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HomeMy WebLinkAboutC-8972-2 - Joint Powers AgreementJOINT POWERS AGREEMENT FOR CALIFORNIA INSURANCE POOL AUTHORITY 114695.000000/708740.05 TABLE OF CONTENTS JOINT POWERS AGREEMENT FOR CALIFORNIA INSURANCE POOL AUTHORITY Page ARTICLE 1. DEFINITIONS...................................................................................................... l ARTICLE 2. SEPARATE ENTITY........................................................................................... 2 ARTICLE3. PROGRAM........................................................................................................... 3 ARTICLE4. CIPA POWERS.................................................................................................... 3 ARTICLE 5. MEMBERS; BOARD OF DIRECTORS.............................................................. 3 ARTICLE 6. POWERS OF BOARD......................................................................................... 4 ARTICLE 7. MEETINGS OF THE BOARD............................................................................ 4 ARTICLE 8. QUORUM; VOTING........................................................................................... 4 ARTICLE 9. EXECUTIVE COMMITTEE............................................................................... 4 ARTICLE10. CIPA FUNDS....................................................................................................... 5 ARTICLE 11. TERM OF AGREEMENT.................................................................................... 5 ARTICLE 12. MEMBERSHIP TERM; WITHDRAWAL; TERMINATION ............................ 5 ARTICLE 13. DISPOSITION OF CIPA PROPERTY AND FUNDS ........................................ 6 ARTICLE 14. ENFORCEMENT AND DISPUTE RESOLUTION ............................................ 6 ARTICLE 15. INVALIDITY....................................................................................................... 7 ARTICLE16. AMENDMENTS.................................................................................................. 7 ARTICLE 17. LIABILITY OF BOARD OF DIRECTORS, OFFICERS, AND COMMITTEEMEMBERS................................................................................. 7 ARTICLE18. BYLAWS.............................................................................................................. 8 ARTICLE 19. PROHIBITION AGAINST ASSIGNMENT........................................................ 8 ARTICLE 20. LIABILITY TO THIRD PARTIES...................................................................... 8 ARTICLE 21. AGREEMENT COMPLETE................................................................................ 8 ARTICLE 22. DATE AGREEMENT EFFECTIVE.................................................................... 8 114695.000000/708740.05 JOINT POWERS AGREEMENT FOR CALIFORNIA INSURANCE POOLAUTHORITY This Agreement is entered into pursuant to the provisions of Chapter 5 (beginning with Section 6500) of Division 7 of Title 1 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 1 of the Government Code. WITNESSETH: WHEREAS, the public interest requires and it is in the mutual interest of the parties hereto to join together to establish and operate a cooperative program of risk management; and WHEREAS, 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 WHEREAS, 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 WHEREAS, 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 WHEREAS, 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, reinsurance 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 from and in consideration of the execution of this Agreement by other local public entities, each of the parties hereto does agree as follows: 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 California Insurance Pool Authority," as it may be amended. (b) "Authority" or "CIPA" shall mean the California Insurance Pool Authority created by this Agreement. -1- 114695.000000/708740.05 (c) "Board of Directors" or "Board" shall mean the governing body of the Authority. (d) "Claim" shall mean a claim made against a member arising out of an occurrence, incident or other event which is covered by an excess or primary insurance program of the Authority in which the Member participates. (e) "Current Member" shall mean a Member Agency that has not been terminated or withdrawn from the Authority or any program thereof. (f) "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. In the case of new areas of risk that CIPA is considering, "Eligible Members" shall be all Members who reasonably expect to participate in that area of risk. (g) "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. (h) "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. (i) "Insurance program" or "program" shall mean a program of the Authority under which participating Members are protected against designated losses through joint purchase of primary or excess insurance, pooling of self -insured claims or losses, purchased insurance or any other combination or method as determined by the Board. The Board of Directors or the Executive Committee may determine applicable criteria for determining eligibility for any insurance program, as well as establish program policies and procedures. 0) "Local Public Entity" shall mean city, county, public authority and such other governmental entities as the Authority may determine to be qualified to participate in the Authority. (k) "Member Agency" or "Member" shall mean a Local Public Entity that is a party to this Agreement. (1) "Participation" or "Participating" shall mean a Member Agency's action or state of taking part in the programs of the Authority. (m) "Risk Management" is the process through which exposure to loss is identified, the feasibility of alternatives evaluated, the best risk management techniques are selected and implemented, and the selected program(s) monitored and improved upon. Risk management techniques may include, but not be limited to, loss prevention and reduction, transferring losses, self-insurance, pooling, commercial insurance, and other funding mechanisms. ARTICLE 2. SEPARATE ENTITY There is hereby created a separate public entity, the