HomeMy WebLinkAboutR. L. KAUTZ AND COMPANY - 1976-04-26 f:
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SUPPT,EMEITTAL AGREEMENT c
THIS SUPPI, TENTAL AGRFE14ENT, made and ente~ed into
F
this ,day e%� 197ia, try and between CITY OF # �
HUNTINGTON BEACH, California, a municipal corporation, herein �� Y
called SELF-INSURER, and R. L4 KAUTZ & COMPANY, a California
corporation, herein cQlled SERVIt:E AGENT,
R E C I T A L S:
WHEREAS, S£LF-INSURER and SERVICE AGENT have previously
entered into an agreement on April 27, 1976 by which SERVICE
AGENT agreed to supervise and ac7m n ster SELF-INSUR4P_*S self-~
insurance program, and tc act, as the agent of Sr:�,F-INSUTWR in
matters dealing witst the California. Workers' Compensation Laws,
and
SELF-IN;"URER and SERVICE AG&NT des' Ye to provide for
compensation of SERVICE r SENT for the annual period subsequent
to I J*ly 1979,
NOW, THEREFORE, the agreement is amended as follows:
1. New subsection W is added to paragraph 9 of the
agreement to read as follows:
9(c The remuneration of SERVICEAGENT' for the
period commencing .July 1 19'9 and ending June 30, 1980 sh&ll
e Twenty 'thousand Io-31'ars ($20,000) per annum, payable in equal.
. All other~ tarms and conditions nt the basic agree,
l'y
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:•�ar11�
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3
4
went: shall remin the same.
IN F11%tN ;S WHEREOF, the parties hereto have set their
hands the day, a*nt s and ;dear first ak�x�e written at Nu�Itingtan
aeach, California
CITY CP HUNTINGTON BEACH,
a inunicipal corporation `3
d
x
h
Mayor t
ArPROVED AS TO FORMz
City Clerk t Attorney
P SIiHY# D AND APPROVtDi INITIATP.F ANt) APPRC1A2
i�Sb;
t
.Adi xrrtrataxretty Af Prsar�x}��. a
or Relatirns
R, L. KOTZ & COMPANY, a r
California corporation
"SCRVTe-"* AGENT"
ATTEST:
r s itive Vice-P-eAident
A m;In strative Azgistant
2.
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` REQUEST FOR CITY COUNCIL ACTIONE
Submitted by Edward H. 7hcypJc:n _ Department 1'ersa e
Date Prepared _ Jaly 25, ,1979 Backup Material Attached Yes No
Subject .Aamnd ment to Cantrec't with R. L. Kai`z�Co.
+
City Adm*,nistrW:o<'s Comments
3 ya
r n N
Approve as recoLimenc eci
n
r .
Statement of Issue, Recommendation,Analysis,Funding Sourc+.,Aiternatkte Actiow. �✓
Ccntratt �t with R. iJy i'Jiuty Fi Co. for a:kir.LniJ +�r xcn of
<; worlmrs'coupensatim. The awz:c it :aM asa e the adaLnist-mtrae
service fee from 8.6t per 100 of pay ;11, idilch cq tes to an ; tzi
f f $16,00 , to a flat fee of $ n,000 arr4a1 xy and c harZe tlAe
=ive-mary date fran May 1 t k7tily 1.
Recce. ':fit icn s
Approval of the mrzeertawrit toa the ecritract, with F. L, Mutt 8 Cozpany.
71e, �*rker Y' v ens4b.x.`'.�,Y.l�d. gmn has ',r eri adrdnis t�r'd 4q R. L,
Kautz & Co. since May x, 1.976. erv.ict fries lave zm_ined the sae for
three ,years ii neab.r of � h riser. R� L Yau*... beer
1tF+Ylf ;ing .atisfacto vice during this t � .. nis proposed
z�`+rt'e increase is c=petitige with markers' oagvasatim: ad inis ti,
nt.
Gme Rzd (Account 870590
Aitmatsvek-.ticm.
ObtaLy iVotations and service frram other, workers' o=Vensatit
a&iin%st t *s and seeX new a&ainistrator.
044 we
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y of Huntington
Beach
it 929,,e
f A.BOX 711
CALi �f? � � f
ti CITY TREASURER-WARREN G.HALE � L�C�'.n��t
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"i t�.r�r}�Y
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ry
Dear 'te*4* :
,snl ✓3� f i bM4Y 4.Yt A r'���
P1 f' >° r; 6 1 q gxk9 �rT
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JONES GILLESPIE, INC. l
INSURANCE AGENTS&BROKERS since 9$23 �
,4"t�..iJtY�.�=`�JC1f��1�Y.l��.YUV i'V f.Jl�i:������e.��FT�.iw���,::(°.��.+✓��°5.t4:7 5�!�#�i�+C��'.drYc}� � '.
