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HomeMy WebLinkAbout177 - 12/19/2000 - AMENDING CITY CODE TO ADD A NEW DIVISION CONCERNING THE CITYS SELF-INSURANCE PROGRAM AND FUND ORDINANCE NO. 177, 2000 OF THE COUNCIL OF THE CITY OF FORT COLLINS 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 WHEREAS, on January 5, 1988, the Council of the City of Fort Collins (the "Council") adopted Resolution 88-1 establishing a self-insurance program("the Program")and a self-insurance fund (the "Fund") to provide for the legal defense, settlement and payment of civil claims against the City and/or its public employees and for the replacement or repair of damaged or stolen City property; and WHEREAS, on November 15, 1988, the Council adopted Resolution 88-183 to revise Resolution 88-1 to expand the Program to also provide for the legal defense,settlement and payment of workers' compensation claims filed against the City by its employees; and WHEREAS,by establishing the Program,the City can use the Fund to satisfy the City's legal obligations to defend and indemnify its employees from and against certain civil claims as required by the Colorado Governmental Act (the "Act") and as required by Division 6, Article V of Chapter 2 of the City Code in which the Council reaffirmed its defense and indemnity obligations under the Act to its employees that it previously made in Council's Resolutions 87-79 and 94-101; and WHEREAS, a recent review of Resolutions 88-1 and 88-183 reveals that the provisions of these Resolutions need to be revised to clarify that the Fund can be used to pay all of the "covered expenses," as hereinafter described, that are not otherwise covered by insurance; and WHEREAS,it is also necessary to revise the provisions of Resolution 88-1 in order to allow other governmental entities to participate in the Program provided they have entered into an intergovernmental agreement with the City setting forth the terms and conditions of such participation in the Program; WHEREAS,in order to so revise the provisions of Resolutions 88-1 and 88-183,the Council has determined that it is in the best interest of the City and its public employees that this Ordinance be adopted to make such revisions; and WHEREAS, in making these revisions, it is the Council's intention by the adoption of this Ordinance to repeal and supersede in all respects Resolutions 88-1 and 88-183. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That this Ordinance hereby repeals and supersedes in all respects the provisions contained in Council's Resolutions 88-1 and 88-183 to the Council of the City of Fort Collins. Section 2. That Chapter 8 of the Code of the City of Fort Collins is hereby amended by the addition of a new Division 3 in Article III, which shall read in its entirety as follows: DIVISION 3. SELF-INSURANCE PROGRAM AND FUND Sec. 8-105. Creation and purpose of the program and fund. A self-insurance program and a self-insurance fund are hereby authorized and created for the city. However, the establishment of the program and the fund shall not be construed so as to expand in any way the city's legal liability to third-party claimants, whether under the provisions of the Colorado Governmental Immunity Act or otherwise. Other governmental entities may participate in the program provided that each such entity has entered into an intergovernmental agreement with the city as authorized by state law Section 29-1-203, C.R.S. and, in such event, the terms and conditions of the intergovernmental agreement shall govern the city's obligations under the program to that other governmental entity. Sec. 8-106. Covered expenses. (a) Except to the extent that the city has agreed otherwise in an intergovernmental agreement with any other participating entity concerning the participating entity's legal liability to third-party claimants, as authorized in §8-105, the fund shall only be used to pay the city's uninsured portion of the following "covered expenses": (1) the city's indemnity and defense obligations to its employees under Division 6, Article V of Chapter 2 of this Code. (2) the city's costs and attorneys fees in defending the city and/or any of its employees against: i. any claim arising under contract; ii. an action under Rule 106 of the Colorado Rules of Civil Procedure; iii. a declaratory judgment action; iv. an action arising under a state or federal statute; and V. an inverse condemnation action. (3) judgments entered against and settlements agreed to by the city in civil actions for damages arising under tort, state or federal statute, or Rule 106(a)(2) of the Colorado Rules of Civil Procedure; (4) the city's costs and expenses incurred for the repair or replacement of city property,real or personal,which costs are 2 sustained by reason of the theft of or the damage to said property,excluding normal wear and tear,provided that such theft or damage is customarily covered by a commercial property insurance policy; (5) the city's defense costs, attorneys' fees, medical expenses, disability benefits, indemnity benefits, and other costs associated with worker's compensation claims filed against the city; (6) insurance premiums for liability and property loss insurance policies; and (7) such costs of administering the program as are deemed reasonable and necessary by the city's Director of Purchasing and Risk Management. (b) "Covered expenses" shall not include the city's costs and attorneys' fees incurred in defending its water rights. Sec. 8-107. Funding of the program. The program shall be funded by monies appropriated by the City Council for expenditure from the fund, and the fund is hereby created to be used for payment of the covered expenses as described in §8-106. Notwithstanding the foregoing, no payment from the fund shall exceed the uninsured portion of any covered expense. Sec. 8-108. Implementation and Administration. (a) The city's Director of Purchasing and Risk Management shall be responsible for implementation and administration of the program, including the settlement of claims. The Director is authorized to promulgate rules for the proper daily management, operation and maintenance of the program, and is further authorized to enter into a professional services agreement pursuant to relevant provisions of this Code for the administration of claims. (b) The Director shall authorize expenditures from the fund for covered expenses described in §8-106 and shall maintain such accounting records pertaining to each such transaction as may be deemed necessary by the city's Financial Officer. Covered expenses shall be paid on an occurrence basis. (c) The total amount of the covered expenses paid out of the fund shall be allocated among the various departments of the city, and the departments charged therefor, according to the Director's assessment of each department's exposure. Factors to be considered by the Director shall include, without limitation, each 3 department's payroll, revenue, value of property utilized, previous loss history, expected losses,and reserves for workers'compensation claims that may be required by the Colorado Department of Labor and Employment. Introduced, considered favorably on first reading, and ordered published this 21st day of November, A.D. 2000, and to be presented for final passage on the 19th day of December, A.D. 2000. Mayor ATTEST: -�" k City Clerk Passed and adopted on final reading this 19th day of December;A.D. 2000. Mayor - ATTEST: L". City Clerk 4