RES-9353 Amendment Approval for Joint Powers Agreement for Orange County Cities Risk Management AuthorityRESOLUTION NO. 9353
A
RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF ORANGE APPROVING AMENDMENT OF THE
JOINT POWERS AGREEMENT FOR THE ORANGE
COUNTY CITIES RISK MANAGEMENT AUTHORITY.
WHEREAS,
the City of Orange ("City") is a member of the Orange County Cities Risk
Management Authority ("Authority"); and WHEREAS,
the Board of Directors of the Authority has approved changes to the joint powers
agreement under which the Authority operates, in order to delegate management of certain
affairs of the Authority to its Executive Committee, conform the agreement to the changes
in the coverage contract, and to conform the agreement to current practices; and WHEREAS,
the City Council has reviewed the proposed changes and concurs that amendment
of the Joint Powers Agreement would be in the best interest ofthe City of Orange.NOW,
THEREFORE, BE IT RESOLVED by the City Council of the City of Orange that
the amended Joint Powers Agreement for the Orange County Cities Risk Management Authority,
attached as Exhibit "A" hereto, be approved.BE
IT FURTHER RESOLVED that the Mayor is hereby directed and authorized to execute
the Agreement and to forward a duly executed a copy of said Agreement forthwith to the
Clerk ofthe Authority.ADOPTED
this 14th day of November, 2000.
ATTEST:1l4dA~
d- &:td4~Cassandra
J. cMI{cart, City Clerk of the City of Orange I
hereby certify that the foregoing Resolution was duly and regularly adopted by the City
Council of the City of Orange at a regular meeting thereof held on the 14th day of November,
2000, by the following vote:AYES:
NOES:
ABSENT:
ABSTAIN:
COUNCILMEMBERS:
COUNCILMEMBERS:
COUNCILMEMBERS:
COUNCILMEMBERS:
SLATER,
MAYOR COONTZ, SPURGEON NONE
MURPHY,
ALVAREZ NONE
4-
C;~;IUAUX Cassandra
J. C~cart, City Clerk of the City of Orange Reso.
No.
9353 2
17.141266.2
JOINT POWERS AGREEMENT
FOR
ORANGE COUNTY CITIES RISK MANAGEMENT AUTHORITY
EXHIBIT I
TABLE OF CONTENTS
JOINT POWERS AGREEMENT FOR
ORANGE COUNTY CITIES RISK MANAGEMENT AUTHORITY
Page
ARTICLE 1.. Definitions.................... .................... ..................... ..................... 1 r--"
ARTICLE 2. Separate Entity...... ........ .......... .... ... ... ....... ..... ......... .,. ...... .... .,. ......3
ARTICLE 3. System Established ................. .................................. ............ .........3
ARTICLE 4. OCCRMA Powers ........................................................................ 3
ARTICLE 5. Members; Board of Directors .......................................................... 4
ARTICLE 6. Powers of Board.................................... ... ........ .., ...................... ...4
ARTICLE '7. Meetings of the Board.................................................................... 5
ARTICLE 8. Quorum; Voting ...........................................................................5
ARTICLE '9. Executive Committee .... .,. ............ ....... ................................... ..... ...5
ARTICLE 10.0CCRMA Funds... ..... .... ...... ......,. ....... ...... .......... ......... ................5
ARTICLE 11. Term of Agreement......... .............................................................. 5
ARTICLE 12. Membership Term; Withdrawal; Termination....................................... 6
ARTICLE 13. Disposition of OCCRMA Property and Funds....................................... 6
ARTICLE 14. Enforcement.. . . . . . ., . .. ., . . . . . . ... . . .. ... .. .. .. . .. ... ... .. .. . .. . . . . .. . .. .. . . . . . . . . . . . . . . . .. 7
ARTICLE 15. Invalidity.... ............. ..... ............. ....................... .......................... 7
ARTICLE 16. Amendments... .... .... .......... .... .... ........ ......., ......... ........ .......... ........7
ARTICLE 17. Bylaws and Plan Document............................ ..................................