April 17, 1978
Warren G. Hall
Treasurer/Risk Manager
City of Huntington Beach
P,O. Sox 711 Y
0untington Beach, CA 92648
Re City of Huntington Beads
Coverage: Excess Liability
Carrier; Colu�bia C"asu.dl;y Co-xpany
Policy *: SXP 3583856
Bear "Werren:
Althour h we are still awaiting the final contract on the City's Excess
Self Insured Retention Program from Col uribia Casualty, the carrier has
asked th,,+4 we pass on certain procedures for which they would like your
liabilit,,, aarftr 3'trator to be aware of.
1. 1�rr�ept and accurat, information �u�t be g4vrsn on individual
cases where the i rit%l estimates of the ultimate value of the
claim egaal or exceed{; SC`` of the occurre,ce retention,
L 'there ^av be sr,v ns"ances where the initial estimate of reserve
duals a lower percentage of the retention. lrr-esoect,ive of the
initial evaluation of liability o- reserve, the carrier would like
to know, in a prompt ,rAzener, ,"nvol vi ng the following types of cases
fatal injuries, spinal cord injuries, severe burns, amputation of
'hand, arm, or leg; selsere .eye injury or blirsdness, severe head
srsjus�ies, and aoy catitstrophic rroperty darrag,e used multiple injurien.
3. They have also requested that quarterly liability loss information
be fmished on a regular basis. I have the first quarter's report
uhich has .alreadiy been sent to the carrier.
Fiat=I +ally if you have any questions, please rzive me a call,
Sincerely yours,
Jahn A, ,hones.
rei n
!ll
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Please be advisee that all ynur Liability claims
will be serviced by our Irvine office effective ,
4;24/77.
The office is located at;
17870 Sky Park Circle
Irvine, California 9271,E
Telephone No, (714) 549-7606
Steven younglove will be the Liability Claims
Examiner handl„erg your account Please refer all
correspondence to his attention.
z�s J. Sellxn�
Liability Cliklms kianager
A 00.MV,"*T
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AGREEIMMIT
THIS AGREEPTEIM, entered into th3.W ✓ fia day of
r 1976, by a �d between the � OFITY � HU�TIP�G�'O��
s�>l
BERG`. , hereinafter called IS SL -INSURER, and R. '. KA$T-
4 ;;014P1�N hereinafter .IE SF;?'�10E AGENT, forCt�'ta�:Ti
zer vivo r in Q{3X314G-"i`t: .e duties and. %.`E'.':spow' it tl ev, �
of THE SELVI °12IM11HE lmder ;lip p_•cvisllonz of the Workers'
ompeneatio "Law of `he State of vallftmia as a result of ,
injurles to its e"riployees,
WERE AS, THE SELF-NMUE::R ryaz to self—
Insure Ita 11a ility to its enp—'oyees :ir:uar 't;; the '€orkers'
Ccei e sat on Law* ' the StalUe �f :,ali'or zi , and Wherein, THE
SERVICE AGENT Is in the miperv'4aion and administratIon
NOW, TKMEFORE, ftr art! In War lderation of the n t al
of 11ga,t1=s hereby aawined, ana the p r 'o;"manae of thq aots he7e--
&na,fter4 s t orth, the parties hereto agre as follows:
SHE SEM110Z A0ENT agrees wo Zupe.r .to anJ administer
rO4;ran A ?E 7ZI,?-.` U E , to act as the
�*FttP OSe4ta id♦`O Or HF, aEw #i�'�m t`tors rkelated t RE
Obllaatl
orkeml
of the .abate � " Callfornia and. a. :r as further to vrovlde, to U
W-XNSURER dur %. the tore of this A reenen,t all :he services
x 00r,$ tag-Oula- .y set tot- h herelrafter
a'
r�
Adrainiste"r the self-insurance Plan of TH4. S LF-
19SURER wri Full compliance witi_ all rules and regulations
r = ,
¢vern.ln the ad-Ministration of self-insurance Pazrsuanv to
Seet�on 3 fl et se ,, Iiabor Codes and the California Adminis-
trative .i-rooet ure Act 0
011erny"ent. 4rQ+.ley x'.A"' t
y
r 2. ProvIde a pa"l of PhYsiaia-.s and specialist
�t nt a�.
