HomeMy WebLinkAboutResolution - 2009-R0341 - Interlocal Agreement - TPSWCJSIF - 08/27/2009Resolution. No. 2009—RO341
August 27, 2009
Item No. 5.9
RESOLUTION
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
THAT the Mayor of the City of Lubbock BE and is hereby authorized and
directed to execute for and on behalf of the City of Lubbock, Interlocal Agreement
Contract Number H0674 by and between the City of Lubbock and Texas Political
Subdivisions Workers' Compensation Joint Self -Insurance Fund, and related documents.
Said Interlocal Agreement is attached hereto and incorporated in this resolution as if fully
set forth herein and shall be included in the minutes of the City Council.
Passed by the City Council this 27th
ATTEST:
AR
RebecA Garza, City Secretary
APPROV AS TO CONTENT:
day of August , 2009.
l
TOM MARTIN, MAYOR
sa Hutcheson, Director of Risk Management
APPROVED AS TO FORM:
Chad Weaver, Assistant City Attorney
vwlccdocslRES.Interlocal Agreement -Texas Political Self -Insurance
August 20, 2009
Resolution No. 2009-RO341
TEXAS POLITICAL SUBDIVISIONS
WORKERS' COMPENSATION JOINT SELF-INSURANCE FUND
INTERLOCAL AGREEMENT
CONTRACT NUMBER H0674
(Guaranteed Cost Plan For Pooled Political Subdivisions)
This Interlocal Agreement entered into by and between the Texas Political Subdivisions
Workers' Compensation Joint Self -Insurance Fund (hereinafter referred to as "Fund") and the
undersigned political subdivision of the State of Texas (hereinafter referred to as "Fund Member")
is for the purpose of providing the statutory benefits prescribed by Chapter 504 of the Texas Labor
Code for employees of political subdivisions.
WITNESSETH:
The undersigned Fund Member in consideration of the adoption of a plan of self-insurance
as authorized by Chapter 504 of the Texas Labor Code, to provide Workers' Compensation benefits
at a minimum cost, and in further consideration of other political subdivisions executing similar
Interlocal Agreements, does hereby agree to become a member of the Fund. The conditions of
membership agreed upon by and between the parties are as follows:
Definition of terms used in this Interlocal Agreement.
a. AIlocated Loss Expense -- the costs incurred in processing claims, including but
not limited to court and State Workers' Compensation Board costs, expenses for
investigation and adjustment of claims, legal expenses, cost containment services
(such as PPO discounts, rehabilitation services, medical management services),
costs in protection and pursuit of subrogation/recovery rights, and similar expenses
chargeable to a particular claim (excluding ordinary overhead expenses of the Fund
or Servicing Contractor such as salaries and other fixed expenses, which shall be
deemed unallocated expenses).
b. Board -- the Board of Trustees of the Texas Political Subdivisions Workers'
Compensation Joint Self -Insurance Fund.
Employee -- reference the definition of "employee" in Chapter 504 of the Texas
Labor Code. For the purpose of the coverage afforded under this Interlocal
Agreement, any full time, salaried elected official who appears on the regular
payrolls of the Fund Member will be considered an employee of the Fund Member.
The Fund Member may extend statutory coverage to certain volunteers (individuals
who do not meet the full definition of employee) by specific Supplement to the
lnterlocal Agreement.
8/20/2004 WCGC-1
d. Experience Rating Factor or Experience Modifier -- that factor which
reflects the Fund Member's individual loss experience and is based on the
Texas Department of Insurance experience rating plan. This experience
Modifier is shown in Paragraph 31 of this Interlocal Agreement.
e. Fund Factor -- that factor determined by the Fund which is used to adjust
the Member's contribution to the Fund. This Fund Factor is shown in
Paragraph 30 of this Interlocal Agreement.
f. Fund Year -- January 1 through December 31. This does not affect or
alter each Fund member's effective date.
g. Loss -- the sums actually paid or payable by the Fund in the settlement or
satisfaction of any claim or suit for which a Fund member is Iiable either by
adjudication or settlement made with the written consent of the Fund.
h. Manual Contribution -- the contribution of the Fund Member determined
by applying the Manual Rate of each classification code to the Fund
Member's payroll in that classification. It is the gross contribution before
any Experience Rating Factor or Fund Factors are applied.