8
ARTICLE 18. Prohibition Against Assignment ........................................ ............. ....8
ARTICLE
19. Tort Liability ............ ........ ....... ..... ... .... ..... ... ........ ............ ... ..........8 ARTICLE
20. Agreement Complete......................... ............................................9 ARTICLE
21. Date Agreement Effective. .................. ......................... ...................9 11
1 .'H:::~ .,1-
JOINT POWERS AGREEMENT
FOR
ORANGE COUNTY CITIES RISK MANAGEMENT AUTHORITY
I"'"
This Agreem~nt is entered into pursuant to the provisions of Chapter 5 (beginning with
Section 65(0) of Division 7 of Title I of the Government Code authorizing specified local
public entities to exercise jointly the power to provide Risk Management, including insurance,
pursuant to the provisions of Chapter 3 (beginning with Section 989) of Part 6 of Division 3.6
of Title I of the Government Code.
WITNESSETH:
HEREAS, the public interest requires and it is to the mutual interest of the parties
hereto to join together to establish and operate a cooperative program of risk management; and
HEREAS, the operation of such a cooperative program is of such magnitude that it is
necessary for the parties to this Agreement to join together to accomplish the purposes
hereinafter set forth; and
HEREAS, each of the local public entities which is a party to this Agreement has the
power to establish and operate a program of risk management; and
VHEREAS, Title 1, Division 7, Chapter 5 of the California Government Code
authorizes the joint exercise by two or more local public entities of any power which is
common to each of them; and
VHEREAS, each of the parties to the Agreement desires to join together with the other
parties for the purpose of minimizing risk through any, all or any combination of the
following: pooling of risk, joint funding of insurance or risk reserves in any legal manner,
formation or rental of a captive insurer, establishing certain self-insured reserves against
losses and jointly purchasing insurance, excess insurance, re-insurance and administrative
services in connection with a cooperative program of
risk management;NOW, THEREFORE, for and in consideration of the mutual advantages to
be derived therefrom and in consideration of the execution of this Agreement by other
local public entities, e:ach of the parties hereto does agree
as
follows:I"'"ARTICLE
1. DEFINITIONS The following definitions shall apply to the provisions of this Agreement
and
its Bylaws:a) .. Agreement" or "Joint Powers Agreement" shall mean this "
Joint Powers Agreement for Orange County Cities Risk Management Authority," as it may
be amended from time
to time.17.141266.2 1-June
b) .. Authority" or "OCCRMA" shall mean the Orange County Cities Risk
Management Authority created by this Agreement.
c)
Authority.
Board of Directors" or "Board" shall mean the governing body of the
d} "Claims management" shall mean the process of identifying, controlling and
resolving demands by individuals. public entities or private entities to recover losses from an
insured, otherwise indemnified, or self-insured entity. Disposing of such demands
for payment requires skills in insurance, law, adjusting/investigation, loss control engineering
and general business. Claims management is the function of supervising legal,
adjusting,investigation and engineering services to resolve such
demands.e) "Eligible Member" shall mean a Member Agency eligible to vote on a
matter coming before the Board in a given area of risk, due to the Member Agency's participation
in that area of risk. [n the case of new areas of risk that OCCRMA is considering, "
Eligible Members"'- shall be all Members who reasonably expect to participate in that area of risk.
t) "Executive Committee" shall mean the committee of the Board of Directors
responsible for management of the affairs of the Authority between meetings of the Authority.
g) "General Manager" shall mean the person or entity appointed by the Board and
given responsibility for the management, administration and operation of the cooperative
programs of risk management of the Authority.
h) "Local Public Entity" shall mean city, county, public authority and such other
governmental entities as the Authority may determine.
i) "Member Agency" or "Member" shall mean a Local Public Entity that is a
party to this Agreement.