tt'i{UTT�.' bv�+.��' �'i2'�' � �' CY L"'>�'��"�o'.. E��.±.4'3`,��'L�.�2 9 �,'�l�v£'u k tox1�� SE:t.ri`— NNee x ,
aPProva — u' ov4de cou[i`.x`el ::anj e3l*m':3ee regajj jng
Ss,"-- :k sRRR T s 3 rs L ..id .ra n- s n nedical facilities and
L%J.L+iR.l"iii+ir these i1 4 3 ),.it.YG wI a asl+i'+I 3en�j»}�a W d�SG.. t �•n t
`" J
" .rES r i 'B AGENT; and to +3:I_'..:er Ilse the s T'nish.ijtvi��', of ned4caj
treatment to in�uxed orzpjayeea wbich is re..jibed under the
Workers =Monk ensa On 'Lasts Of t ye "t,2 e
Prepare and file *n tI �
0!" rC"'illfiJ'rm1sa;y
''1• _ I.P bite and pay all °«zi3abilJ' ty benaf4,$ �Iue injut-e'd
�a_ ber:ej`4 is furadS pro-
vided ``'JjE ,SE I _1d ?RR fob* t .c:a ur oses »
f. :'$a''lnLaln all r e woJ»w Ltz and u a is`"Y. s.iY.cal data n losaea
arising rror, employee In;�nrle� in aeo'.�rd m: o �z�th the requiro-
neg'_s .Or}}rrthe DePartment or Indust.-lal Re::atjona, Mate of
*}� 4 I.- ,:s
rovide 0nt ly a manh Crt lne Tabulated r4�,D on all
y ..,,,� s +��z.�n� -Woants Paid as Medloul or com-
pensati n expanse, and the net r0servO on each cane
c
P
7. maxz ,fees of attorneys, approved by HE SEERVIvE i
AGENT, who appear beLore the Workers' Compensation Appeals
i Beard of the State of California and the courts and including
third party and subrogation clams on behal-f of THE SERF-INSURER ram:
on aociunt of injuries to `fH.J SELF--•INSURER's employees occurring
or. or after ;lay 1, 1976, shf,,ll be allowed by THE SLRVICE AGEPY"T � y
as a charge aVainst 12111S SERVICE. ACEN"21s compensation set vat.-
below for the first year of 15�4.s Agreerent. `thereafter, such �.
legal fees shall be paid out of "HB SE IF 2"FEI:I IS Lo a FuPil �
4 Trustee Account; ..
potentially would apz�6ar to equal the a:-=c unt designatod by THE
r.,�
"�:+ZIY�'k �'u Ai3EN"`
JL
will fi.le a report l r^.eiiat,ely with TYE LNST;7ER'S exceFM
insurance carrier;
wr,.,.s.l df3p,tf3:$ t fidt 3 THt SERVICE
,AM7.1 , "he stt of :''1'rE THOUS AN D i3OLLARZ ($5,i 10a :shich ARE ER�'I„E
AtaMrl will aze to establish a trust account can tehalf of THE
SELF-INSURER for se�:tlernent crf *lai..-vq, �"pon report of THE ERA zCE
AG414T, THE SFr-I�ItSJ'MR will trans suffici ent funds to maintain
the trust aocount balance of EI*V*E, THOUSAND f+CL,�ARS ($5,000) .
Macau: i depletion of the trust account occur frequently becau*e
f Volume of of io. , o- claims in exoes4. of FIVE THOUSAND DOL,L,A:
$ ti 00) halve matured at the end, ref' one year, M SE F-INSUEER
and HE aEH��M� AGENT . agree to increase the trust account.
a) All cancelled checks drawn upon the trust
k.
1
account shall be forwarded by THE SERVICE AGENT to THE SELF-
1�5IsI Ii manttxly.
(b) All employees of Z''F bZRVlr,E AGENT who have
access to the crust account or the recovas thereof, will be
Linded In an azount to c, er the h1ghest bal:anwe iy; zald trust
ao out In any given monthly period
TIM MIL1,,11BRAaITON t- be laid urder ' hiz Agree-rent to
,i.CIF SERVICE AGENT R;r by 3H i3�as^'1�Y���Y.'�i +sllial be %:ia..sed ° -,n a
period comienla s.n '°a l 10 -11 6 and shall be {3aZ--.,1ated and pald {
HMID .ED D I,LA.0 ($14; 5 0) per si3'fT9": m w'.jr the f ar zt y&,ar of this
Agreerient, payable monthly In twelve (1*"') equal Insta'.lmentz.