full legal name of which shall be "California Insurance Pool Authority", and may be referred to herein as "CIPA" or the 114695.000000/708740.05 _2_ "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. PROGRAM A risk management program is hereby established by the parties to this Agreement. This cooperative program of Risk Management, which may include the joint purchase of primary or excess insurance, pooling of self -insured claims or losses, or purchased insurance, shall include liability coverage, and may include any or all the following risk areas: worker's compensation, accident and health, property damage and such other areas as agreed upon by the Board. ARTICLE 4. CIPA POWERS (a) CIPA shall have the power and the duty to establish and operate a program of risk management and provide for its execution either directly by CIPA or by contract. (b) CIPA 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 reinsurance, 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 and consulting services. (c) The operations of CIPA shall be subject to, and 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 the powers of a general law city. ARTICLE 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 CIPA and upon acceptance by the Board by two-thirds vote, and subject to acceptance by the prospective member of the financial arrangements, fund contributions and such other conditions as may be specified by the Board, consistent with this Agreement. (c) Each Member Agency shall be entitled to one voting representative to serve as a director on the Board. 114695.000000/708740.05 _3 _ (d) Each Member Agency shall designate a representative to the Board. Each Member may designate one alternate to attend meetings and vote in the event of absence of the representative. To be qualified to serve, each representative and alternate shall be an officer or employee of the appointing Member Agency. ARTICLE 6. POWERS OF BOARD The Board shall exercise all powers and conduct all business of the Authority, either directly or by delegation to other bodies or persons unless otherwise prohibited by this Agreement including, but not limited to, the following powers and functions: (a) To approve an annual budget and any assessments of the Authority. (b) To select officers, including a treasurer, auditor, and secretary, as may be necessary to carry out the purposes of this Agreement. (c) To establish committees as it may deem necessary to carry out its purposes. (d) To exercise all of the powers and duties of CIPA, including all business assigned to the Executive Committee, in the absence of the Executive Committee. (e) To approve all changes to the Bylaws. This authority may not be delegated. (f) To perform such other duties and functions as are provided for in this Agreement. 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 Roberts 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 Board of 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 Eligible Member may vote on each matter brought before the Board for decision. ARTICLE 9. EXECUTIVE COMMITTEE The Board shall establish an Executive Committee of the Board of Directors as provided in the Bylaws. The Executive Committee shall exercise general supervisory and policy control 114695.000000/708740.05 _4_ 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. ARTICLE 10. CIPA FUNDS The Treasurer of the Authority shall receive and receipt for all of the funds of CIPA. The treasurer of a Member Agency shall be the Treasurer and Auditor of CIPA unless another Treasurer or Auditor is designated by CIPA. The Treasurer will cause an annual audit of the financial affairs of CIPA to be made by a certified public accountant at the end of each fiscal year in accordance with generally accepted auditing principles. Except for those duties prescribed by Government Code sections 6505 and 6505.5, the Treasurer's selection, responsibilities, compensation and related matters shall be governed by the Bylaws. The Treasurer shall be the disbursing officer of CIPA and shall draw warrants against the funds of CIPA in the treasury when demands are presented and authorized as designated in the Bylaws. The Treasurer and any other person authorized to be in charge of any CIPA funds shall be bonded. 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 that this Agreement and CIPA shall continue to exist for the purpose of disposing of all claims, distributing assets and performing all other functions necessary to wind up the affairs of CIPA. The Executive Committee shall be vested with all powers of CIPA for the purpose of winding up and dissolving the business affairs of CIPA. ARTICLE 12. MEMBERSHIP TERM; WITHDRAWAL; TERMINATION (a) A party to this Agreement shall remain a Member Agency for two years from the date it first joined CIPA; thereafter the Member Agency may withdraw by giving written notice to the Board or its designee, on or before the next succeeding March 1, of the intent to 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 be a Member of CIPA; however, the withdrawing party shall remain responsible to contribute its share of premiums, contributions or assessments, as described in Article 13, and shall continue to comply fully with the terms and conditions of this Agreement and programs in which they were participants. Withdrawal of a party from CIPA shall automatically concurrently terminate any and all coverages obtained by and through CIPA as to the withdrawing party and all additional insureds and named insureds affiliated with the withdrawing party, excepting only: (1) commercial insurance policies specifically naming the withdrawing party or related insureds; (2) tail or extended reporting coverage offered by CIPA and accepted by the withdrawing party; (3) pending covered claims; 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 2/3 vote of the entire Board of Directors; provided that a reasonable time shall be afforded, in the discretion of the Board of Directors, for the Member to seek coverage elsewhere. 