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6.C. - Page 119 of 196
<br />CITY OF REDWOOD CITY
<br />NOTES TO THE BASIC FINANCIAL STATEMENTS
<br />For the Fiscal Year Ended June 30, 2020
<br />NOTE 13 — RISK MANAGEMENT AND SELF-INSURANCE FUND (CONTINUED)
<br />B. General Liability and Automobile
<br />The City is a member of the Bay Cities Joint Powers Insurance Authority (BCJPIA), which is an insurance
<br />pool consisting of 19 San Francisco Bay Area government agencies, which the City uses for general liability
<br />and auto liability coverage. In FY 2019-20 the City maintained a $350,000 self-insured retention with
<br />coverage from $350,000 to $1,000,000 through the BCJPIA. The purpose of the pool is to provide certain
<br />levels of liability coverage, claims administration, and loss control support to member agencies. Annually,
<br />each agency pays an actuarially -determined premium based upon a formula which takes into account loss
<br />experience, annual payroll, and population. This premium pays for administrative costs and funds liability
<br />reserves. The total premium paid in FY 2019-20 was $1,925,870.
<br />The BCJPIA belongs to the California Affiliated Risk Management Authority (CARMA) which is an
<br />excess liability pool comprised of the BCJPIA and four other local government insurance pools. CARMA
<br />provides coverage from $1,000,000 to $28,000,000. A layer from $1,000,001 to $4,000,000 is self- insured
<br />by CARMA, the layer from $4,000,001 to $28,000,000 is reinsured through agreements with commercial
<br />insurers.
<br />The City also carries all risk coverage on buildings and their contents at replacement cost value.
<br />Audited financial statements are available from the Bay Cities Joint Powers Insurance Authority at 1750
<br />Creekside Oaks Drive, Suite 200, Sacramento, CA 95833.
<br />C. Self -Insurance Fund
<br />The City maintains a self-insurance internal service fund for its workers' compensation and general liability
<br />self-insurance programs. This fund accounts for revenues from departmental charges and operating
<br />expenses, including settlements within the City's self-insured retentions. Reserves for incurred but not
<br />reported claims are maintained within this fund. These reserves are based on an actuarial analysis performed
<br />by Richard E. Sherman & Associates, Inc. in accordance with GASB 10.
<br />Changes in the self-insurance fund's claims payable liability for fiscal years ended 2018, 2019, and 2020
<br />were:
<br />Settlements have not exceeded coverage for each of the past three fiscal years.
<br />87 206
<br />Current Year
<br />Beginning
<br />Claims/Changes
<br />Claim
<br />Ending
<br />Fiscal Year
<br />Balance
<br />in Estimates
<br />Payments
<br />Balance
<br />2017-18
<br />$ 23,780,493
<br />$ 6,743,172
<br />$ (3,976,982)
<br />$ 26,546,683
<br />2018-19
<br />26,546,683
<br />6,698,913
<br />(4,030,648)
<br />29,214,948
<br />2019-20
<br />29,214,948
<br />4,642,347
<br />(4,110,398)
<br />29,746,897
<br />Settlements have not exceeded coverage for each of the past three fiscal years.
<br />87 206
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