REPORT TO THE CITY COUNCIL
June 16, 2016
FROM: JEFF CARDELL, Director
Personnel Services Department
BY: MICHAEL PAYNE, Risk Manager
Personnel Services Department
SUBJECT
Title
***RESOLUTION - 49th amendment to the Annual Appropriation Resolution (AAR) No. 2015-104 appropriating $2,210,000 in the General Fund for the payment of claims and refunds in the Workers Compensation Fund. (Requires 5 affirmative votes)
Body
RECOMMENDATION
It is recommended that Council approve the attached Resolution which provides $2,210,000 of additional appropriations in the General Fund for the payment of Claims and Refunds in the Workers' Compensation fund due to adverse developments during the current fiscal year.
EXECUTIVE SUMMARY
The City's self-insurance funds provide the resources to pay claims and claims-related expenses associated with Property, Liability and Workers' Compensation claims. Due to greater than expected Workers' Compensation claims experienced, additional appropriations are required in the General Fund for the Workers' Compensation fund to bill the additional expense in Fiscal Year 2016.
BACKGROUND
Each year when the budget is adopted, the City appropriates funds to cover the estimated medical, disability and related expenses of the self-insured Workers' Compensation program. This year the total appropriations in the Workers' Compensation Fund are $13,058,000. Unfortunately, the City has incurred medical expenses greater than estimated in large part due to a single catastrophic loss. In addition, claims expenses (largely disability and medical expenses) have increased by 32.6% on average per open claim when compared with the prior fiscal year. Consequently, the Workers' Compensation fund will be recouping the additional amounts needed by allocating charges to the Client Departments and include General, Special Revenue, Enterprise and Internal Service funding sources. Any funds appropriated but not expended by June 30, 2016 ...
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