HomeMy WebLinkAbout1979-03-20; City Council; 5561-1; Workmen's Compensation InsuranceCITY OF CARLSBAD y
AGENDA BILL NO. ^
DATE:
Initial:
March 20, 1979 Atty>
DEPARTMENT:City Manager C. Mgr. "K.j
Su ject:WORKMEN'S COMPENSATION INSURANCE
(Closing Bill -. State Fund Workmen's Compensation)
Statement of the Matter
In September 1978, Council authorized staff to engage R. L. Kautz
Company to administer a self-insurance plan for Workmen's Compen-
sation. This decision has been implemented and as a result notice
was sent to cancel our Workmen ' s Compensation Insurance with State
Fund .
State Fund has now sent us an audited closing bill in the amount
of $308,898.00. Of this amount, $236,916.03 was for premium due
for the period 7-1-77 to 7-1-78, resulting from an audit of the
City payroll by the State Compensation Insurance Fund. An addi-
tional premium of $71,981.99 was charged by State Fund for the
period 7-1-78 to 8-31-78, plus the short rate cancellation cost.
Summary:
Premium 7/1/77 - 7/1/78 $236.916.03
Premium 7/1/78 - 8/31/78 34,788.82
Penalty for short rate cancellation 37,192.97
Total $308,897.82
Staff has checked the audit and finds it correct.
This premium is considerably more than was projected for insurance
and bonds in the budget for 1978-79 and will require the transfer
of $236,916 from Unappropriated Reserves to the Insurance and Bond
Fund for expenditures during the balance of fiscal year 1978-79.
Exhibit
Resolution No. ^T 7 /(t>_
Memo to City Manager dated 3-15-79
Recommendation
Council adopt Resolution No.
funds .
Council Action:
authorizing transfer of
3-20-79 Council adopted Resolution 5716, authorizing the transfer of funds
for Workmen's Compensation Insurance.
DATE: MARCH 15, 1979
TO: CITY MANAGER
FROM: Assistant City Manager
SUBJECT: WORKMEN'S COMPENSATION INSURANCE
(Closing Bill - State Fund Compensation Insurance)
On September 1, 1978 by Council action, the City became
self-insured and we, therefore, cancelled our Workmen's
Compensation Insurance with State Fund Compensation
Insurance.
We have now received our closing bill for 7-1-77 to 7-1-78
in the amount of $236,916, the audit for July and August,
1978 in the amount of $34,788, and the charge for short
rate cancellation in the amount of $37,193. Any insured
cancelling a policy prior to the expiration date is subject
to this short rate cancellation charge which is levied by
all insurers. Under State Fund Compensation Insurance we
have paid monthly payments amounting to $84,000 a year,
An audit is made to determine actual payroll, a factor is
then arrived at and applied to the payroll which produces
the audit amount charged. In my mind the charges by State
Fund reaffirm the economic necessity for self-insurance.
Funds were budgeted in the Insurance Account for Fiscal
Year 1978-79, however, because of the charges incurred in
cancelling State Fund Compensation Insurance, it is necessary
to transfer $236,916 from Unappropriated Reserves to the
Insurance and Bond Account to ensure a satisfactory reserve
to pay future claims.
Of
WILLIAM C. BALDWIN
Assistant City Manager
WCB:ldg
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RESOLUTION NO. 5716
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF CARLSBAD, CALIFORNIA, AUTHORIZING
THE TRANSFER OF FUNDS FOR WORKMEN'S COMPEN-
SATION INSURANCE.
BE IT RESOLVED by the City Council of the City of Carlsbad
as follows:
1. That the transfer of two hundred thirty-six thousand,
nine hundred and sixteen dollars ($236,916) for Workmen's Compen-
sation Insurance be made from Unappropriated Reserves to the
Insurance and Bond Account is hereby authorized and approved.
2. That Department of Finance Fund Transfer No. 26
on file in said department and incorporated by reference herein
is approved.
PASSED, APPROVED AND ADOPTED by the City Council of the City
of Carlsbad at a regular meeting held on the 20th day of
March , 1979, by the following vote, to wit:
AYES: Councilmen Packard, Skotm'cki, Anear, Lewis and
Council woman Casler
NOES: None
ABSENT: None S^~~^ / /^~-^ ' /?
J[t,/S^rt'^*st'2{/(^ ^-^^f. /t-tc't^
RONALD C. PACKARD, Mayor
«
ATTEST:
dJ,j&L ^.^^^^^^
ALETHA L. RAUTENKRANZ, City Cl/Srk
(Seal)