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HomeMy WebLinkAbout2000 05-22 EDAP EDA MEETING City of Brooklyn Center • May 22, 2000 1. Call to Order 2. Roll Call 3. Approval of Agenda and Consent Agenda -The following items are considered to be routine by the Economic Development Authority and will be enacted by one motion. There will be no separate discussion of these items unless a Commissioner so requests, in which event the item will be removed from the consent agenda and considered at the end of Commission Consideration Items. a. Approval of Minutes - Commissioners not present at meetings will be recorded as abstaining from the vote on the minutes. 1. May 8, 2000 - Regular Session 4. Commission Consideration Items a. Resolution Awarding Contracts for EDA Insurance Policies for 2000 • •Requested Commission Action: - Motion to adopt resolution. 5. Adjournment • EDA Agenda Item No. 3a • • MINUTES OF THE PROCEEDINGS OF THE ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND THE STATE OF MINNESOTA REGULAR SESSION MAY 8, 2000 CITY HALL • 1. CALL TO ORDER The Brooklyn Center Economic Development Authority (EDA) met in regular session and was called to order by President Pro Tem Debra Hilstrom at 7:33 p.m. 2. ROLL CALL President Pro Tem Debra Hilstrom, Commission Members Kay Lasman, Ed Nelson, and Robert Peppe. President Myrna Kragness was absent and excused. Also present: Executive Director Michael J. McCauley, City Attorney Charlie LeFevere, and Recording Secretary Maria Rosenbaum. 3. APPROVAL OF AGENDA AND CONSENT AGENDA • A motion by Commissioner Lasman, seconded by Commissioner Nelson to approve the agenda and consent agenda. Motion passed unanimously. 3a. APPROVAL OF MINUTES A motion by Commissioner Lasman, seconded by Commissioner Nelson to approve the minutes from the regular session on March 27, 2000. Motion passed unanimously. 4. COMMISSION CONSIDERATION ITEMS 4a. RESOLUTION APPROVING RELOCATION CLAIMS FOR 6421 BROOKLYN BOULEVARD, BROOKLYN CENTER, MINNESOTA Executive Director Michael McCauley discussed this resolution would authorize the business relocation claim for North Suburban Vacuum and the residential relocation claims for 6421 Brooklyn Boulevard and pay the claims in accordance with the City purchasing policy. • 05/08/00 -1- DRAFT RESOLUTION NO. 2000-08 • Commissioner Lasman introduced the following resolution and moved its adoption: RESOLUTION APPROVING RELOCATION CLAIMS FOR 6421 BROOKLYN BOULEVARD, BROOKLYN CENTER, MINNESOTA The motion for the adoption of the foregoing resolution was duly seconded by Commissioner Peppe. Motion passed unanimously. 5. ADJOURNMENT A motion by Commissioner Peppe, seconded by Commissioner Nelson to adjourn the meeting at 7:35 p.m. Motion passed unanimously. President • 05/08/00 -2- DRAFT 1 EDA Agenda Item No. 4a 0 0 MEMORANDUM TO: Michael J. McCauley, Manager City er g FROM: Charlie Hansen, Finance Director DATE: May 18, 2000 SUBJECT: Resolution Awarding Contracts for City Insurance Policies and the Insurance Agent for 2000 Attached is a resolution which will authorize renewal of the following insurance contracts: POLICY: INSURANCE COMPANY: Comprehensive Property and Casualty Insurance L.M.C.I.T. Worker's Compensation Insurance L.M.C.I.T. Boiler and Machinery Insurance L.M.C.I.T. Accident Plan for Volunteers L.M.C.I.T. Open Meeting Law Defense L.M.C.I.T. Liquor Liability Insurance L.M.C.I.T. • The renewal this year for the first time includes liability insurance for the E.D.A. as a separate entity. This closes a gap in the City's insurance which could otherwise leave the City exposed in certain, limited instances. Premiums are slightly higher for this coverage. The League of Minnesota Cities Insurance Trust (L.M.C.I.T.) reevaluated the City of Brooklyn Center's claims experience for the insurance policies for 2000. They cite what they consider to be excessive claims in the area of liability insurance. Premiums for liability have been surcharged as a result. This plus the separate policy for the E.D.A. have increased total liability premiums by 28% over 1999 premiums. The claims experience also raised the liability portion of the automobile insurance. Money and security insurance was folded into another coverage and no longer shows up as a separate coverage. The liability, mobile equipment, and automobile insurance premiums are over the amounts budgeted for them. Other insurance premiums are close to or within the amounts budgeted. The attached spreadsheet provides more detail on the City's insurance premiums. • It should be noted that the City has received dividends back from the LMCIT in each of the last