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HomeMy WebLinkAboutResolution - 2469 - Interlocal Agreement - TML WCJI Fund - Insurance Coverage - 11/13/1986DGV:da RESOLUTION Resolution #2469 November 13, 1986 Agenda Item #21 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 an Interlocal Agreement and associated documents with the Texas Municipal League workers' Compensation Joint Insurance Fund for insurance coverage for the City of Lubbock, a copy of which agreement is attached herewith, which shall be spread upon the minutes of the Council and as spread upon the minutes of this Council shall constitute and be a part of this Resolution as if fully copied herein in detail. Passed by the City Council this 13th day of November I ATTEST"� anettN_- Boyd, City Secreiar APPROVED AS TO CONTENT: Robert Massengale, Ass'stant City Manager for Financial Services APPROVED AS TO FORM: D&rald G. Vandiver, Fir Assistant City Attorney B.C. McMINN, MAYOR ENDORSEMENT TO INTERLOCAL AGREEMENT TML WORKERS' COMPENSATION JOINT INSURANCE FUND City Name Contract Number A0263 Lubbock Resolution #2469 Effective Date 10/1/86 In consideration of the Employer Member's request for payment of additional benefits and in further consideration of the Fund's agreement to pay such bene- fits, the Interlocal Agreement is amended by adding thereto the applicable coverages indicated below. The Fund will pay on behalf of the employer Member, if a volunteer employee in a classification indicated below, shall sustain injury, including death resulting therefrom, under circumstances which would have rendered the Employer Member liable for compensation if the injured volunteer employee and the Employer Mem- ber had been subject to the Texas Workers' Compensation Law with respect to such voluntary employment, an amount equal to the compensation and other benefits which would have been payable under such law had the injured volunteer and the Employer Member been subject to such law with respect to such voluntary employ- ment. The parties of this agreement do not by its use intend to make applicable to themselves any provision of the Texas Workers' Compensation Law not already in force and effect as to them. The reference to the Texas Workers' Compensa- tion Law is intended as a measure and extent of benefits and the liability therefore and not an adoption of the law. The Employer Member agrees to pay the premium for the volunteer employee payroll classifications indicated below. This agreement shall be subject to all the terms, provisions and conditions of the Interlocal Agreement, and nothing herein contained shall vary, alter or ex- tend any term, provision or condition of the Interlocal Agreement except as herein specifically stated. Description of Group of Volunteer Employees X Elected Officials Code 8742 Volunteer Firemen Code 7704 Police Reserves Code 7720 Volunteer Ambulance/EMS Attendants Code 7720 All Inside Volunteers Code 8742 All Outside Volunteers Code 3742 M Res. #2469 February 5, 1987 TEXAS MUNICIPAL LEAGUE WORKERS' COMPENSATION JOINT INSURANCE FUND 211 East Seventh Street, Suite 1020, Austin Texas 78701 INTERLOCAL AGREEMENT This Contract and Interlocal Agreement is entered into by and between the Texas Municipal League Workers' Compensation Joint Insurance Fund (hereinafter referred to as "Fund") and the undersigned political subdivision of the State of Texas (hereinafter referred to as "Employer Member") for the purpose of providing the statutory benefits prescribed by Article 8309h of the Texas Workers' Compensation Act for employees of political subdivisions. The undersigned Employer Member in consideration of the adoption of a plan of self-insurance as authorized in Article 8309h, Vernon's Annotated Texas Statutes, to provide workers' compensation benefits at a minimum cost and in further consideration of other political subdivisions executing identical Interlocal Agreements does hereby agree to become a self-insured workers' com- pensation employer by becoming one of the members of the Fund Pool of self- insured Employer Members. The conditions of membership agreed upon by and between the parties are as follows: 1. Definition of terms used in this Interlocal Agreement a. "Board" --refers to the Board of Trustees of the Texas Municipal League Workers' Compensation Joint Insurance Fund. b. "Premium" and "Contribution" --are used interchangeably in some parts of this Interlocal Agreement. "Premium" is used to identify the rating formulas established by the State Board of Insurance, which are used as guidelines to establish Employer Members' cash contributions to the Fund. Any reference at any time in this Interlocal Agreement to an insurance term not ordinarily a part of self-insurance shall be deemed for convenience only and is not to be construed as being contrary to the self-insurance concept