G> "Participation" or "Participating" shall mean a Member Agency's action or
state of tak:ing part in the programs of the Authority by doing any, all or any combination of
the following through the Authority with respect to one or more risk areas:
1)
2)
3)
4)
5)
6)
r ., ....'1a,::: '1
purchase of risk management administrative services;
purchase of insurance or re-
insurance;purchase of claims administration
services;contribution to designated reserve, operating and other funds or costs
as required under the Authority's
programs;payment or providing for payment of assess~nents, defense costs,
claim and judgment costs and other related costs as required by this
Agreement or the Authority's
Bylaws;participation by the payment of premiums or contributions and
entering into requisite agreements in any pooling of losses, captive
insurance progtam or other self-insurance program established and
administered by
the
Authority.June 16. 2000
I"'"
17.141266.2
k) "Rating Structure" shall mean the means by which premiums, assessments,
contributions to a fund, or allocated expenses are established for a risk area or insurance
program on the basis of conditions which affect the probability of loss.
I) "Risk Area" shall mean an area of exposure to pure risk of fInancial loss. As
used herein, this term refers to one of the following fields of exposure: worker's
compensation, public liability, accident and health, unemployment compensation, property
damage and such other areas as the Board shall agree upon.
m) "Risk Management" shall mean the process of identifying, evaluating,
reducing, sharing, transferring, and eliminating risks. Risk management includes various
methods of funding claims payments. Risk management includes elements of insurance, law,
administration, technology and general business utilized to effectively manage risks.
ARTICI..E 2. SEPARATE ENTITY
There is hereby created a separate public entity, the full legal name of which shall be
Orange County Cities Risk Management Authority", and may be referred to herein as
OCCRMA" or the .. Authority." The Authority is a public entity separate from the parties to
this Agreement. The debts, liabilities and obligations of the Authority shall not be the debts,
liabilities. or obligations of the parties to the Agreement.
ARTICLE 3. SYSTEM ESTABLISHED
A risk management system consisting of the parties to this Agreement is hereby
established. This system represents a cooperative program of risk management which may
encompass, but is not limited to, the following risk areas: public liability, worker's .
compensation, accident and health, property damag~ and unemployment compensation and
such othe:r areas as the Board shall agree upon.
ARTICI,E 4. OCCRMA POWERS
a) OCCRMA shall have the power and the duty to establish and operate a program
of risk management and provide for its execution either directly by OCCRMA or by contract.
b) OCCRMA is authorized to make and enter into contracts~ to employ agents and
employees; to acquire, construct, manage, maintain or operate any building, works or
improvements; to acquire, hold or dispose of property, liabilities or obligations; establish risk
management related lines 'of credit, to incur indebtedness, liabilities or obligations, to sue and
be sued in its own name, and to exercise all powers necessary and proper to carry out the
terms and provisions of this Agreement, or otherwise authorized by law. The foregoing
powers include, but are not limited to, those relative to contracting for excess insurance or
re-insurance, risk pooling, including formation of an owned or use of a non-
owned captive insurance company, funding of self-insurance in any legal
manner, claims administration services ,
md consulting services.3-
c) The day-to-day operations of OCCRMA shall be subject to, and
shall be governed by the Bylaws adopted by
the Board.d) The powers exercised by the Authority shall be subject to the
restrictions upon the manner of exercising such powers of a general
law city.ARTIC.LE 5. MEMBERS; BOARD
OF DIRECTORS a) Each Member Agency is entitled to the rights and privileges and is
subject to the obligations as provided for in this Agreement and
the Bylaws.b) A new Member Agency may be accepted upon application to
OCCRMA and upon acceptance by the Board by two-thirds vote, and subject to acceptance
by the prospective member of the financial arrangements and fund contributions specified by
the
then current members.1:;) Each Member Agency shall be entitled to one voting representative to
serve as a director
on the Board.d) Each Member Agency's representative shall be designated
by appointment by the member's city council or other governing body. Such governing body
may delegate the authority to appoint that member's representatives to its city manager or
other chief executive officer. Each member also may, in the same manner, appoint one alternate
who may attend meetings and vote in the event of absence of the representative.
Each representative and alternate shall be an officer or employee of the
appointing Member Agency.ARTICLE 6.