11b rearter gg. the +7�}^��.'y:1'�,.nere�'.v.l�'q.�n to be r;;,'�aj,;i d i:A2a:�e'�I� �.C�.'�.�`.'' Agreement
F,�lr E SI~'F?"v�Z3S A',N':. i. i y TT+X S.'+3xIF-It�YY1S.'URF-1'3 '+.�i93'��.i..l X,-.°e £'.a'lcul 3.t :d and
paid monthly at the rate of B'-, JIND 1NEwIIALF EN11S (S 1`20)
per ONE UNDI;E�r" DDAL'tARM ($100� of Payrolj T E l? »
agrees to Prepare a state;nen' 3" its earned payroll at the close
or eaoh month and to rp.,it; the 4 roresald remuneration to TI
SERVXCE AqVIT with said statement
to audit at any reasonable time SHE SELF—I;I I'IER'z 0a roll
developed during the period of this Agreement. mHE SEVI E AGENT
4 ee$ to per-mit THE EIU -INSURER to audit at any reasonable, time
M SERVICE . MUM's Looks and reoards as,they pertain to I Imo: SELF
NS BLE PAYROLL shall raean total wages ealaries,
( r:
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commissions, bonuses, and other remunerations paid by THE SELF--
INSURER to its employees, but excluC.",nE "overtime remuneration"
as defined in the California Prjanual of Rules, ClassiI'leations F -
and Basic Rates for Compensation Insurances who are covered by
the Workers' Compensation lnztiranae Division of the L-.bor ".")de
of the State of Calif'ornis. 'Remuneration peed to each department .F
head, laity Adrministrator and De put . ¢i¢ty..y l ini n'llsto"�{`ror r ll be. .i.1r' ati�;',11 i;.i•.J`aaa v. 'vdi wi�i�i.
incl adea oaly to ;-0c extent of, but not � exceed, 1=1F-FTEEN "vat.- ;
SAND SIX 1'ln.klk4 M?iL7J w�at/�tY:"T4�3 �,.�.r�y. �� per t:x�rX":xx:i 1
This Agreement s r.a l take affect "#,' 12:0 � .�� s:x.n y
and s€uzkll cont'ime in eff eat: until. April ;'± , ".977, a. :ter
er
wh C°h date x�h4 s As"2"E'erent shall w.C3nt4r:f.c inG'fl'eot unt4l ::':.Y'3^.ea`2led
by ei h�er party wi b ei, e na fi er pro 1r.S.C.eel.
This A reemz ant may Ile c nco'led by either party givin
to the other, in vriting) notice of his intention to cancel this
Agreement, sixty (0,7 days prior tto zany anniversary of May 1.
Services -erein �ont;(z=Pla,,ed shall cove. the operations
of .cIr��.t` SELF-INSUPMA in the State of only.
lit WITNESS 'MMIRED, t o parties hereto have caused they,
proses is to be sigw*d oy their duly wat horl—zed, offtce-s as or the
day, month and year x'.r s4. above written.
"'Y OF qMMINUMN BEACH (THE SELF-
-city lmlayor
AP"OVED AS TO OONMOT: APPROVED AS TO FMI.*
a.• ty stx° "o '``" t^ A t ori e
r r
APPROVED, INITIATING DEPARTMENT* g
R. i4AU Z & COMPANY (THE SERI.IICR
AGENT)
T
ATTEST;
By
G
Ir
s
ADDENDUM M TO AGREEMENT
DATED APRIL 27, 1976
a: This Addendum to the Agreement dated April 27, 1976, between the E.
CITY OF HUNTINGTON BEACH (hereinafter called THE SELF-INSURER) and �rt
{ R. L. KAUTZ & CO. (hereinafter called THE SERVICE AGENI)--provides �m
for safety assistance which will not only help THE SELF--INSURIXR meet
its legal obligations under the Occupational Safety & Health Act, but
assist in its Workers' Compensation cost-saving objectives, as well..
The parties hereto agree as follows:
1. THE SERVICE AGENT's role is relegated to functions which will
assist THE BELL"-INSURER to maintain acceptable control in
areas where THE SELF-TNSURER could not reasonably be .,xpected
to have the necessary expertise, instrumentation or knowledge
to handle such inatters on its own. '
These services include, but, are not limited to, the following
activities.
"OSHA-type" inspection surveys with written, recommendations
for correcting or improving potentially hazardous conditions.
These phys.i :al surveys will be commensurate with the growth
of the program, as well as the experience of THE; SELF-INSURER.
- Safety training of key personnel in such areas as accident
investigation and employee safe practice orientation. Also,
any such techni-gal training as may be required to comply with
applicable safety codes/standards will be introduced into the
control progra=-.
- Perindic review of loss experience on a current--year basis
with provisions for implementing new ox additional control
measures, based on aactuaal. results.
-» 'reparation of specialized safety literature, including
bulletins and training aids, for specific work situations.
2. THE SERVICE AGENT will, in connection with the above matters,
make recf.)mmendations to THE SELF-INSURER which are consistent
with applicable ;Federal and state safety/health regulations..
Recommendations will only apply to those specific conditions
or situations actually observed, however; and such findingT
would not: purport to list all possible hazards nor amply that,
if other problems exist, they have been adequately controlled.
. Representatives of THE SERVICE AGENT shall not be considered
to be employees or agents of THE SELV-INSURER or be entitled
o participate in any manag*-ment matters (other, than by way of
f advising) a nor have any authority t�- cause. or direct THE SELF-
I14SeRER to abido by thgi.r .recommendations.
