HomeMy WebLinkAbout4/18/2023 Item 6b, Domini and Auslen - Staff Agenda CorrespondenceCity of San Luis Obispo, Council Memorandum
City of San Luis Obispo
Council Agenda Correspondence
DATE: April 17, 2023
TO: Mayor and Council
FROM: Nickole Domini, Human Resources Director
Prepared By: Kate Auslen, Risk Manager
VIA: Derek Johnson, City Manager
SUBJECT: ITEM 6B. 2023-25 FINANCIAL PLAN – STRATEGIC BUDGET
DIRECTION AND MAJOR CITY GOAL WORK PROGRAM REVIEW
After the release of the Council Agenda Report, it was noticed that Recommendation #3
and the “CJPIA Excess Protection Program for Workers’ Compensation Coverage”
section in the staff report were incorrect. Please see the corrected recommendation and
CJPIA sections in highlight and strikethrough below.
Recommendation:
1. Review the strategic budget direction report (Attachment A); and
2. Provide feedback and guidance to the City Manager regarding the recommended
strategic budget direction and proposed budget allocations to commence budget
adoption on June 6, 2023; and
3. Authorize participation in the Excess Protection Program (EPP) for wo rkers’
compensation coverage.
a. Authorize the City Manager to accept a Memorandum of Coverage (MOC),
when finalized, from California Joint Powers Insurance Authority (CJPIA) for
the Excess Protection Program for workers’ compensation coverage and
execute any necessary documentation to enroll in that program. As an
example, an existing MOC with CJPIA is attached as Attachment B.
b. Adopt a resolution entitled, “A Resolution of the City Council of the City of
San Luis Obispo, California, to Authorize and Approve pooling of Self -
Insurance through the Excess Workers’ Compensation Protection Program
of the California Joint Powers Insurance Authority” (Attachment C
Attachment B). This includes contemporaneous execution by the Mayor of
an application for a Certificate of Consent, from the California Departmen t
of Industrial Relations, for the City to self-insure workers’ compensation
liabilities, Attachment D a copy of which is attached as an Exhibit to the
Resolution.
c. Authorize the City Manager to execute an agreement with Athens
Administrators for third party administration services for the workers’
compensation program.
Item 6b. 2023-25 Financial Plan Strategic Budget Direction Page 2
CJPIA Excess Protection Program for Workers’ Compensation
Coverage (Attachments B,C, and D Attachment B)
The City of San Luis Obispo became a member of the California Joint Powers
Insurance Authority (CJPIA) on July 1, 2004, for liability and workers’
compensation coverage. At that time, the only option available was the primary
program, where coverage was provided on a “first dollar” basis and member
agencies shared the risk and cost of claims by pooling their losses. In 2016, CJPIA
established an excess protection program (EPP), where member agencies could
choose to participate by selecting a Self-Insured Retention (SIR), or deductible,
that best fit their claims experience and tolerance for risk. During that year, the City
of San Luis Obispo moved from the primary program to the excess program for
liability with a $500,000 SIR, in exchange for a reduced memb er contribution
amount, or premium cost. This means that the City transitioned to paying claims
costs up to $500,000 before CJPIA liability coverage started paying the “excess”
costs beyond that amount.