ex- cept where the context clearly indicates no other possible inter- pretation such as, but not limited to, the reference to "reinsurance." c. "Manual Rates" --the basic workers' compensation rates applicable to each classification of employees promulgated by the State Board of Insurance. d. "Experience Modifier" --refers to the factor applied to the manual rates that reflects the political subdivision's loss experience, which is based on the State Board of Insurance promulgated in- surance plan. e. "Standard Rates" --rates that are determined by applying the ex- perience modifier of each individual Employer Member to the annual rates. February 5, 1987 f. "Fund Modifier" --the percentage figure that is applied to the standard rates by the Fund to reflect the savings to the Employer Member by entering into the Interlocal Agreement. g. "Fund Year" --October 1 through September 30. h. "Agreement Period" --The continuous period since the Employer Mem- ber first became a Member of this Fund excluding, however, any period or periods of time therein that the Employer Member did not participate as a Member of the Fund. 2. The Board of Trustees, acting through its agents and TML staff, is res- ponsible for the administration of all Fund business on behalf of the Employer Members. 3. Statutory workers' compensation benefits are provided for paid employees of the Employer Member only. The Employer Member may extend statutory coverage to the following class or classes of volunteers by specific endorsement to the Interlocal Agreement: elected officials; volunteer firemen; police reserves; volunteer ambulance/ems attendants; all inside volunteers; all outside volunteers. Provisions exist for reporting es- timated annual payroll substitute figures which shall be used to develop an annual contribution for this additional statutory coverage. 4. The term of this Agreement and the self-insurance provided to the Em- ployer Member shall be continuous commencing 12:01 am on the date desig- nated in this Agreement until terminated as provided below. This Agreement may be terminated by either party giving to the other sixty (60) days prior written notice of intent to terminate except the Employer Member may terminate this Agreement and its statutory coverages thereunder without giving the sixty (60) days notice if the reason is because of a change by the Fund in the Employer Member's contribution, provided that no termination by the Employer Member shall be effective prior to the date that written notice of termination is actually received in the offices of the Texas Municipal League Workers' Compensa- tion Joint Insurance Fund and provided further that the Employer Member agrees to and shall pay the applicable premium and contribution for those coverages it is terminating until the date the notice of termina- tion is actually received by the Fund. It is the intention of all the parties that the Member's statutory coverages under this agreement shall remain in full force and effect from Fund Year to Fund Year, subject to the terms, conditions and limitations that the Fund may require to protect its, solvency and to comply with reinsurance requirements, until notice of termination is given as herein provided. Realizing that the Employer Member needs the earliest possible information concerning the contribution that will be required for any new Fund Year, the Fund will endeavor to provide this information as soon as possible before the beginning of each new Fund Year. The Fund will have the right to terminate this agreeement only for non- compliance with Paragraphs 5, 7, and 10. t February 5, 1987 5• The Employer Member and the Fund agree that this Agreement is a "cash- flow" Agreement. The Employer Member assumes financial responsibility for all losses under the deductible attachment point indicated on the attached Schedule A. However, it shall be the responsibility of the Fund to make initial payment for all such losses under the deductible attachment point from the Escrow Account described below, remitting to the Employer Member a monthly billing statement indicating amounts of such payments made on behalf of the Employer Member. The Employer Mem- ber shall promptly reimburse the Fund for all such payments. Annually, each Employer Member shall submit to the Fund on a Premium Worksheet form supplied by the Fund, its estimated payroll for each classification of employee. The rates established by the Board of Trustees shall be used to arrive at a manual premium. If the Employer Member has established, through experience, a modifier, then the ex- perience modification of that Employer Member shall be used to arrive at the standard premium to be paid by the Employer Member. In the absence of an earned experience modification for the Employer Member, the manual rate as established by the State Board of Insurance