Manual Rates -- the basic workers' compensation rates applicable to each
classification of employees promulgated by the Texas Department of
Insurance or the TPS Board of Trustees.
j, Servicing Contractor -- a third party administrator selected by Board of
Trustees and contracted to provide functional services to the Fund.
k. Standard Contribution -- the contribution that is determined by applying
the Experience Rating Factor of each individual Fund Member to its'
Manual Contribution.
Total Contribution -- that contribution which is due to the Fund and
payable by the undersigned Fund Member. It is equal to the Standard
Contribution multiplied by the Fund Factor plus any fees as determined by
the Board of Trustees.
2. This Interlocal Agreement shall commence at 12.01 a.m. on the date shown as
"effective date" on the signatory page of this Agreement, and shall remain in
force and effect until terminated as hereinafter provided. This Agreement may
be terminated by (a) mutual consent or by (b) either party by giving sixty (60)
days prior written notice of termination to the other party or (c) as otherwise
specified in this Interlocal Agreement or the Bylaws of the Fund.
8/20/2009 WCCC-2
3. The Fund Member must be a political subdivision of the State of Texas and will be bound
by the provisions of Chapter 504 of the Texas Labor Code, as amended.
4. The Fund Member agrees to execute the necessary authorization form(s) permitting the
Fund and the Servicing Contractor to obtain from other providers the experience rating
information for the Fund Member.
5. Annually, each Fund Member shall submit to the Fund on an Estimated Payroll Worksheet
form supplied by the Fund, its estimated payroll for each classification of employees. The
Manual Rates shall be applied to these payrolls to arrive at a Manual Contribution. If the
Fund Member has an established Experience Rating Factor, this factor shall be applied to
the Manual Contribution to determine the Standard Contribution. In the absence of an
earned Experience Rating Factor for the Fund Member, an Experience Rating Factor of 1.0
will be used to determine the Standard Contribution. The Fund Factor will then be applied
to the Standard Contribution to produce the estimated Total Contribution. The Fund
reserves the right to adjust the fund factor on any anniversary date, and the Fund Member
will be notified of any such adjustment by receipt of an amendment to the Interlocal
Agreement prior to that anniversary date.
The Fund Member agrees to pay the annual estimated Total Contribution to the Fund in one
of the following agreed upon basis:
a. Annual -- a lump sum prepayment of the Total Contribution;
b. {quarterly -- an initial payment plus three (3) equal quarterly installments;
C. Monthly -- for Fund Members with a Total Contribution greater than or equal to
$10,000, an initial payment plus 11 equal monthly payments,
or other agreed upon basis.
6. Any party hereto paying for the performance of governmental functions or services shall
make payments therefore from current revenues available to the paying party.
7. Upon anniversary of the Contract Effective Date the Fund Member shall submit actual
payrolls for each classification of employees as reflected by the books of the Fund Member.
Any additional contribution to the Fund based upon the use of actual payrolls as opposed to
estimated payrolls shall be paid by the Fund Member to the Fund within 60 days of the date
the year end audit is mailed to the Fund Member. The Fund reserves the right to audit the
payroll records of any Fund Member.
8/20/2009 WCGC-3
In the event the Fund Member fails or refuses to pay the Total Contribution on a timely
basis as herein provided, the Fund reserves the right to terminate such Fund Member by
giving ten (10) days written notice and to collect any and all Total Contributions that are
earned pro rata for the period(s) preceding termination. In such event, the Fund will notify
the Division of Workers' Compensation of this action. Any Fund Member that is
terminated hereunder shall forfeit any of the refunds that have not been paid prior to the date
of termination.
g. Loss control services will be supplied by the Servicing Contractor to Fund Members to
assist them in following a plan of loss control that may result in reduced losses. The
undersigned Fund Member agrees that it will cooperate in instituting any and all reasonable
loss control recommendations for the purpose of eliminating or minimizing hazards that
would contribute to losses. The Fund Member's failure to cooperate with reasonable loss
control recommendations shall constitute a material breach of this Agreement. In the event
that the recommendations submitted on behalf of the Fund seem unreasonable, the Fund
Member shall have the right to appeal to the Board, and the decision of the Board shall be
final.
