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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 12/19/2000 - ITEMS RELATING TO THE CITYS SELF-INSURANCE PROGRAM ITEM AGENDA ITEM SUMMARY NUMBER: 16 A- DATE: December 19, 2000 FORT COLLINS CITY COUNCIL Jim O'Neill FROM: John Duval SUBJECT: Items Relating to the City's Self-Insurance Program and its Legal Obligation to Defend and Indemnify its Public Employees in Certain Civil and Criminal Matters. RECOMMENDATION: Staff recommends adoption of the Ordinances on Second Reading. EXECUTIVE SUMMARY: A. Second Reading of Ordinance No. 176, 2000, Adding a New Division 6 to Article V of Chapter 2 of the Code of the City of Fort Collins Concerning the Legal Defense and Indemnification of the City's Public Employees with Respect to Civil Claims and 40 Payment of Their Attorneys' Fees Related to Criminal Charges. B. Second Reading of Ordinance No. 177, 2000, Adding a New Division 3 to Article III of Chapter 8 of the Code of the City of Fort Collins Concerning the City's Self-Insurance Program and Fund. Ordinance No.'s 176 and 177, 2000, were unanimously adopted on First Reading on November 21, 2000, amending the City's self-insurance program as well as City Council's previous Resolutions addressing the City's legal obligation to defend and indemnify its public employees in certain civil actions and to pay their attorneys' fees in certain criminal matters. AGENDA ITEM SUMMARY ITEM NUMBER: 23 DATE: November 21, 2000 . FORT COLLINS CITY COUNCIL STAFF: Jim ONeill John Duval SUBJECT: Items Relating to the City's Self-Insurance Program and its Legal Obligation to Defend and Indemnify its Public Employees in Certain Civil and Criminal Matters. RECOMMENDATION: Staff recommends adoption of the Cdinancola—ding. FINANCIAL IMPACT: The Self-Insurance fund is currently adequately funded based on the 2000 actuarial report. Adoption of these Ordinances shoul dve aff n f this fund. • EXECUTIVE SUMMARY: A. First Reading of Ordinance No. 176, 2000, Adding a New Division 6 to Article V of Chapter 2 of the Code of the Cit of Fort Collins Concerningthe Legal Defense and Indemnification of the C' s b ' E o s it a ect to Civil Claims and Payment of Their Attome Fees R ted t Ch s. 1 B. First Reading of Ordinance o. 177, 0, A ing a ew ivision 3 to Article III of Chapter 8 of the Code of the City of Fort Collins Concerning the City's Self-Insurance Program and Fund. Staff has been reviewing the City's self-insurance program as well as its obligation to defend and indemnify its public employees (which employees include Councilmembers, City board and commission members, and City volunteers) in civil actions and in certain circumstances to pay its public employees' attorneys' fees in criminal matters. The proposed Ordinances make amendments to the City's self-insurance program as well as amendments to City Council's previous Resolutions addressing the City's legal obligation to defend and indemnify its public employees in certain civil actions and to pay their attorneys' fees in certain criminal matters. DATE: November 21, 2000 2 ITEM NUMBER: 23 BACKGROUND: City's Obligation to Defend and Indemnify Its Public Employees In 1987, the City Council adopted Resolution 87-79 to provide for the legal defense and indemnification of the City's employees against civil claims. Resolution 87-79 generally requires the City to defend and indemnify its employees against civil claims and also provides that the City will, under certain circumstances, reimburse its employees for the attorneys' fees they have incurred in defense of a charge for criminal misconduct. Then, in 1994, the Council adopted Resolution 94-101 which amended those provisions of Resolution of 87-79 related to reimbursement of the City's empl r yed ' defense of a charge for criminal misconduct. Resolution 87-79 was originally a y u prithe purpose of affirming the City's obligation to its employees to defend and indemnify them against certain civil claims, as the City is required to do under the Colorado Governmental Immunity Act ("Act"). A recent review of Resolution 87-79 and the Act reveals that the prerequisites that must be satisfied by a public employee of the City under the Act before the City is obligated to defend and indemnify the employee against certain civil claims, are inconsistent in some respects with the prerequisites that are required to be satisfied under Resolution 87-79. Therefore, in order to resolve any conflict that may exist between these prerequisites under Resolution 87-79 and the Act, Ordinance No. 176, 2000, repeals Re u 'ons -79f4- an bstitutes new provisions that eliminate the inconsistencies weer olutt 9 a t.Ordinance No. 176, 2000, also ses h ro iof Res tion 87-79 to allow public employees of other governmental entities to participate in the City's self-insurance program provided that such entities have entered into an intergovernmental agreement with the City setting forth the terms and conditions pursuant to which the City would defend and indemnify the other governmental entities and employees. The likely governmental entities that might participate in the City's self-insurance program would include the Poudre Fire Authority. City's Self-Insurance Program In 1998, the City Council adopt e o o 'on JR n ) establishing the City's self-insurance program and the C 's sel - suran f e d") to provide for the legal defense, settlement and payment iv c s ag s e City or its employees and for the replacement or repair of damaged o en pr Su ently, the Council revised Resolution 88-1 by adopting Resolution 88-183 to expand the self-insurance program to also provide for the legal defense, settlement and payment of worker's compensation claims filed against the City by its employees. Under its self-insurance program, the City can use the Fund to satisfy the City's legal obligations to defend and indemnify its employees from and against civil claims as required by the Act, and as required by Ordinance No. 177, 2000, now before the Council for its consideration, in which the Council reaffirms its defense and indemnity obligations under the Act for its employees that were previously made in Council Resolutions 87-79 and 94-101. A recent review of Resolutions 88-1 and 88-183 reveal that these Resolutions need to be revised to substitute the references in them to Resolution 87-79 with references to the proposed DATE: November 21, 2000 3 ITEM NUMBER: 23 Ordinance, and to also clarify that the Fund can be used to pay all of the "covered expenses" as they are described in Ordinance No. 177, 2000, and that are not otherwise covered by other insurance. In addition, it is necessary to amend Resolution 88-1 in order to allow other governmental entities to be covered, such as the Poudre Fire Authority, to participate in the City's self-insurance program provided they have entered into an intergovernmental agreement with the City setting forth the terms and conditions of such participation. Adoption of Ordinance No. 177, 2000, will repeal and supersede Resolutions 88-1 and 88-183, and make the necessary amendments described above.