}
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}
4 Engagement of THE SERVICE AGENT, as outlined, shall: be effect-
ive may 1, 1977, This Addendum may be cancelled or modified �
by either party giving to the other, in writing, notice of bis
intention to cancel. the Addendum sixty (60) days prior to any �
subsequent anniversary date;
51 For zervAIL-es rendered under this Addendum, THE SZLF--INSURER
shall pay, to THE SERVICE AGENT, in addition to the remuneration #'
specified under the Agreement dated .April 27, 1976, the aggregate
scam of 52,aflt?, payable at the rate of $375 per quarter.
CITY OF HUNTING ON REACH
Attest-.
Alicia M. Pon S�*enkran, Payor Pro Tetm%,are
Alir'as k. Wtnt orth. City Clark
Cnanie Broe'kway,Deputy
ATTES
r By �
1-W RHEINHEIMZR, P.E. , CSk
e--President, Safety Services
Dated this Ot day of May, 1977.
QPM•avw As To ;FaVt
Do P� jr
city Wo,=OY
$jf ,
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R
FIESOLUTION NO 4229
A RESOLUTION TION Off' Tffr CITY COUNCIL OF THE CITY
OF HU'NTINGTON BEACH TERMINATINO ITS POLICY
WITH STATE mOMPENSATION INSURANCE FUND, ADD Will..,
AUTHORIZING EXECMION OF AN AOREEtENT WITH ti4
t L. KAUTZ A0 COMPANY FOR CERTAIN SERVICES Y ,,
IN CONNECTION WITH THE DUTIES ,AND RESPONSI-
BILITIES OF CITY AS A SELF-INSURER UNDER THE
PROVISIONS OF THE 't3MMS' COMPENSATION LAWS �y
OF THR STAVE OF CALIFORNIA AS A RESUVT OF 1-11- �
JURIES TO ITS M4PLOYEES
' MMEAS, the o.ty (.�esJres to underts e to self-insure its
liability to Its employees pursuant to the wox*Ikers' compensation
maws of the State of California; and
Pursuant to this intention, 4t is necessary to terminate
the Yurreact policy with the State C'ozpeiisWon In4aurance Fund
d
City deatres use employ a service agent to perform cortairr.
services In connection with the duties and responsIbilities of
the city 1f-insurer,
IMF THERE.)R� BE IT RESOLVED by the City Council of the
C ty of Huntington Boach that:
I. The E roounel Director Is hereby directed to take the
necessary steps to torr..Iriate the Ity'3 policy with State
Compensation Im rance Fund effect ivy t•!av 1, 1976, whereupon
the city t,hall be teohnioally uninsured.
The Mayor and City Clerk are hereby authorized and
Xak4 x and Co vary,, said agreement to he effective May 1, 1976.
A SED Alfa VIDOPTE0 Eby 'the° City Council of the City of
Ho ,t :ngton 0ea0h at an a o rned reeular meeting thereof held
oy- she 26th 4ay oir April, 1976.
i
i
s.
ATTEST APPROVED AS TO FORM: ri
City Clerk City A;tta a lnM
APPROVED AS TO CONTENT: APPROVED, INITIATING DEPARTMENT:
s4�
12
E. t Administrator ,
y
.. No. 4229
4
Of CALIFORNIA
IA }
OF
CITY OF J1tw1xGT0$ DFACH
t
n,
1, AUCIA M. WZMV RT�1, the duly elected, qualified City
Clere. of the City of Runtingtom Beach,, and erbofficlo Clerk of thip
City Council of said City, du hereby certify that the whole ntwibor of
rk.trftbors of the City Council of the City of llaptiiizton beach is Seven;
that the foregoing .resolution was pas;see aM adopted by- the. aaffira6t ve
vote of more than a majority of all the wambera of said City Council
-at A regular adjourned meeting thereof field on the. w25th day
19 7(3 , the fr�41owin$ wrote;
..''
AYES: C4uncilv)en
Bartlett, t ibbo, Sla t, Shun, Vatt insoo, Taeder
ADES. Councilve nt
Nana
AASZN . G0twci Iron'.,
Coen
City Clerk and etc-Noffkcio Clark
of the City Council of tkte M
of Huntington Zeach, CaTiirs'x^nia
116111011
V
j
i
Los azxgola a, t�h WO67
City wncil Of till ate y of sxxxtiw;tou UOACU at Jts adjaurodd
fix x 1ut g I*ld nkoxtu xy, w4 rx l 26'. U17 , Vp=-v aqreemnt
botwaw:m tale a y all A. L. Butz & tow'PARS. for C"taip sa:k's!'ic as
4.4 mecaozx xi , t4m du �!xr and x'ea -ti�
I�icloaW in a atay oxcout d o j�, of 4 " 49roelamat 4 r your records.
u x r xxs cution of Gaya agroemon ,
�'x�tx
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}`r
City of HuntingtonBeach
J CITY" R° ASURER-WARREN G.HALL
April 2. 1976 .