10. The Fund, through the Servicing Contractor , agrees on behalf of the Fund Member to pay
all Losses and Allocated Loss expenses, except as otherwise provided herein, and to handle
any and all claims after notice of injury has been given, to prepare all required Division of
Workers' Compensation forms, and provide a defense. The Fund Member hereby appoints
the Fund and the Servicing Contractor as its agent to act in all matters pertaining to
processing and handling of workers' compensation claims and shall cooperate fully in
supplying any information needed or helpful. The Fund Member does hereby agree that any
suit brought by one of its employees pursuant to the provisions of Chapter 504 of the Texas
Labor Code shall be defended in the name of the Fund Member by the counsel selected by
the Servicing Contractor, on behalf of and at the expense of the Fund as necessary for the
prosecution of any litigation. Full cooperation by the Fund Member shall be extended to
supply any information needed or helpful in such defense. The Servicing Contractor shall
conduct all negotiations with the injured employee and/or his Representative at all hearings
and conferences, and negotiate within authority previously granted by the Fund. If a
personal appearance by a representative or a co -employee is necessary, the expense of this
appearance will be paid by the Fund Member. All decisions on individual claims shall be
made by the Fund through the Servicing Contractor, which includes the decision to appeal
or not to appeal a Division of Workers' Compensation final ruling or decision. However,
any Fund Member shall have the right in any claim involving one of its employees, to
consult with the Fund on any decision made by the Servicing Contractor. Notwithstanding
any provision of this paragraph, all reports and filings required by the Texas Workers'
Compensation Act and the Division of Workers' Compensation of any employer will be the
responsibility of the Fund Member. It is further understood that this Agreement does not
cover discrimination suits under Chapter 451 of the Texas Labor Code.
8120/2009 WCGC-4
11. The Fund agrees to provide Employers' Liability coverage (commonly called
coverage B), in accordance with and to the same extent as, the provisions of Part
Two -Employers' Liability Insurance of the standard Workers' Compensation and
Employers' Liability Insurance Policy, as approved by the Texas Department of
Insurance, including the Texas Amendatory Endorsement as it is applicable to such
Part Two, except as follows:
a. The state or territory for such coverage is to be Texas.
b. The limits of liability of this coverage are to be as follows:
Bodily Injury by Accident $100,000 each accident
Bodily Injury by Disease $100,000 each employee
Bodily Injury by Disease $500,000 Interlocal Agreement limit
C. If the Fund Member elects optional higher limits than b. above, the Fund
Member agrees to pay an additional contribution for the optional limits at a
mutually agreeable rate. If so elected, the higher limits and corresponding
charge will be indicated as an Amendment to the Interlocal Agreement.
d. It is understood that this Employers' Liability coverage does not cover
discrimination suits under Chapter 451 of the Texas Labor Code.
e. References to "workers' compensation" in this Interlocal Agreement shall
include Employers' Liability Coverage unless the context clearly shows
otherwise. All other provisions of this Interlocal Agreement shall apply to
this Employers' Liability Coverage unless the context clearly shows
otherwise.
12. Periodically each Fund Member will be provided a computer printout containing a
statement of claims cumulative for said Fund Member by Effective Date of that
Fund Member.
13, The Fund shall pay on behalf of each Fund Member any Division of Workers'
Compensation maintenance tax that may be imposed and file the necessary tax
forms with the Internal Revenue Service.
14. If this Agreement is terminated as provided for in paragraph 2, those claims
handling services provided by the Servicing Contractor as described in paragraph 10
will continue on those claims occurring within the dates of this Interlocal
Agreement until they are ultimately and finally disposed of and closed. All other
obligations under this Interlocal Agreement will end on the date of termination.