114695.000000/708740.05 _ 5 _ (d) The Executive Committee shall have the right to recommend termination of any Member Agency's participation in the Authority, or any program thereof, in the event of nonpayment of any of the Member Agency's obligations. Such a recommendation may be approved by a majority of the entire Board of Directors. ARTICLE 13. DISPOSITION OF CIPA 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 in connection with final termination of a program pursuant to subparagraph (b). The withdrawal or cancellation of any Member Agency shall not terminate its responsibility to contribute its share of premium or funds to any insurance program of CIPA or to cooperate with CIPA 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 determination of the final amount of 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 CIPA or the complete rescission or final termination of the Joint Powers Agreement by all of the then parties thereto, or final termination of any program by CIPA, any assets of CIPA 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 for 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 CIPA based on their total net contributions from inception, determined as of the date of dissolution, rescission or final 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 contributions 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 AND DISPUTE RESOLUTION CIPA shall have the authority to enforce this Agreement. Any dispute regarding the interpretation of this Agreement, the Bylaws, a Memorandum of Coverage, or any other CIPA documents, or the collection or return of funds, between or among CIPA and any Member Agency or Agencies, shall be addressed in accordance with the administrative procedures established by CIPA. If unresolved, any such disputes shall then submitted to final and binding arbitration, except in the case of a dispute exclusively for the collection or return of assessments, contributions or premiums for a given year of coverage. However, where there is a coverage dispute between CIPA and any Member Agency or Agencies between such Member Agency or Agencies and one or more third party insurance providers concerning the same common nucleus 114695.000000/708740.05 _6_ of operative facts, the Member Agency or Agencies may request, and the Board of CIPA may, in its sole, reasonable discretion, approve or conditionally approve waiver of these dispute resolution procedures to permit adjudication of the disputes in a single forum. Such arbitrations shall be conducted 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, and such other procedural rules as the CIPA Board may establish. The decision of the arbitrator(s) may be entered as a judgment in any court of the State of California or elsewhere. Cost of such arbitration proceedings shall be allocated by the arbitrators. As to disputes exclusively for the collection or return of assessments, the Authority may sue, or any affected Member may sue provided it has timely presented a claim therefore 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 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. ARTICLE 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 Agreement. This Agreement may be executed in one or more counterparts, and shall be deemed effective as to all signatories as though signed in one document. Reasonable prior notice of any Board meeting in which amendments are to be voted upon must be given to each Member in writing. Such notice must include mention of the nature of the amendments to be voted upon. Any party that has failed to approve an amendment which has become effective shall be bound by such amendment. ARTICLE 17. LIABILITY OF BOARD OF DIRECTORS, OFFICERS, AND COMMITTEE MEMBERS (a) To the extent permitted by law, the Authority shall defend and indemnify a Director, Officer or committee member of CIPA for a claim which is based on, or arises out of, activities undertaken in good faith and within the course and scope of his or her duties, as such. (b) The cost of defense and indemnity of a Director, Officer or committee member of CIPA shall be a proper charge against the funds of the Authority, except as to those claims arising as a result of such persons traveling to or from a meeting of the Authority, it being the intent of the parties that the risks of such travel be borne by the Member Agency. No Director, Officer or committee member shall be required to give a bond or other security to guarantee the faithful performance of their duties pursuant to this Agreement. Nothing herein shall limit the right of the Authority to purchase insurance, bonds or master bonds to provide coverage within the scope of this Article. 114695.000000/708740.05 _7_ ARTICLE 18. BYLAWS (a) By a two-thirds vote of the entire Board, the Board shall develop and adopt Bylaws to govern the operations of CIPA and may amend such document. (b) Each Member Agency agrees to comply with and be bound by the provisions of the Bylaws as may be amended. Notwithstanding any provision in the Bylaws adopted by the Board, in the event of any conflict between this Agreement and the Bylaws this Agreement shall prevail. ARTICLE 19. PROHIBITION 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. ARTICLE 20. LIABILITY TO THIRD PARTIES Pursuant to Government Code section 6512.2, no Member Agency shall be liable to any third party for CIPA's conduct in carrying out the purposes of this Agreement. The Member Agencies hereby declare that CIPA is a member of the Authority and shall at all times participate in the liability insurance program of the Authority. The Member Agencies further direct the Board of Directors to at all times maintain insurance or reinsurance to cover the operations of the Authority as the Board, in its discretion, shall deem appropriate. Notwithstanding the availability of any such coverage, the assets of CIPA shall be available to satisfy the liabilities of CIPA. ARTICLE 21. AGREEMENT COMPLETE The foregoing constitutes the full and complete Agreement of the parties. There are no oral understandings or agreements not set forth in writing herein. ARTICLE 22. DATE AGREEMENT EFFECTIVE This Agreement shall become effective as of July 1, 2007 upon approval in accordance with its terms. 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 VVWII , 2022 C pPpRc�-EYF� F N,SO GE NcA 114695.000000/708740.05gy.n c i Attorney r CITY OF NEWPORT BEACH By