thirteen years. In 1999, the city received a dividend of $28,502 on property and casualty premiums which originally totaled $218,533. This represents 13% of the original premium. The city also received a dividend of $63,288 in 1999 on worker's compensation insurance premiums of $136,799 in 1998. We expect to receive dividends again in 2000, but can't predict the amounts. The resolution also will renew the annual contract with the City's insurance agent. The L.M.C.I.T. requires that the City have an insurance agent in order to participate in their property /casualty program. Also, the City doesn't always buy all of its policies from the L.M.C.I.T. In some cases, they don't provide a coverage we need, in others they aren't the best or lowest cost provider. An agent is needed to help us determine the best source of coverage and then prepare and submit applications for that coverage. The City has an agreement with AJ Gallagher & Co. of Minnesota, Inc. for agent services on a flat "fee for services" basis rather then paying a commission based on premiums, which is the more common practice in the insurance industry. Such commissions vary from 2% up to 10% of premiums. If the city didn't have the flat fee agreement, the commissions to the agent could exceed $20,000 a year. AJ Gallagher & Co. has agreed 410 to extend its contract to April 1, 2001 for a fee of $10,500. The fee was last increased in 1999 from $9,000 to $9,500. AJ Gallagher has also taken over the duties of risk management consultant. This previously was a separate consultant with a fee of $6,180 per year. Gallagher will handle simple phone calls within their insurance agent fee. More extensive projects are billed on a per hour basis. As our staff have become more experienced, we have been using less risk management consultant services. The new combined agent /consultant agreement with per hour billing re sults in the City paying less for these services than at any time in the last ten years. Risk management is a larger endeavor than just insurance. The insurance consultant is an additional source of expertise used to help in areas such as loss prevention, analyzing levels of risk to retain in the city as opposed to transferring the risk via insurance, analyzing operations, and reviewing insurance applications to confirm that we completely listed all properties and activities which should be insured. • • • • CITY OF BROOKLYN CENTER INSURANCE CONTRACTS FOR 2000 City EDA Total Percent 2000 2000 2000 1999 Increase Increase COVERAGE Premium Premium Premium Premium (Decrease) - Decrease Comprehensive Municipal Property & Casualty General Liability $148,460 $20,415 $168,875 $131,442 $37,433 28.48% Property & misc equipment 20,478 14,219 34,697 37,610 (2,913) -7.75% Mobile Property 7,162 7,162 5,285 1,877 35.52% Boiler & Machinery 5,263 1,713 6,976 6,923 53 0.77% Automobile Liability & Collision 45,465 88 45,553 32,301 13,252 41.03% Money & Security 0 0 1,783 (1,783) - 100.00% Bonds 3,208 3,208 2,955 253 8.56% Total Property & Casualty 230,036 36,435 266,471 218,299 48,172 22.07% Worker's Compensation 165,642 165,642 161,471 4,171 2.58% Accident Plan for Volunteers 2,175 2,175 2,175 0 0.00% Open Meeting Law Defense 2,195 2,195 1,709 486 28.44% Liquor Liability 8,283 8,283 8,570 (287) -3.35% TOTAL $408,331 $36,435 $444,766 $392,224 $52,542 13.40% insurance/renewalawardins 5/17/00 • Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION AWARDING CONTRACTS FOR EDA INSURANCE POLICIES FOR 2QQ() WHEREAS, the Director of Finance and the City's Insurance Agent have negotiated annual renewal premiums for the Economic Development Authority's and Earle Brown Heritage Center's comprehensive insurance coverage for the period from April 1, 2000 to April 1, 2001 and they are as follows: 1. Comprehensive Municipal Property and Casualty Insurance from the League of Minnesota Cities Insurance Trust ( L.M.C.I.T.): Property $ 14,219 Boiler & Machinery 1,713 General Liability 20,415 Automobile Liability 88 II) Total Annual Premium $36,435 2. Open Meeting Law Defense from the L.M.C.I.T.: Covered under City policy ; and 3. Workers' Compensation Insurance from the L.M.C.I.T.: Covered under City policy NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of Brooklyn Center to accept the negotiated insurance renewals and award the contracts as stated. Date President The motion for the adoption of the foregoing resolution was duly seconded by commissioner and upon vote being taken thereon, the following voted in favor thereof: • • and the following voted against the same: whereupon said resolution was declared duly passed and adopted.