15. The Fund shall maintain case reserves and supplemental reserves computed in
accordance with the standard actuarial principles, taking into account historical and
other data, designed to measure claims development and claims incurred but not yet
reported, so that funds will be available to meet these claims as they become due.
8r2O/2009 WCGC-5
1 f. Unencumbered monies of the Fund shall be available for excess contribution
refunds as determined by the Board. The Fund shall invest such monies in
accordance with the Board approved guidelines. All monies that are on deposit with
the Fund, and the investment earnings from these particular monies, shall be used
for the benefit of the Fund Members until such time as the Board deems that it is
financially prudent to declare excess contribution refunds. Such determinations will
be made annually.
17. The Fund shall, at all times, maintain adequate insurance or reinsurance to protect
the financial integrity of the Fund. This insurance or reinsurance is provided so that
Fund Members will have no joint or several liability other than their Total
Contribution and to insure that the Fund Member shall at no time be on an
assessable basis beyond the amount set forth in this Interlocal Agreement. The
Fund, however, reserves the right to adjust this insurance or reinsurance coverage.
18. The Fund agrees that all Fund transactions will be audited annually by a certified
public accounting firm.
19. in order to have an orderly, complete and well -understood basis for contributions to
the Fund, the current plans and future amendments with respect to workers'
compensation rates and premiums of the Texas Department of Insurance have been
utilized as a guide although said plans of rates and premiums do not apply to plans
of self-insurance and there is no intention to bestow rating authority over this plan of
self-insurance upon the Texas Department of Insurance or any other regulatory
authorities. Any word or phrase used in this Interlocal Agreement, which is
ordinarily used in the insurance context, but not in the self-insurance context, shall
be construed as consistent with the self-insurance concept except where the context
clearly indicates no other possible construction.
20. As the administrators of the Fund, the Board shall primarily and constantly keep
foremost in its deliberations and decisions in operating the Fund that each of the
participating Fund Members is a "self-insured". At least annually, the Fund or the
Servicing Contractor shall carefully review, study and consider the actual claims or
loss experience (including reserves for future claims payments) of each of the Fund
Members in order to maintain as nearly as possible an equitable and reasonable
administration of the Fund as applied to each Fund Member.
21. The Fund Member agrees that it will appoint a Workers' Compensation Coordinator
of department head rank or higher, and that the Fund and its Servicing Contractor
shall not be required to contact any other individual except this person. Any notice
to or any agreements with the Workers' Compensation Coordinator shall be binding
upon the Fund Member. The Fund Member may change the Coordinator by giving
written notice to the Fund.
8/20/2009 WCGC-6
23. The Fund Member agrees to timely provide all necessary information to the Fund or
the Servicing Contractor and to timely execute all necessary documents as may be
needed or required for the administration of the Fund.
24. The Fund Member shall have the right to appeal any decision or recommendation of
the Servicing Contractor to the Board whose determination will be final. Any appeal
shall be made in writing to the Fund Secretary within 60 days of decision or
recommendation of the Servicing Contractor.
25, The Fund Member shall take no action to release, discharge or impair its right to seek
recovery of any amounts paid under this Agreement from any person or entity legally
responsible for the bodily injury, sickness or disease, or death for which such payment
is made. Nor may the Fund Member assign such rights without the express, written
approval of the Fund.
26. This Interlocal Agreement, together with all the Amendments, Supplements and other
attachments hereto, constitutes the entire agreement between the parties and
supersedes all previous Interlocal Agreements, promises, representations,
understandings and negotiations, whether written or oral, between the parties with
respect to the subject matter hereof
27. If any portion of this Interlocal Agreement shall be declared illegal or held
unenforceable for any reason, the remaining portions hereof shall continue in full force
and effect.
28. It is the intent of the Parties that the Fund, the Serving Contractor and the Fund
Member each shall bear responsibility for any of its own negligence or its own error or
omission, including, but not limited to, claims alleging violations of the Texas Insurance
Code , the Deceptive Trade Practices and Consumer Protection Act, and the common
law duty of good faith.