To Honorable Mayor and City Council �.
and 14 D. Rowlands, Administrator
czb ectSelf lnsuranct on Workers ompen 5ar,io
The coo taee on Workers Compensation self* insurance has done
thefollowing:
L Rut out bids for an administrative company to regally handle
management of ,t.ie program. Selected R. 1„ Kautz & Co. as the meant
responsive as well as low bidder.
2. Has a jab description ana selection process under way for a
Worms -Comp. administrator,
. IUll present contract and financial p ram ror adoption by
boarmit on April 1% 1976 now being wor'kzd €ut between the City
Attorneys otficc and: R. L. 'Kauto I hex.
44 Treasarer will get Excess tiab lity ror claims, in exwe s of
100*000..00 from Jones-Gillespie & Ooppert a they submitted r
tie bid for same covor° ges, after investigatine costs, 4.f any,
of somo add.iti-On .l desired clauses in the coverages.
We need a Orval of the c�acr�sc�?�o A. �� i "� r
1.. Send notice €f intent to be urri cured to State Compensation 'Ins.
Co. to b4 effective day' 1, 1976 and end our contract with them,,
'lease act on this trigger requirement to start u$ on tho road
to both saviogs and improved: care and handling of emp, ogees com-
pensat oA claims and problems.
Oity Tra.40ur4r/Ris anager
c. ern onra f O Attorney
�o�s ;n� 'pars�hel. ���ec�or
Sea Arguello, Finance Diroctor
y
i
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a .its of Huntington each/-# -
5
��� P,o, pox 190 CALIFORNIA 92648
PERSONNEL DEPARTMENT �-
A-pril 22, I97
Ui
y,
Honorable Mayor and
City Council Members
rAttn: Floyd G. Belsith City Administrator
Subject: Workers CarsFensation-Safety Service; f
I recommend that the City Council av)nrr;ve the attached
for safety services fcr 3dditiol4 to our agreement with
the R. Z. Iaaut Company, administrator of our self-
insured workers compensation progran.
Funds for these services am inclueed in the worker
compensation, account and will require no additional
budget consideration.
cerely,
r:dward 11. Thomt�±st n
Dir. PersoDnel/Labor Pel:ations
ENT.k.f
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a' 404
R We Cityof Huntingtonc
April 25, 1976
Von.-%rahle Mayor and
City Council �temhe r
Attn: payx4� D. Rowlands
City Administrator
Y.
uttjectz Workers Cozpensation Self Insurance program: �
We proposed that the laity cancel the insurance policy with
State rompensation Insurance Fund and commePtce Self insura;tce,
off;,c, '_-ve May 1, 1976
The primary rea.gon for our going to workers compensation self
znsur,knce is an effrrt to pyovide better, nore efficient claim
service for em-ployees -ii th the resulting imp•rove,ment in our
overall enploye•c relations program and. the opportunity to save
sigrtifica t nuteX in the process.
Our experience with State Compensation Insurance Fund, cur
cuxrex.t workers conpeusation insurance carrier, has indicated
an e tre el r inefficient and ineffective clalm service, We
havo found that our repe ,Led cortpl:aint,- do little or nothing.
Tfiei.r overall I14ci,adaxsic,�l attitude has caused attrzumtMt-ah3e
delays with the resulting increase In otrr overall cast. As
,art e temple, their delays h,%vff caused the City to expend signifi-
cant amounts of money t-tN :pal' enployaos who are cf'f work due to
am industrial inn r , when, with more efficent and effective claim
sf,-rvica they may hell have been returned to work earlier than
has been the =rasa. Delays in securing doctors appointments
have also added sigh}if icintly to our cost. It generates employee
relations problems as the employees feel they are boing ignored
and this is reflecting unfavorably on the City in Marty cases.
The workers compensation has a very direct tie to disability
retirement with safety employees and a close cotard inat, nn has not:
beta achieved with State pond due to o lack of their informing
us on a timely basis of the disability status of employees off work,
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April 23, 1976
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The feelings of being ignored and frustration experienc�;d by
employees has resulted in many cases of unnecessary litigation,
thereby delaying: final settlements even more with resvtlting
added costa
The employee associations are aware of our intended move to
self-insurance and to our knowledge, none of them are opposed aS ,`°
the benefits set by statute Mould remain the same, however, there
would be a substantially improved service to the employees and
the City at a: significantly lesser cost.
Indicative of the apparent feelings of other public: agencies toward
State Compensation Insurance Fund, it ;should ties noted that two
of our bidders for the administrative portion )f our program `
currently are 'handling the self insurance for 51, cities, 10 counties,
and 10 school and other districts in the State of California.