POWERS OF BOARD The Board shall have the following
powers and functions:a) To approve the annual budget of the Authority
and any assessments.b) To elect a president and vice-president, and establish
and appoint such other officers, including an auditor, clerk and treasurer, as may be necessary
or desirable to carry out the purposes of this Agreement, and to provide
therefor in the Bylaws.c:) To establish such committees as it may, from time to
time, deem necessary to carry out its purposes, including, but not limited to
underwriting and claims committees.d.) To exercise all of the powers and duties of
OCCRMA, including all business assigned to the Executive Committee, in the absence
of the Executive Committee.e) To approve all changes to theBylaws. This authority f.
Ilay not be delegated.f) To perform such other duties and functions as are
provided
for in this Agreement.7 141?RR?
ARTICLE 7. MEETINGS OF THE BOARD
The Board shall establish a time and place to hold regular meetings not less often than
annually. Meetings shall be conducted pursuant to the most current edition of Robens Rules
of Order or such other procedural rules as the Board shall adopt.
ARTICLE 8. QUORUM; VOTING
a) A quorum for the transaction of business by the Board shall consist of a
majority of the directors, or of the Eligible Members, whichever is less.
b) All matters within the purview of the Board of Directors may be decided by
majority vote of a quorum of the Board, except those matters which the Agreement or Bylaws
specify as requiring a two-thirds vote of the Board must be decided by a vote of two-
thirds of all representatives on
the Board.c) Each director may vote on each matter brought before the Board
for decision.However, if the Board by majority vote designates a particular matter as one
which pertains only to a given risk area (e.g., workers' compensation), or a specific insurance program (
e.g.,self insured pool), then only the representatives of those Eligible Members may vote
upon the matter. This limitation respecting who may vote on certain matters is not intended
to prohibit any Member from expressing its opinion as to how those qualified to vote
should vote.ARTICl,E 9.
EXECUTIVE COMMITTEE The Board shall establish an Executive Committee of the Board of
Directors which shall consist of at least three members, as provided in the Bylaws. The president of
the Board shall be aL member of the Executive Committee; the remainder of the members may
be selected as provided in the Bylaws. The Executive Committee shall exercise general
supervisory and policy control over the General Manager, and may exercise any and all powers of
the Board between Board meetings and when delegated by the Board, as provided in this
Agreement and the Bylaws. The Executive Committee shall meet at
least quarterly. .ARTICLE 10.
OCCRMA
FUNDS I"""The Treasurer of the Authority shall be the depository of the funds of
OCCRMA. The Treasurer's selection, responsibilities, compensation and related matters shall be
governed by the Bylaws. The Auditor shall be the disbursing officer of OCCRMA and shall
draw warrants against the funds of OCCRMA in the treasury when demands are presented and
authorized as designated in the Bylaws. The Board shall require the Treasurer, Auditor and
any other person de:legated charge ot OCCRMA funds, to be bonded in amounts deemed
reasonable by
the Board.ARTICLE 11. TERM
OF AGREEMENT This Agreement shall continue in effect until it is rescinded by mutual consent
of the parties or terminated by the written consent of two-thirds of all
Member Agencies; provided 7.141266.2 5-
that this Agreement and OCCRMA shall continue to exist for the purpose of disposing of allclaims, distributing assets and performing all other functions necessary to wind up the affairs ofOCCRMA. The Executive Committee shall be vested with all powers of OCCRMA for the
purpose of winding up and dissolving the business affairs of OCCRMA.
