARIAL STUDio BICEP will conduct an annual actuarial analYSIS to ass,'st
the Board of Dllectors in rnakl11g fundln;) deciSions on a prospective and
retrospective basIs
4 ApPLICATION OF TARGET SURPLUS CRITERIA, After annu31 review of the target
retained earnings ratiOS, the Board of Directors will be able to determine whether It IS
desirable to increase, decrease, or stabilize retained earnings if the Board deSires
to decrease retained earnings, it may approve a funding level below the 85%
confidence level Conversely, a funding decision above the 85% confidence level
will Indicate a bias toward increaSing retained earnings. A determination to fund <Jt
the 85% confidence level Will reilect the Goard's deSire to keep retained eJlIllngs at
the current level.
5 RETROSPECTIVE DIVIDENDS. DIvidends may be avai'able four (4) years from ti:e; end
of a Coverage Period The Board of Directors, uSing the target retained earnll"[js
ratios as a guide, may declare addiltonal retrospective dividends at any time
6 PROSPECTIVE DiVIDEND. To the extent the Board approves funding a new year at a
confidence level less than the target 85%, the Board recognizes the dlfierence
between actual funding and the 85% confidence level as a prospective (up frord)
dividend
7
AMENDMENT. This policy statement, amended bv the Board dated
shall be reviewed al1nually and reaffirmed or modified accordingly.
200G,
LI<lbllll) rl11gr0111l 01-21-0()
.-B-:'-
.
\N:Jf~KEF\S' cor.1PENSf,TiON PROGRAf.1
8iC 1!";OEP[~'m[NT CITIES EXCESS POOL \81Ca )
SE,lf-lnsl'red Retention
Prograrn Year
The Member, ____, hereby agrees to enter into and participate In the
INorkers' Compensation Program of Coverage ("Program") as st3ted herelll in
accordance with the terms and conditions as follows
ARTICLE I
DEFINITIONS
The definitions of terms used in this Program shall be the same as those contdlll8d in
the Joint Powers Authority Agreement ("JPA") and the Bylaws of Big Independent Cities
Excess Pool ("BICEP"), unless otherwise expressly provided herein
1.1 "Administrative Premium" means each Member's proportion of 811 admlllistratlve
costs of l3ICEP relating to the Program, as further set forth In Section 4 1 2 1 hereof
12 "Allocated Costs" means those costs of the Program which are specifically
related to a Member.
1.3 "Clalm(s)" means a demand(s) against a Member to recover for losses or
damages Within or alleged to be Within the scope of the PrOWClnl
1.4 "Coverage Period" means each year coextensive with the Fiscal Year (as defined
In the Bylaws) for which a Member pays Participation Premium, unless and as amended
by the Board.
1.5 "Insurance" means providing coverage for Claims in excess of a Member's Self-
Insured Retention amount by commercial Insurance or reinsurance.
16 "Palilcipation Premium" means with respect to each Member, 1he Administrative
Premium, If any, and estimated Insurance Premium payable by each Member on each
Premium Payment Date as determined in accordance with Alilcle IIf hereof.
1 7 "Settlement(s)" means the settlement by a Member and/or insurer, in accordance
With the Program, of a Claim against such Ulembcf, or the final adJudic3tlon of SUC:l
Claim.
\\'(llJ.d~r~' C{)mp'~f\S;I!I()I] Pr('g.I;lln
()) 21.()()
-I.
.
Ar~TtCLE !I
COVERAGE PROGRAMS
2 1 Coverage
In accordance with /l.rtlcle V of the Bylaws, BICEP hereby provides and Member
hereby accepts workers' compensation coverage ("Coverage") as set fOlih in the
Declaration for each year's Coverage ['eriod
21 1 Upon the approval of the Board, BICEP shall provide In~urance which IS in
excess of the Self-Insured r~etention as determined by the Member. -I he usual method
of funding will be to have each Member deposit their portion of premium for Insurance
purchased at the beginning of each Fiscal Year as a component part of their
PartiCipation ['remlulll
2 1 2 Insurance provided lor BICEP to its Members for Coverage, or any portion
thereof, shall be primary to pay any covered Claims. BICEP shall be obligated to assist
and cooperate with each Member in collecting for covered CliJims from such Irlsurers to
the fullest extent
2.1.3 BICEP shall not be obligated to pay any covelcel CI3im
/\RTfCU=: III
PAYMEN 1- OF CLAIMS
31 Settlements.
31.1 Each Membol shall retain the ,'ight to approve 01 reject 3 C13111'1 where the
settlement amount is less than their Se!f.lnsured Retention.
3.1.2 Each Member shail have the authority and responsibility for all !egal costs
for defense of a Claim that does not Invoive the insurance carr:er(s). The Member may
choose the attorney to hanGle its Claim
ARTICLE IV
PREMIUMS
4 1 Member's Premium Costs.
4.1.1 Appropriation of Premium Payments, Each Member Sh3!1 take such action
as may be necessary to include Participation Premium payments payable hereunder in
WurkL'r~' COlnrC11S;1l101l Pn.1gral11
(11.~ 1-06
-2-
.