29. The Fund and the Servicing Contractor shall not be held accountable for any increased
cost or expense to the Fund Member involving payments of claims, medical or expense
under any contention by the Fund Member that a claim service, risk management
service, loss control service or administrative service could have been handled
differently.
30. The Fund Factor applicable to this Interlocal Agreement for the undersigned Fund
Member and referred to in Paragraphs I e, I 1 and S shall be 0.495 .
31. The Experience Modifier applicable to this Interlocal Agreement for the undersigned
Fund Member and referred to in Paragraphs 1 d, 1 k, 4 and 5 shall be 0.97
TO BE COMPLETED BY FUND MEMBER
City of Lubbock -
Fund Member Name Tom Martin, Mayor
August 27, 2009
Date ATTEST:
Rebe ca Garza, City Secretar
THE WORKERS' COMPENSATION COORDINATOR FOR THE FUND MEMBER IS:
Coordinator Name & Title: Ms. Leisa Hutcheson, Director of Risk Management
Mailing Address: P.O. Box 2000, Lubbock, TX 79457
Street Address: 1625 13th St., Lubbock, TX 79401
Phone Number: (806) 775-2277
Fax Number:
TO BE COMPLETED BY TPS FUND OFFICE
October 01, 2009
Effective Date of Agreement
Signature of Fund Secretary
H0674
Contract Number
August 20, 2009
Date
APP VE AS TO FORM: APPROVED AS TO CONTENT:
Chad Weaver Leisa Hutcheson
Assistant City Attorney Director of Risk Management
Resolution No. 2009—RO341
City of Lubbock
pRKERS' COMPENSATI
Insurance Company Texas Political Subdivision (TPS)
Named Insured: City of Lubbock
Mailing Address: 1625 13th Street
Lubbock, Texas 79401
Effective Date: 1011/2009-2010
Limit of Liability: WORKERS' COMPENSATION as Mandated for the State of Texas:
Employers' Liability
$ 1,000,000 B1 by Accident, Limit per Accident
$ 1,000,000 BI by Disease, Policy Limit
$ 1,000,000 BI by Disease, Limit per Employee
Experience Mod.: .097
Special Terms
And Conditions:
• Terrorism Risk Insurance Act Endorsement
• All other States Endorsement except AK, ND, OH, WA, WV, WY
WORKERS' COMPENSATION CLASSIFICATION
Est. 2009
State Code Description Payroll 2009 Rate
SEE ATTACHED
City of Lubbock
PREMIUM SUMMARY�,
Conditions:
1. City must enter into the Texas Political Subdivision's Interlocal Agreement. A sample
copy is attached.
TPS is a self-insured pool. Reinsurance is provided by Star Insurance Company (A -VIII)
with a pool retention of $350,000 and then statutory coverage thereafter with no aggregate
limit.
Financial statement for TPS is attached.
2. Quotation is based on the estimated payrolls provided by the city.
3. Payroll is auditable at expiration and premium is subject to change.
4. Premium is "Net" of Commission.
5. Rate is guaranteed for 36 months. The TPS Fund factor and Experience Modifier
is not subject to the rate guarantee.
6. 60 days written notice prior to October 1St is required to leave the TPS program.
2009-2010
COVERAGE
Estimated Premium
Workers Compensation
$1,590,500
TOTAL
$1,590,500
Conditions:
1. City must enter into the Texas Political Subdivision's Interlocal Agreement. A sample
copy is attached.
TPS is a self-insured pool. Reinsurance is provided by Star Insurance Company (A -VIII)
with a pool retention of $350,000 and then statutory coverage thereafter with no aggregate
limit.
Financial statement for TPS is attached.
2. Quotation is based on the estimated payrolls provided by the city.
3. Payroll is auditable at expiration and premium is subject to change.
4. Premium is "Net" of Commission.
5. Rate is guaranteed for 36 months. The TPS Fund factor and Experience Modifier
is not subject to the rate guarantee.
