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CIT'\O)F SAN BERNARDINO - REQUEQ FOR COUNCIL ACTj)N
From: Ronald w. Solheim, Director Subject: Authorization to transfer funds
for payment of l i abil ity Insurance
Dept: Emergency Services & Risk Management and Property-fire-Earthquake Ins-
urance premiums.
Date: March 12, 1985
Synopsis of Previous Council action:
Discussed status of Insurance Market at the Midyear Budget Review
Meeting of March 9, 1985.
NEED TO PLACE ON SUPPlIMENTAl AGENDA:
The Liabi~ity And Property Insurance must both be renewed prior to the
next meetlng of the Mayor And Common counCil.~S ce of funding must
be found prior to that time. F~ .
~. .-tH ., --
onal . Solheim
Recommended motion( s) :
FORM MOTION No.1:
That the Director of Finance, at the request of the Director of Risk Management, with
the approval of the City Administrator, be authorized to transfer funds from the
liability Insurance Reserve Fund into Account 29-423-220, in such amount as is necessary
to pay the premium for renewal liability insurance for the period of March 31, 1985 to
March 31, 1986.
FORM MOTION No.2:
That the Director of Finance, at the request of the Director of Risk Management, with
the approval of the City Administrator, be authorized to transfer funds from the
liability Insurance Reserve Fund into Account 01-421-222, in such amount as is necessary
to pay the premium for renewal of property-fire-earthquake insurance for the period of
March 31, 1985 to March 31, 1986.
Solheim
NOTE:
Accounts 01-312-222, 01-313-222,
and 01-421-222 are de~ignated for
Contact person:
Knudson/Matzer/Solheim
Phone:
5242/5122/5308
N/A
FUNDING REQUIREMENTS:
Amount:
3/13/85
!jest tstlmate
$375,000.
Ward:
1 S
Source:
Supporting data attached:
Memo sent on
Finance:
liability Insurance Reserve
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arren A: nu son
Council Notes:
75_0262
Agenda Item No,
S-I
1 '
&iTY OF SAN BER~ARDINO Q.. MEMORANDUO
To John Matzer, Jr.
City Administrator
From
Ronald W. Solhei
March 13, 1985
Subject
Payment of liability & Property-Fire-
Earthquake Insurance Premiums (85-86)
Date
Approved
Date
At the
Common
urance
Special Midyear Budget Review Meeting of the Mayor And
Council, March 9, 1985, the status of the current Ins-
Market for public agencies, was discussed.
lIABILITY INSURANCE:
In the fy '84-85 budget, we requested and received the sum of
$47,550., which (at that time) we felt would be sufficient to
pay the premium due. Due to the market problems, the estimated
premium will be in the $150,000. to $200,000. range. We expect
this to be confirmed the week of March 18th.
PROPERTY-FIRE-EARTHQUAKE INSURANCE:
In the fy '84-85 budget, we requested and received the sum of
$38,000. in Risk Management, and $12,020. and $6,490. in Public
Buildings, which (at that time) we felt would be sufficient to
pay the premium(s) due. Due to the need for additional earth-
quake insurance for the new library, and increases in values of
real property, in addition to the market problems, the estimated I
premium will be in the $300,000. range. We expect this to be
.~. confirmed the week of March 18th. (We will have one (1) policy
up to $20,000,000. and a second (2nd) for an additional $15,000,000.
which will cover the necessary $35,000,000. for earthquake.)
REQUEST FOR TRANSFER QI FUNDS:
As a result of the reorganization, changes in Administrative/Man-
agement style, and additional professional staff; the liability
Claims Payment Account, is in very good 'shape.' Although the
Finance Department has not closed for February, they were able to
provide me with an approximate balance. The best estimate is that
at the end of two-thirds (2/3) of the current fiscal year, there
is a balance in the liability claims payment account, of forty-five
(45%) to fifty (50%) percent. With that type balance, it has not
been necessary to even consider going into the reserves.
After meeting with you and the Director of Finance, this morning,
I prepared a Form Motion for the Supplimental Agenda, asking that
authority be granted to transfer necessary funds (Currently est-
imated at $375,000.) from the liability Reserve Account, into the
necessary accounts, to cover all premiums due for both renewals on
March 31, 1985. This action will not make it necessary to go into
the General Account, or others, at this time, and with the budget
for fy '85-86, we will request action to replace funds in the re-
serve account.
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It should be noted that as a result of the uncertain legal status
of the Ramada Hotel & Convention Center, I felt I had no choice but
to continue the property-fire-earthquake coverage on the Convention
Center, to protect the city and all officials. (Bonds are involved,
which makes this a more complex problem.)
At such a time as the legal issues are resolved, I shall take action
up to and including legal, if necessary, to recover that portion of
the premium which covers the Convention Center.
The week of March 18th, I am assured by both Insurance Brokers that
we will receive confirmation as to premiums for renewal, and the
amount of insurance available.
RWS:r
cc: Mayor W.R. "Bob" Holcomb
Council Members
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