Fort Ord Reuse Authority (FORA)Environmental Services Cooperative Agreement (ESCA)

Remediation Program (RP)

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FORA Environmental Liability Insurance

Presentation by:Barry Steinberg, Kutak Rock

April 12, 2013 – Board of Directors Meeting

Current PLL Coverage

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• Coverage includes:

◦ Cleanup costs (including investigation)

◦ Personal injury/property damage

◦ Defense costs

• Coverage for:

◦ Explosive risk/MEC

◦ Other pollution conditions

Current Policy Terms and Conditions

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•Ten-Year Term

•$100M

•Expiration 31 DEC 2014

•Named insured – FORA

• Additional named insured – local land owning jurisdictions

•Developers – portions of jurisdictions’ coverage

Impact of Coverage Expiration

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•Self-insured/uninsured

•Limited funds available from ESCA Grant

•Loss of continuity of coverage upon property transfer

•MEC event – very low likelihood, catastrophic consequences

Options

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• Go naked! – general fund risk

• Use remaining PLL ESCA grant funds to help purchase new policy

• Ten-year policy will permit continuity of coverage for land-holding jurisdictions after FORA demise

• Single policy avoids cross-border disputes

• Reduced limits?