ARTICLE 12. MEMBERSHIP TERM; WITBDRA WAL; TERMINATION
a)
A party to this Agreement shall remain a Member Agency for two years fromthedateitfirstjoinedOCCRMA; thereafter the Member Agency may withdraw by giving writtennoticetotheBoardoritsdesignee, on or before the next succeeding March 1, of the intentto
withdraw as of 12:01 a.m. on the next July 1.b)
On the July 1 specified in the notice the withdrawing party shall cease to beamemberofOCCRMA; however, the withdrawing party shall remain responsible to contribute
its share of premiums, contributions or assessments, as described in Article 13, and shallcontinuetocomplyfullywiththetermsandconditionsofthisAgreementastoanyclaimsoutstanding
which are likely to involve the Authority. 'Withdrawal of a party from OCCRMA shallautomaticallyconcurrentlyterminateanyandallcoveragesobtainedbyandthroughOCCRMAastothewithdrawingpartyandalladditionalinsuredsandnamedinsuredsaffiliatedwiththewithdrawingparty, excepting only: (1) commercial insurance policies specifically namingthewithdrawingpartyorrelatedinsureds; (2) tailor extended reporting coverage offered by
OOCRMA and accepted by the withdrawing party; (3) pending covered claims that are being litigated; and (4) continuation of any coverage provided on an occurrence basis.c)
The Board shall have the right to terminate, for good cause, any Member Agency'
s participation in the Authority, or any program thereof, upon a 2/3vote of the entire BoardofDirectors; provided that a reasonable time shall be afforded, in the discretion of the BoardofDirectors, for the Member to seek coverage elsewhere.d)
The Executive Committee shall have the right to terminate any Member Agency'
s participation in the Authority, or any program thereof, upon a majority vote, in the event
of nonpayment of any of the Member Agency's obligations.ARTI(~
LE 13. DISPOSITION OF OCCRMA PROPERTY AND FUNDS a)
A Member Agency may withdraw as a Member in accordance with this Agreement
and the Bylaws, provided that no withdrawing party shall be entitled to payment or return
of any earned premium, contribution, consideration, or property paid or donated by the party
to. the Authority, or to any distribution of assets prior to final termination of this Agreement,
except pursuant to subparagraph (b). The withdrawal or cancellation of any Member Agency
shall not tenninate its responsibility to contribute its share of premium or funds to any insuram;e program of OCCRMA or to cooperate with OCCRMA in the resolution of claims,until
all claims or other unpaid liabilities covering the period the Member Agency was a participant
have been finally resolved and a detennination of the final amount of 6-
017141266.
2 June
Ifi. 2000
payments due by the Member Agency or credits for such period has been made by the
Authority.
b) In the event of the dissolution of OCCRMA or the complete rescission or final
termination of the Joint Powers Agreement by all of the then parties thereto, any assets of OCCRMA
remaining after all claims and obligations have been paid. and after the payment of all
liabilities. costs, expenses and charges incurred pursuant to this Agreement, or provision made
fOIi the payment of same through establishment of a liquidation fund, purchase of insurance
or reinsurance, or a combination thereof, shall be returned to the then current Members
of OCCRMA based on their total net contributions from inception, determined as of the
date of dissolution. rescission or fmal termination. For the purposes of this paragraph "net contributions"
shall mean the sum of actual contributions paid in, less losses and allocated claims
expenses, but not less than zero for any individual Member. Net contributions shall be reduced
by any rate credits given. Losses and allocated claims expenses shall include contribultions
used to pay for reinsurance, but not any proceeds therefrom. Net contributions shall
include any interest actually earned thereon by the Authority. The Authority may adjust the
interest earnings attributable to the contributions of a Member whose net contribution is zero
or less based on a reasonable estimate of any periods during which no interest was earned.
ARTICLE
14. ENFORCEMENT OCCRMA
shall have the authority to enforce this Agreement. Any dispute regarding the
interpretation of this Agreement or the Bylaws adopted hereunder. between or among OCCRMA
and any Member Agency or Agencies shall be submitted to final and binding arbitration
in accordance with the procedures established in the California Code of Civil Procedure
and referred to the Judicial Arbitration and Mediation Service or other arbiter as may
be agreed by the parties; except that the Authority or any affected Member may sue for the
collection or return of assessments, contributions or premiums for a given year of coveragc::;
provided that the affected member shall have first exhausted its administrative remedies
and timely presented a claim therefor to the Authority. As to such a claim. for the collection
or return of funds, the prevailing party shall be entitled to reasonable attorney's fees.
ARTICLE
15. INVALIDITY I'"
Should any portion, term, condition or provision of this Agreement be determined by a court
of competent jurisdiction to be illegal and in conflict with any law of the State of California
or be otherwise rendered unenforceable or ineffectual. the validity of the remaining portions,.
terms. conditions and provisions shall not be affected thereby.ARTICJ..