The annual cust5 of self insurance are going to be premised on
the cost of premium if we had remained with Stat# Fund, until an
adequate reserve is guilt up which will stablize the city position
in the future if we should incur unusual and substantial losses
in a year.
The procedure proposed is to assess each month the regular manual
rates that would al}plv to each c.lassi -ication of naayroll, charge
it to the departmental expense and prat tte premium thus generated
into she "Workers Compensation Self Insurance Reserve".
These calculations are our bes� estimate of the next two years:
Trust
Depos i is Ex es Net Trust
May ind ,June 197E (2,112 x
5t�t3�000 �5.1,33�
May 1, 1976 8.7% increase 7,250 0,584
State Compshort term cancellation 1€3,300
Six weeks salary for Compensation Admin. 2,400
Estimated claims cost 9,00(1
Peinsurance to $5 million (100,000 deduct.) 25,320 loatsn
R.L. Kautz annual admin. fee (incl. legal) _ 1 500
BALANCE 6 0/7d 9
Year 10 6/77 est. premiums 165,000 76S,000
1.2 mo. salary for Comp Adman.. 20,000
p,,L Kautz annual admin, fee (Incl. legal.) 16,S00
Est. clatAs costs
Peinurane to 5 met100 xs deduct.) 4I4 S00
PALAA C 6/50/77 �d71;��"
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Trust
Beposzis Expenses Net Trust
Year 1977178 est. premiums 900,000 900,030
Est, claims costs 420,000
Admin. pee
Salary for Comp Admin. 22,000
Reinsurance to Smm (1.00 m deduct.) 31,000
Est. Legal Costs 7,500 438 500 =s`.
BALANCE 6/30/76 742,064 '
0.
Indicates reserve requirement based can $420,000 claims -1260,000
The reserve should be built up to the point where it equals three y
` t ;rues the arnu,tl claim costs and then the accrual continues at
the standard manual rate but excess reserve would he returned to
general Rand after the reserve level has beer. recalculated annually.
We strongly recommend that the Council approve the necessary
resolutions to accomplish the switch to self-insurance effective
ii.neere lv
"sin s
City* Admin-, -ator
i A tritp s��6:n
Stir. Personnel/Labor Relations r:
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.rear
City Treasurer
s
IMBLIC BODIES LEGALLY UNINSURED
UNDER k . L. KAUTZ & CO. ADMINISTRATION
WCiRMRS t COMPtNSATION LOSS EXPERIENCE AS OF 6/30/75
L/U doss
o t_ , Premium Paid Reserve incurred patio
24. County of Alameda $1,455,614 $274,430 $472,047 $746,477 51%
12 City of Anaheim 808,.493 97,838 163,685 261,523 32%
1.2 City of AZUsa 128,115 26,886 59,675 86,561. 67%
12 City of Baldwin Park 99,937 3,343 8,807 12,150 12
.12 City of Ezea 93,577 5,628 11,489 17,117 18%
>'24 City of Chula Vista 229,193 13,162 17,303 30,465 13%
6 City of Colton 203,783 1,719 8,189 9,908 5%
7 City of Corona 93,630 7,654 23,907 31,761 34%
12 City of Done * 284,241 24,032 20,219 44,251 16 If
1.0 City of Fountain Valley 121,300 18,221 19,802 38,023 31%
12 City cif Fremont 331,748 20,356 45,838 66,194 20%
10 city of Glendora 70,819 5,432 9,463 14,895 21%
1.2 City of Hermosa each 76,727 6,959 12,090 19,059 25%
12 City of Huntington Park 112,01.1 71897 18,537 26,434 23% �
1.2 City of Imperial: Beach 57,1.60 3,846 3,486 7,332 12%
12 City of Inglewood 554,865 63,543 89,474 153,01.7 28%
12 City of La Habra 135,515 10,705 20,839 31,544 23%
12' City of La Mask r 136,788 15,231 23,196 38,427 28%
8 City of Lynwood: 149,605 8,988 9,314 18,302 12%
24 City of Manhattan Beach 145,653 32,799 38,268 71,067 49%
12 City of Montclair 103,020 15,067 34,433 49,500 48%
. 12 City of National City 163,408 15,521 18,624 34,145 21% �
12 City of Oceanside 332,348 35,551 57,219 92,770 28%
6h Clay of Ontario 171,610 18,759 40,250 59,009 34%
9 City of Orange 307,960 19,295 62,840 92,135 27%
72 City of Pasadena 3,776,245 1,071,631 726,647 1,798,278 50% I'
12 City of Redondo Beach 238,8$3 39,558 74,612 114,170 48%
47 City of Sacramento 3,634,060 944,414 635,426 1,579,840 43%
4S County of Sacramento 2,860,095 772,249 479,544 1,251,793 44%
34 City of Santa Cruz 477,350 155,044 1.71.,993 327,037 69% �{
24 City of San Leandro 562,963 46,084 55,492 1.01,576 18%
48' City of Torrance 2,16 ?,v L 716,977 287,932 1.,0040909 47% {
12 City of Upland $1,081 2,551 8,791. 11,342 14% ,(
12 City of Whittier 308,193 41,528 95,,304 136,832 44 ; iE
$20,468,9O6 $4,543,-098 $3,824,735 $8,367,833 40%
zr.