in effect at the beginning of each Fund Year will be used as a guide to produce a manual, as well as a standard contribution. It is understood by the Employer Member that there will be contribution adjustments based upon the in- creased benefit levels mandated by the Texas Workers' Compensation Act. The Employer Member agrees to fund at the inception of this Interlocal Agreement and maintain with the Fund a loss payment Escrow Account which shall be equal to two (2) months of estimated losses, based upon the preceeding twelve (12) month period. This Escrow Account shall be ad- justed at least annually prior to December 1, and the Fund shall have the option of making interim adjustments as may be necessary to maintain an amount equal to two (2) months of actual paid losses. The Employer Member agrees to pay the Fund, on or before the inception date of this Interlocal Agreement, a deposit premium equal to 25% of the annual reinsurance (catastrophic excess of loss and aggregate stop -loss) charges. The balance of such reinsurance charges shall be payable in ten (10) equal monthly installments. Monthly billing to the Employer Member will indicate a current amount due of 1/12 of the actual annual administration fee, and 1/12 of the estimated annual fee for the follow- ing: claims handling, loss control, and management information system (MIS) reports. An audit adjustment for all charges billed on an esti- mated basis after the end of each Fund Year will reflect actual fees incurred, and the resulting debit or credit applied. At the end of each and every Fund year, there shall be submitted by the Employer Member actual payrolls as reflected by the books of the Em- ployer Member, and any additional amounts payable to the Fund based upon the actual payroll shall be' paid, and lesser amounts, payable shall be adjusted by refund to the Employer Member. The Fund reserves the right to audit the payroll records of any Employer Member. a February 5, 1987 In the event that. the Employer Member fails or refuses to make the pay- ments of premiums as herein provided, the Fund reserves the right to terminate such Employer Member by giving ten (10) days' written notice and to collect any and all premiums that are earned pro rata for the period preceding contract termination. 6. The Fund shall maintain adequate protection from catastrophic losses to protect its financial integrity. Aggregate protection shall also be maintained to ensure that the Employer Member shall at no time be asses- sed. The Employer Member's contributions shall be limited to that amount as calculated under this Agreement. Notwithstanding the provision of the foregoing paragraph, it is agreed the Board shall have the right to adjust the financial protection out- lined above and/or amend such protection as it finds available or it deems necessary to maintain the fiscal soundness of the Fund at the beginning of or during any Fund year. If excess and/or aggregate reinsurance is not available, the Fund reser- ves the right to retain a portion of the excess contributions for self - funding such excess and/or aggregate protection. 7. The Fund has contracted to supply loss control services to the Employer Members to assist them in following a plan of loss control that may result in reduced losses. The Contractor shall provide all of the ser- vices as provided in the Service Contract entered into by and between the Contractor and the Fund on behalf of the Employer Member. The Em- ployer Member agrees that it will cooperate in instituting any and all reasonable safety regulations that may be recommended for the purpose of eliminating or minimizing hazards that would contribute to workers' com- pensation losses. In the event that the recommendations submitted by the Contractor on behalf of the Fund seem unreasonable, the Employer Member has a right to appeal to the Board of Trustees. The Board shall hear the objections of the Employer Member at its next regularly scheduled meeting and its decision will be final and binding on all parties. Any Employer Member who does not agree to follow the decision of the Board shall be withdrawn from the Fund immediately. 