E
16. AMENDMENTS No
amendments to this Agreement shall be effective unless accomplished by written agreement
executed by the governing bodies of at least two-thirds of the parties to this
017.141266.2 7-June 16. 2000
Agreement. Reasonable prior notice of any Board meeting in which amendments are to be
voted upon must be given to each director in writing. Such notice must include mention of the
nature of the amendments to be voted upon.
ARTICLE 17 . BYLAWS AND PLAN DOCUMENT
a)
By a two-thirds vote of the entire Board, the Board shall develop and adopt
Bylaws and a Plan Document to govern the day-to-day operations of OCCRMA
and may amend such documents from time
to time.b) Each Member Agency agrees to comply with and be bound by the
provisions of the Bylaws as the same may be amended from time to time. Notwithstanding any
provision in the Bylaws or Plan Document adopted by the Board in the event of any conflict
between this Agreement and the Bylaws or Plan Document, this Agreement shall prevail; in the
event of any conflict between the Bylaws and the Plan Document, the Bylaws
shall prevail.ARTICL~: 18. PROmBITION
AGAINST ASSIGNMENT No Member Agency may assign any right, claim or interest it may have
under this Agreement, and no creditor, assignee or third party beneficiary of any Member shall
have any right, claim or title to any part, share, interest, fund, premium or asset of
the Authority.ARTICLI: 19.
TORT LIABILITY As to any debts or liabilities based upon Section 895.2 of the Government Code
of the State of California, except as otherwise provided by individual contract, pursuant
to the provisions ofSection 895.4, of the Government Code of the State of California,
this paragraph allocates such liabilities. Each Member shall be liable for its pro rata share of both
the debts and liabilities of the Authority to the extent such debts and liabilities exceed
the available assets of the Authority, including any collectible coverage or insurance, and the Member'
s pro rata share of all debts and liabilities for claims against all Members, arising out of facts: (
i) in the perfonmance of this agreement, and (ii) occurring while a Member. A Member's
pro rata share of debts and liabilities shall be calculated by dividing each such Member's (
or former Member's) total contributions paid, by the total of all contributions paid by all
such Members,from the inception of the Authority. To the extent required to achieve such
purpose, each Member indemnifies the other Participants for any loss, cost or expense that may
be imposed upon such other Members. The rules therefor as set forth in Civil Code Section
2778 are hereby made a part of this Agreement. For the purposes of this
paragraph, "contributions"shall include all funds paid to the Authority for participation in the programs of
the Authority including group excess liability insurance programs), any liability
protection programs operated on a group self-insurance basis by the Authority, and for operation
of the Authority.However, "contributions" shall not include payments made to the Authority
which are used for purch~lse of commercial insurance for other risks on
a
ARTICLE 20. AGREEMENT COMPLETE
The foregoing constitutes the full and complete Agreement of the parties. There ar~ no
oral understandings or agreements not set fonh in writing herein.
ARTICLE 21. DATE AGREEMENT EFFECTIVE This
Agreement shall become effective as of July 1, 2000 upon approval in accordance with
its tenns.IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their proper officers thereunto duly authorized.Executed
before me this day
of 2000 CITY OF BREA City
Clerk By Executed
before me this day
of 2000 CITY OF CYPRESS City
Clerk By Executed
before me this day
of 2000 CITY OF IRVINE City
Clerk By Executed
before
me this day of
2000 CITY OF LAGUNA BEACH City Clerk
By Executed before
me this 141266.2
9-June 16. 2000
day of 2000 CITY OF LA PALMA
City Clerk By
Executed before me this
day of , 2000 CITY OF LOS ALAMITOS
City Clerk By
Executed before me this
day of , 2000 CITY OF ORANGE
City Clerk By
Executed before me this
day of , 2000 CITY OF SAN CLEMENTE
City Clerk By
Executed 'before me this
day of 2000 CITY OF SEAL BEACH
City Clerk By
Executed before me this
day of 2000 CITY OF STANTON
City Clerk By
17.141266.2
Executed before me this
day of 2000
City Clerk
Executed before me this
day of 2000
City Clerk
Executed before me this
day of 2000
City Clerk
11-
CITY OF TUSTIN
By
CITY OF WESTMINSTER
By
CITY OF YORBA LINDA
By
June 16, 2000