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retrospective review at stated periods after the end of each policy year to develop the net cost for liability insurance to the City. If losses were high, the City was required to pay up to 140% of the deposit premium, subject to review; a good record being possible to reduce cost to 35% of the deposit premium, and to insure that the City does not pay more than the deposit premium, stop -loss insurance was carried with Lloyds of London, costing $5,100 per year. He further reported, based on $40,608 incurred losses during 1965-66, the total retrospective premium cost was $56,642 while the initial deposit premium was $34,808, an increase of $21,834, $7,911 of which would be absorbed by CNA and $13,923 absorbed by Lloyds of London under City's stop -loss policy. He further advised that City must, however, first pay CNA the $13,923 and then file a claim for reimbursement from 4oyds, hence need to transfer funds requested by resolution to make funds immediately available, and proposed appropriation of same amount by ordinance to reimburse account from which transfer proposed in the interim. Councilman Granger questioned reason for amount of surplus funds being available in the Street Department proposed for this transfer. City Manager advised funds not surplus in this Department but that street program had not yet been started for their construction period and funds would be needed to be reimbursed as recommended. Councilman Bury moved to adopt RESOLUTION NO. 5333 TRANSFERRING $133923 FROM APPROPRIATION FOR MATERIAL, SUPPLIES AND SERVICES FOR STREET MAINTENANCE TO APPROPRIATION FOR NON -DEPARTMENTAL EXPENSES TO PROVIDE FOR PAYMENT OF RETROSPEC- TIVE COMPREHENSIVE LIABILITY INSURANCE PREMIUMS seconded by Councilman Keckley. On question, Councilman Bury asked if "stop loss" had not been substantially increased and was advised by City Manager it was true and doubt existed whether City could get it again at all. Councilman Bury also asked whether it was advisable to consider setting up a fund for self-insuraing on "stop -loss" or if $13,000 to be reimbursed should not be set in a reserve for an over -premium. City Manager advised Staff did not feel City in a position as yet to go on a self-insuring basis. Auditor -Accountant advised a study was being made on this "stop -loss" policy, expiring in 1968, and a recommendation would be made to Council on City's comprehensive liability insurance and whether to keep this type of insurance. (Memo 4/4/67) Councilman Bury again questioned advantage of holding a reserve and if a re -rating of policy was to be made. Auditor -Accountant stated he could not see advantage of a reserve and that a re -rating of policy would be made next year. Mayor Hezk ner asked whether Lloyds of London could cancel this policy before next year and was advised by Auditor -Accountant this was possible. Councilman Henderson questioned balance of Budgeted Reserve and was advised by Auditor -Accountant some $38,000 in reserve at this time. Councilman Bury expressed hope initiation of safety programs would helpreduce claims. Motion carried on roll call vote, Councilman Rosselli being noted absent. APB 3 '67