8. The Employer Member agrees that it will appoint a Workers' Compensation Coordinator of department head rank, and that the Fund shall not be re- quired to contact any other individual except this one person. Any notice to or any agreements with the Workers' Compensation Coordinator shall be binding upon the Employer Member. The Employer Member reserves the right to change the coordinator from time to time by giving written notice to the Fund. 9• The Fund, through the TML Staff and the Contractor, agrees to handle any and all claims after notice of injury has been given, to prepare all required Industrial Accident Board forms, and provide a defense. The Employer Member hereby appoints the TML Staff and the Contractor as its agents '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 in such defense. ' February 5, 1987 The Fund shall be responsible for seeing that all negotiations are car- ried on with the injured employee and his attorney at the prehearing conference and that negotiations are within authority previously granted by the Fund. If a personal appearance by the employer or a co -employee is necesary, the expense of this appearance will be paid by the Employer Member. With the advice and consent of the Fund, the TML staff and Con- tractor will retain and supervise legal counsel on behalf of and at the expense of the Fund necessary for the prosecution of any litigation. All decisions in individual cases shall be made by the Fund through the TML Staff and the Contractor, which includes the decision to appeal or not to appeal an Industrial Accident Board's final ruling and decision. However, any Employer Member shall have the right in any case involving one of its employees, to consult with the Fund on any decision made by the TML Staff or the Contractor. The Board shall hear the objections of the Employer Member at its next regularly scheduled meeting and its decison will be final and binding on all parties. Any suit brought or defended by the Contractor and the Fund shall be in the name of the political subdivision. Notwithstanding any provisions of this para- graph, all reports and filings required by the Workers' Compensation Law and the Industrial Accident Board of any employer will be the respon- sibility of the Employer Member. It is further understood that this Agreement does not cover discrimination suits under Article 8307c. There shall be supplied quarterly to each Employer Member a computer printout involving a statement of claims, claims status, and activity report cumulative for each Fund Year. 10. The Employer Member acknowledges that it has received a copy of the By- laws of the Fund and agrees to abide by the Bylaws and any amendments thereto. 11. The Fund agrees that all Fund transactions will be annually audited by a nationally recognized certified public accounting firm. 12. The Fund is responsible for the filing of all necessary tax forms with the Internal Revenue Service. 13. The Employer Member executing this Agreement shall designate in the fol- lowing space the seating capacity of any aircraft presently owned or leased by that Employer Member. Further, the employer Member agrees to notify the Fund within fifteen (15) days if any new aircraft are pur- chased or leased during the term of this Agreement, and the seating capacity of said newly acquired aircraft. February 5, 1987 14. The Fund agrees to provide a complete range of program management and MIS services to include, by way of example, but not of limitation, the following: a. Claims printouts rendered monthly and keyed by designated Employer Member functions or departments. b. Breakdown of payments made by compensation or medical. c. Monthly billing statements for reimbursement of current payments plus Contractor fees. d. Maintenance of loss and payroll statistics for determination of the City's experience modifier under the experience rating plan. 15• The Employer Member further agrees to hold the Fund harmless from any and all claims (including attorney fees) that may be asserted against the Fund for the non-payment of any claims due to the failure of the Employer Member to maintain adequate reserves for the payment of claims. In witness whereof, the parties hereunto set their hands by their representa- tives thereunto duly authorized this day of TO BE COMPLETED BY THE FUND MEMBER: Name of Fund Coordinator (See paragraph 8): Rod Bouffard Title Assistant Director of Finance Mailing Address P.O. Box 2000 City Lubbock Zip 79457 Phone (806) 762-6411 Signature of Authorized City Official Mayor February 20, 1987 Title Date TO BE COMPLETED BY THE FUND: Effective Date of this Agreement 10/01/86 City Name Lubbock Contract Number A0263 Signature of Authorized Fund Official Title Date i February 5, 1987 Exhibit A Texas Municipal League Workers' Compensation Joint Insurance Fund Addendum to Interlocal Agreement Lubbock Contract #A0263 Effective Date: 10/1/86 Expiration Date: 9/30/87 1. The amount of the escrow account described fully in section 5 of this Interlocal Agreement for the annual period referenced above shall be $46,439. 2. The administrative fee shall be calculated at an annual amount of 2.5% of standard premium, or $22,537. k 3. It is mutually agreed that the fees payable for services outlined in sec- tion 5 of this Interlocal Agreement shall be based on the following schedule: Claims MIS Loss Control Payroll Audits $ 37.00 medical only $263.00 indemnity $130.00 pre -hearing $ 15.00 report only $ 45.00 rehabilitation $ 10.85 per claim $ 69.00 per hour $ 42.00 per hour