HomeMy WebLinkAbout4000ORDINANCE NO. 4 bJO
AN ORDINANCE of the City Council of the
City of Kent, Washington, amending section
2.97.020 of the Kent City Code entitled,
"Adm1rnstrat1on of Claims," to revise procedures
for settling claims and lawsuits covered by the
city's insurers under the city's new insurance
program.
RECITALS
A. In 1980, the city Joined the Washington Cities Insurance
Agency (WCIA) as a founding member. The WCIA 1s an insurance pool,
formed by a consortium of member Washington State cities. The city
continued its membership for 30 years, leaving the WCIA at the end of
2010. On January 1, 2011, the city essentially became a stand-alone self-
insured municipal entity when 1t changed its insurance program to a
combined self-insurance/reinsurance program.
B. When part of the WCIA, the city had a $100,000 deductible,
but settlement authority remained with the WCIA's dec1s1on makers, in
1 consultation with the city. Because of the WCIA's settlement authority and
control, provisions 1n the existing city code allocating council authority for
settlement decisions over $15,000 never came into play. Under the city's
new program, the city has unqualified settlement authority for settlement
1 Administration of Claims
Amend KCC 2.97.020
amounts up to $100,000, and above that amount, cooperates with its
rernsurer to determine whether a claim should or should not be settled.
C. Because of the nature of settlement mediation and
negotiation, it 1s extremely important for the parties to the dispute to
know, with certainty, that they can rely on the terms of the settlement. As
a result, 1t 1s not practical to agree to a settlement subject to subsequent
council approval because the uncertainty and delay would have a distinct
chilling effect, potentially making the city's settlement posture 1neffect1ve.
Accordingly, with this new insurance structure and consistent with past
practice through WCIA, 1t is necessary to amend city code to reflect
changes to claims and admm1strat1on and settlement.
D. Based on the changes to the city's new insurance program, it
is appropriate to change Chapter 2.97 of the Kent City Code. With a
structure s1m1lar to the WCIA claims administration process, the city's risk
manager would have authority to settle claims or lawsuits m amounts up
to $100,000. Above that amount, settlement authority would reside with
the mayor, in con1unct1on with the risk manager and the city attorney,
after consultations with the city's remsurers. All settlements must remain
within established budgets, and staff must report details of all settlement
over $100,000 to the city council.
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF KENT,
WASHINGTON, DOES HEREBY ORDAIN AS FOLLOWS:
ORDINANCE
SECTION 1. -Amendment. Section 2.97.020 of the Kent City Code
is amended as follows:
2 Administration of Claims
Amend KCC 2.97.020
Sec. 2.97 .020. Administration of claims. The city attorney shall
be responsible for representing the city on all claims made against the city
except to the extent claims are administered and/or defended by the city's
insurance companies, Washington Cities Insurance Authority and other
contracted claims administration service prov1dersinsurers. unless the
claim 1s administered or defended through an indemnity agreement by
another insurer, rn which case those claims shall be administered and
defended pursuant to the terms of those contracts. The mayorc1ty's risk
manager shall have the authority to settle any claim agarnst the city for an
amount not to exceed f1ftecnone hundred thousand dollars
($15,000100,000) per occurrence subJect to the availability of funds
budgeted for settlement purposes. The mayor. m conJunct1on with the risk
manager and city attorney, shall have the authority to enter 1ntoAH
settlements over $100.000. All settlements over $100,000 shall be
reported to the city council.!. as directed by the council. All settlements over
fifteen thousand dollars ($15,000) per occurrence shall be subject to
council approval.
SECTION 2. -Severability. If any one or more section, subsection,
or sentence of this ordinance 1s held to be unconst1tut1onal or mvahd, such
dec1s1on shall not affect the validity of the remaining portion of this
ordinance and the same shall remain in full force and effect.
SECTION 3. -Corrections by City Clerk or Code Reviser. Upon
approval of the city attorney, the clty clerk and the code reviser are
authorized to make necessary corrections to this ordinance, rncludrng the
correction of clerical errors; references to other local, state or federal laws,
codes, rules, or regulations; or ordinance numbering and
section/subsection numbering.
3 Administration of Claims
Amend KCC 2.97.020
SECTION 4. -Effective Date. This ordinance shall take effect and
be m force thirty (30) days from and after its passage as provided by law.
7~~
ATIEST:
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APPROVED AS TO FORM:
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~ /7~~-.-M ~-+ PASSED: o& day of -=~'-=-----A~'-=-==----' 2011.
APPROVED: ~~ay of __ ~~---==~~-• 2011.
PUBLISHED: ~ay of _.....,a:r~-, ,_ ____ , 2011.
I hereby certify that th rs is a true copy of Ordinance No. Lf.o tJ t:J
passed by the City Council of the City of Kent, Washington, and approved
by the Mayor of the City of Kent as hereon 1nd1cated.
P \C1v1l\Ordmance\Adm1nistrat1on of Claims Amend 2 97 020 docx
~(SEAL)
I CITY CLERK
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4 Administration of Claims
Amend KCC 2.97.020