6. 60 days written notice prior to October 1St is required to leave the TPS program.
Resolution Na. 2049-RO341
City of Lubbock
Contract Rates Eff, Effective
Member: Number Date
Lubbock, City of 4 6M512009 10!112049
0011 Farm NOG 2 $ 53,622 6.65 $3,566
8 578 7.15 $4,188
3064 Sign Manufacturing 2 $
3365 Welding/Cutting NOC 1 25,990 8.45 $2,196
4299 Copying & Duplicating Service & Drivers 4 $ 109,710 3.06 $3,357
451 i
Building inspection
80
1$940,934 0.94
$18,245
4519
Exterminator &Drivers
7
227,110 4.07
$9,243
5190
Traffic Signal Control Installation 8. Drivers
29
867,343 4.61
$39,985
5191
Computer Device Installation
63
1$,822,450 1.15
$20,958
5506
Street &Road Repair
42
1189,362 7.54
$89.67$
Street or Road Construction or Repair -All Operations - &
24
$ 7.54
$48,374
5506
Drivers
641,570
5606
Contractors Executive Supervisor
1
42,716 1.54
$658
6229
Flood Control
9
250 487 3.91
$9,794
7423
,airport Operations
25
786,240 6.02
$47,329
7520
Waterworks Operations
190
$ 5.87
6,185, 500
$363,089
7539
Electric Light or Power Co Noc -All Employees - &Drivers
262
10,882,148 2.44
$265,524
7580
Sewage Disposal Plant Operation &, Drivers
19
620,635 3.24
$20,109
7590
Garbage Warks
20
589,096 6.78
$39,941
7704
Fire Fighters & Drivers
620
20,$77,676 3.22
$672,261
7720
Police Officers &Drivers
572
5,632,697 3.66
$938,157
8107
Heavy Equipment Maintenance
21
$ 617,$46 4.27
$26,382
8292
Warehouse Ops
4
92,84 5.98
1
$5,552
8391
,Automobile Machine Shop &Drivers
4
84 850 3.03
$2,450
8601
Architect or Engineer -Consulting
21
7$7 591 0.50
$3,688
8810
Clerical Office Employees Noc
605
8,870,108 0.27
$50,949
8831
Animal Shelters $Drivers
23
$ 1.85
580,118
$10,732
8833
Hospital: Professional Employees
38
1$367 196 1.18
$16,133
8838
Library !Museum
60
1746 439 0.63
$11.,003
7720
Motorcycle Police
18
762,048 3.66
$27,891
80,354 3.86
9014
Building Service Contractor
2
39,214 4.95
$1,941
$1,537
9015
Buildings Noc -Operation by Owner or lessee - &Drivers
37
$ 4.34
$
9101
School, Library A11 Other
9
$ 5.81
36,397
$2,115
1,045,975
45,395
9016
Zoo Facility and Drivers
12
80,354 3.86
$10,822
9019
Toll Road Operations 8 Drivers
1
$ 32,024 4.80
$1,537
9079
Restaurant Noc
1
22,167 2.73
$605
9101
School, Library A11 Other
9
$ 5.81
36,397
$2,115
City of Lubbock
9141
School Grossing Guard
1
$
21,621
5.81
$1,256
9102
Park Noc -All Employees - 8 Drivers
94
$ 2,729,271
5.58
$152,293
9154
Theater NOC: All Other Employees
2
$ 79,256
2.47
$1,958
9220
Cemetery Operations 8 Drivers
6
$
211,214
6.36
$13,433
9442
Street Gleaning 8 Drivers
10
274,559
11.37
$31,217
9402
Refuse Collection 8 Drivers
69
$ 2,436,558
11.37
$231,557
3724V
Outside Volunteers
114
110
4.81
$5
8742V
Inside Volunteers
35
$
248,114
0.43
$1,467
104,740,909
0570
Volunteer Police Reserves
5
$ 25,214
3.66
$923
0
Taral Empl.
Trial Payroll
Manual Convi6ut
ioa
5,152
104,740,909
$3,247,556