HomeMy WebLinkAboutMinutes - Minutes - Risk Management and Worker's Compensation Trust Board - Meeting Date: 11/12/2014 (3) Minutes
Risk Management Trust Fund
Wednesday, November 12, 2014 - 6:00 PM
City Hall - Council Chambers, Room B2
5850 W. Glendale Avenue
Glendale, AZ 85301
Members Present
Tom Duensing, Trustee
John Stern, Chairman
Julie Stiak, Trustee
Ken Wixon, Trustee
Members Absent
Yvonne Knaack, Vice-Mayor and Trustee
Staff Present
Dianne Shoemake, Risk Manager
Lorena Sanchez, Risk & Safety Analyst
Nick DiPiazza, Deputy City Attorney
Jim Brown, Director, Human Resources & Risk Management
1. Call to Order
John Stern called the meeting to order at 6:06 PM.
2. Approval of September 4, 2014 Risk Management Trust Fund Board Meeting Minutes
The minutes were provided by the Trustees. Tom Duensing moved to approve the minutes as
written and it was seconded by Ken Wixon. Motion Passed.
3. Executive Session
Tom Duensing moved to enter executive session and it was seconded by Ken Wixon. Motion
passed. Nick DiPiazza updated the Board on the'status of claims in litigation and Dianne
Shoemake provided information on property damage claims and status of claims involving
excess insurance. No action taken. Tom Duensing moved to exit executive session and return
to open session, which was seconded by Ken Wixon. Motion passed.
4. Discussion of Risk Management Trust Fund 2014/15 Revenue and Expenses
Risk Management provided a spreadsheet of the Risk Management Trust Fund 2540 for fiscal
year 7/1/2014Ithrough 7/1/2015. It was reported for this fiscal year total revenue as of 10/31/14
is $638,179. The revenue currently received is broken down by$2,508 for interest income,
$7,018 for stadium security fees, $3,279 for miscellaneous revenue (subrogation
reimbursements) and $625,375 for self-insurance premiums. Please note that the department
self-insurance premiums for October and November have not yet been deposited into the Fund.
This would add an additional $416,917 of revenue or a total of$1,055,096.
As of 10/31/14 total expenses paid are $1,252,175. Of that amount$215,680 is for payment of
professional and contractual fees (brokerage and insurance premiums), $6,976 for
administrative costs and $1,029,519 insurance claims.
The ending fund balance is $2,629,663. The actuary's projected ending balance at the 55%
confidence level is $3,166,829. The fund balance has dropped below the confidence level by
$537,166. Once the October and November department insurance premiums are deposited, the
difference would be$120,249. Risk Management believes that as each month's department
insurance premiums are deposited, the fund will balance out at the 55% confidence level.
Reminder that included in the revenue projection for this fiscal year is an additional $650,000 for
deposit above the premiums charged to departments. This additional money is budgeted for the
next three fiscal years to increase the fund's minimum balance. This amount is subject to
Council approval during the budget process.
Risk Management has not yet begun charging all administrative costs to the trust fund, which will
increase expenses. This is not an expense that was previously included in the costs that were
analyzed by the actuary. In conversations, the actuary felt that the administrative expenses
would not affect the minimum confidence level significantly. The actuary will be analyzing all
additional costs that now can be charged to the fund due to the city code changes. Risk
Management is currently working with the actuary on the actuarial analysis. The actuary will
provide projections for the current fiscal year and the 2015/16 fiscal year.
The Fund has seen a significant increase in City property damage claims. Previously these
types of claims were paid by the departments out of their maintenance budgets. With the
change in the City Code, all property damage claims are now for the account of the Trust Fund.
The City suffered an approximate$2M loss from the 9/8/14 storm, a $250,000 loss from the
9/27/14 storm and $400,000 loss from the 7/13/14 Fire. Risk Management is working with the
departments to obtain all the documentation for submission to insurance for reimbursement. No
Action taken.
5. No new business.
6. Adjournment
Tom Duensing moved to adjourn the meeting which was seconded by Julie Stiak. The meeting
was adjourned at 6:29 PM.
Submitted by:
Dianne Shoemake