ORDINANCE 140. 205
r.
AN ORDINANCE of THE CITY OF 14UNTINGTON BENCH
AMENDING THE HUNTINGTON BEACH MUNICIPAL CODE
BY ABT7= THERETO SECTION In,j 2.i 10 ESTABLISH- r
INN A SELF,-INSURER I S LOSS FUND TRUSTEE ACCOUNT
x�
The City Council, of the City of Huntington Beach doee
t ftdai.n as follows:
SECTION 1, Pursuant to Section 1215 of the 1=.in ton
:a
Beach jai ty Charter, the Huntington Beach !"unici.pal Cone i z
hereby wTiended by aoding, thereto Section 2.72.110 to read as
follows
2.7¢,1T. Cel -insurer's Noes Fund Trustee Account. A
"Self-x.t7ourer's Doss uii r'ustee AC' J int { iherebycreated,
Z-1ue h, a peo unt stall receive as MVeriues those s.Mounts from tbose
sources as designated by and appropriated by the city council.
isbur*aetleots from such account ohall be used for the fallowing
purpoaea only
(a) To pay all nedical and disability compensatitin bene-
fits ror city employeez who incur Job--:related Injuries as re-
quired by Mate law.
(fa) �<� pay premiums for worriers' compensation irauranCe
or re-imuranee.
(e) `o pay tFte costs of workers' compensation claims
;rd it istrrati+ rr as performed by city staff or by an outside
contractor or consultant.
(d) 4.10 pay .fees for legal services required to minimize
the eity rs raor k rs' ccmpe-tisa:tion lialai l ty r.ad to recover
workmrs' compensation casts from priory insurers and other
third parties.
(0) To pay personnel costs: associated with the temporary
replacement of injured employees,,
U) To pay 'the ss.larwes, fees and expenses of medical
and safety coneuit=ants and staff, including appropriate city,
staff Personnel and their expenses,
T
To pay a..y other charges or costs req i�r*_pd for t1l
t,lty to satisfy its legal, obligations under the stt�re vtorl.ersl ,
.: t rerxaation laws,- to reducQ ermloyee injurieti and the e:il1
ployee lost tivie and sufferinC associated therewi.t€,�; and to
participate 11r, and pay the times of organizations whi,rh serve x,
x tite needz of employers obligated to Fay workers$ corm pensation
benefits its.
SECTION 2�. This ordinance shall take effect thirty nays
r x
` after its adoption. '"he City Clerk stall certify to the passage �J
�f this or;i nance and cause same to he Published wi.thIn fi f teen
days after adoption in the Huntington Beach News, a weekly news-
paper of general alr elation, printed and published �n Mantington
peach =,a ifc rr ia,
PA.1).1-1, AND AD IFTEJ by 'the City Icunoil of the City of
Unz- � , Yg t i g f held on the 3rd,
;<s.r,.xfi�.7r��-`� z °.r"`�:':iC� �:� � I"�"`�..I.cc3X` ���eo 22 �:h�x'F'C>y
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Mayor
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A x: APPROVED AS TO FORM{
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Ord. ito. 2C)S B
STATE DIF CAIF'OMIA
C;C3tfNry of ORA ECM OF IWNrINGTOR BEAM
s.
1, ALICIA M. WE3a*I:WORTU, the duly elected:,, qualified City
Clerk o� the City of Huntington Beach and ex=officio Clerk of the t.
City Council of the said City, do hereby certify that the whole number
of mb,ero of the City Council of the City .of Huntington Beach i.o seven;
that the foregoing ordinance was read: to said City Council at a regular
adjourned weeting thereof held on the 16th_ . day of April ,
19. 76,, and stag again read to said City Council at a regular . �o
& Y
meeting thereof held on the 3rd day of May _._.,., 1S76r and ais
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vae p#vzod and adopted by the; affirmative vote of -more t4an a majority of
all the methbers of said City Council.
AYkS: Councilmen:
' Bartlett, Pattitaaon, Coen, Gibbs, gia:bert, Shea kman, wieder
NOE Coartcilme":
$Oslo?
ABSW. Councilmen:
;idne
City Clerk and ex-offi:cio Clerk
of the City CouAcil of the City
of Huntington, teach, California
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