(A) All departments and employees of the city are charged with the responsibility to identify and report loss exposures or potentially dangerous situations which could lead to an incident or occurrence having an adverse fiscal impact upon the city's assets, its employees, or the general public. All identified exposures shall be reported in writing to the city's Risk Manager who is currently the Director of Risk Management. The Risk Manager shall develop an education campaign for city employees to help them identify dangerous situations and an incentive program to encourage employees to report them.
(B) The city's Risk Manager shall evaluate the potential fiscal impact of all identified exposures by line of coverage (ex. Workers' Compensation; General Liability; Law Enforcement; Auto Liability; City Property; etc.).
(C) The city's Risk Manager shall determine whether to self insure the risk of loss or transfer it to a third party through the acquisition of insurance.
(1) In making this determination, the Risk Manager shall, at a minimum, consider the following:
(a) The availability of the desired insurance coverage;
(b) The deductibles, aggregate limits, and other terms and conditions of any available policy;
(c) The insurance premium vs. the potential fiscal impact of incurred losses;
(d) The potential for catastrophic loss through a single occurrence or in the aggregate of all occurrences;
(2) Insurance policies shall not be acquired unless the following provisions are complied with:
(a) Funding for insurance policies has been obtained through the city's appropriation process; and
(b) The line of coverage and rate of commission is specified in the city's contract with its Insurance Agent of Record; or specifications will be prepared and bids solicited for the insurance policy(ies) in accordance with the Public Purchase Ordinance and the Agent of Record contract.
(D) The city's Risk Manager shall, in conjunction with the preparation of the city's annual operating budget, prepare a Cost of Risk Allocation Plan to equitably distribute the anticipated expense of the Risk Management Fund to all departments, agencies, or funds benefiting from the operations of Risk Management. It is the intent of the Council that this plan is to be used to assure that adequate resources are available to provide for the fiscal impact of incurred losses (including adequate reserves therefore) and all other appropriated expenditures of the Risk Management Fund. Therefore, the assessments (allocations) derived through the plan as well as any deviations shall be disclosed to the Council prior to the adoption of the city's annual operating budget.
(E) The City Council hereby adopts a policy to meet its financial obligations on unforeseen incurred losses which arise from court judgments. In those situations where the payment of a claim would significantly overextend the budget or severely undermine the plan to fully reserve for claims then the city's Risk Manager shall prepare legislation with the Mayor's endorsement for submission to the City Council for their consideration. Accompanying such legislation shall be a full explanation of the claim and judgment and the reasons why it cannot be paid for out of the funds available in the Risk Management Fund. The Council, after full deliberation, will determine through its normal legislative process whether or not the judgment shall be placed on the property tax rolls. Only those judgments shall be considered for incidents occurring after July 1, 1990 or prior, providing a judgment against the city is rendered by a court and that judgment exceeds the limits of the Tort Claims Act. Judgments meeting the above requirements and eligible for such treatment in accordance with the provisions of the Tort Claims Act of the state of New Mexico shall be considered; provided however that there must be a 2/3 vote of those voting for approval to place such losses on the property tax roles.
(F) The administration is hereby requested to research and evaluate alternatives for complying with the requirements promulgated by the Government Accounting Standards Board (GASB) to implement a plan by 1995 to eliminate the deficit in the Risk Management Fund. Included, as part of this analysis, should be an evaluation of the costs of non-compliance, a survey of the plans and actions taken by other governmental entities relative to the GASB ruling and the potential for city assets being placed in the Risk Management Fund in lieu of a cash transfer. In evaluating the asset transfer alternative a set of criteria should be developed and current and future city assets systematically assessed against these criteria. A formal report on the results of the research and alternatives should be made to the Council prior to July 1, 1991.
(Res. 133-1990, approved 10-15-90)