its tlnnLJ3! agency bL;dget a;;rJ to rn3ke the necessary annual ()~prop!iaticns for all sLlch
paymer:L!O BICEP. The ol:'i:gatlons on the pan of each Member herein containEd shall
be deemed to be and shall be construed to be ddies imposed by law and It shall be the
duty of each and every public ofl'lclal of each Member to (aile such actiol1 3nd do such
thln!Js as are required by law in tbe performance of the official duty of such off,cla:s to
enatlle each Member to carry out and perform Its obligations herelll
4 1.2 The Participation Premium payments due in any Coverage Period shall be
m3de In consideration for Coverage for such Coverage Period. The entire amount of
Participation Premium is due on the Premium Payment Date which shall be August 1 of
each Fiscal Year The determination of the Participation Premium payable In each
Coverage Period by each Member shall be made as soon as reasonably possible but
no later than the day before the renewal date preceding a Coverage Period. Each
Member shall be obligated to pay the PartiCipation Premium which is determined as
follows:
4.121. Administrative Premium Each Member shall pay to BICEP
as Administrative Premium sucb amounts as shall be required for the payment of all
administrative costs of BICEP including but not I!mited to, general management and all
other necessary adm:nistratlve costs of BICEP or charges reqUired to be paid by It in
OI'der to administer the Program, If any. The Administrative r'lelTllUill shallLJe equ3i1y
shared by each Member in the Program
4.122 In a Coverage Period for which BiCEP has purchased
insurance an behalf of each Member, each such Member shall be obligated to pay its
Allucated Costs which Includes but is not limited to the premium fur sLlch Irlsurance and
includes insurance brokerage fees and/or conlmlSSlons.
<1 1 3 At the end of a Coverage Year, Insurers may audit each Member's payroll
whic.ll may iesult ill refunds, credds or additional premium payable.
4.2 Common Premium Provisions to Members and Terminated Members
4.2 1 No Withholding Notwithstanding any dispute between BICEP and a
Member or Terminated Member, including a dispute as to the scope or nature of
Coverage provided by insurers or for any other reason, each Member including a
Terminated Member shall appropriate funds suffiCient to pay and shall make all
Participation Premium payments when due, including any audited payroll as provided In
Section 41.3 above, and shall not withhold any such payments pelldlng the final
resolution of slIch dispute.
422 fJayment of InVOices. BiCEP inVOices are to be paid w:thln 30 days of
presentation to members unless another due date is speCified on the inVOice
\\'[~rku<;' CnrnrCI1\;;(lilll Progrilln
lil-?I-i)(,
-3-
.
.
42.3. Rata on Overdue P"yments In thQ event i\ fJ1enlber cr lcrmir,ated
Member fa!ls to make a[1y ot the payments required In this f-\r1icle, the paymo;nt In
default shall continue as an cbllgat:on of the Member or Terminated Member until the
amount in default shall have been fully paid, and In addition to any remedies avariable
with respect to such default, the Member or Terminated Member agrEes to pay the
same with interest thereon Interest shall be calculated using the BICEPs average
eamirlgs rate as determined In the latest 12-month Investment Performance Poriolio
prepared by BICEP's investment managers, but not to exceed the highest rate
permitted by law from the date such amount was originally payable ThiS provIsion Gln
be waived by the Board on a case-by-case basis.
4 24. Termination of Coverage. In no event shall termination of
Coverage due to Withdrawal or expulsion release a Member from its obligation to pay
damages resulting from defa! ilt under the terms of this Program or from ItS obligation to
pay their Self-Insured Retention of Claims within the scope of Coverage prior to such
Withdrawal BICEP shall continue to pay Settlement of Claims relating to the withdrawn
Member within the scope of Coverage prior to Withdrawal as provided herein, unless the
Member defaults in the payment of ItS continuing obligations described in the preceding
sentence. Notice to Withdraw shall be revocable by the Member only Will] nle cor,senl
of BICEP.
4 25 Member's Rights Upon Dissolution of BICEP. In the event of the
dissolution of BICEP in accordance with Article VI of the Bylaws, the terms and
conditions of thiS Workers' Compensation Program sh;)1I remaill in full force and effect
until such time as all Claims Within the scope of Cover;)ge have been flflally determined
and/or paid
IN WITNESS WHEREOF', the undersigned Member acknowledges reading, fully
understanding and accepting the terms and provisions of the F'rogram
Date
By _~_______~
Print Name
V/or!..cr,;' Cnll1pen:;,lllil[\ Program
01 21-U6
~~i -
** FOR OFFICE USE ONLY - NOT A PUBLIC DOCUMENT **
RESOLUTION AGENDA ITEM TRACKING FORM
Meeting Date (Date Adopted): b /; q
Ayes.~ ~~~"y.-
Change to motion to amend original documents 0
Item # ~ ResolutIOn # dOQb - (1 ~
--f7J Abstain - 8- Absent J 'f- W
Vote:
Companion Resolutions
NulllV oid After:
days I
Resolution # On Attachments: 0
Note on Resolution of attachment stored separately: 0
PUBLISH 0
POST 0
RECORDW/COUNTY 0
By:
Date Sent to Mayor: (p ~b (~
Date of Mayor's Signature: ~
Date ofClerklCDC Signature: ~
Reso. Log Updated: ~
Seal Impressed: .q
Reso. # on StaffReportJQ,
Date MemolLetter Sent for Signature:
I" Reminder Letter Sent:
Date Returned:
2nd Reminder Letter Sent:
Not Returned: 0
Request for Council Action & Staff Report Attached:
Updated Prior Resolutions (Other Than Below):
Updated CITY Personnel Folders (6413,6429,6433, 10584, 10585, 12634):
Updated CDC Personnel Folders (5557):
Updated Traffic Folders (3985, 8234, 655, 92-389):
Yes / No By_
Yes No 7 By_
-
Yes No~ By_
Yes No ,/ By_
Yes No 7 By_
Copies Distributed to:
Animal Control 0 EDA 0 Information Services 0
City Administrator 0 Facilities 0 Parks & Recreation 0
City Attorney ~i~ Finance 0 Police Departrnent 0
Code Compliance 0 Fire Department 0 Public Services 0
Development Services 0 Human Resources ~ fQer~ Water Departrnent 0
Others:
C{)Yl~ 'de
\M,atlfJ
Notes:
Ready to File: _
Date:
Revised 12/18/03