full board meeting yakima holiday inn 802 east yakima ... · pdf file802 east yakima avenue...

Full Board Meeting Wednesday – May 7, 2014

Yakima Holiday Inn 802 East Yakima Avenue

Yakima, WA 98901 Phone: 509-494-7000

10:00 – 11:45 a.m. Training Session: Personnel Issues Presented by — Beth Kennar, Summit Law Group

Lunch Provided by WCIA

Noon – Full Board Meeting

Call to Order/Self Roll Call

Consent Calendar: • Approval of January Full Board Minutes

Director’s Report: Page 10 • WAC 200-100 Changes • GEM Meeting • Cyber Coverage • Broker Request for Proposal • 911 Communication Center Meeting • 2014 COMPACT • Litigation Results

Presentation of Risk Reduction Grant Recipients Page 12

Member Achievements and Acknowledgements 1:30 – 3:30 p.m. Training Session: Land Use Presented by — Ken Harper, Menke Jackson Beyer

FULL BOARD MEETING January 17, 2014 Museum of Flight – Seattle, WA

MEMBERS PRESENT: Kylie Purves, Poulsbo; Robin Jenkinson, Kirkland; Kathy Joyner, Kirkland; Arlene Fisher, Cheney; Rod Otterness, Union Gap; Brian Butterfield, Kelso; Steve Taylor, Kelso; Paul Schmidt, Chelan; Steve Romberg, PENCOM; Shelley Acero, Burlington; Bryan Harrison, Burlington; Debbie Stanley, Three Rivers Regional Wastewater; Duane Leaf, Three Rivers Regional Wastewater; Bob Coons, Port Angeles; Abbi Gates, Port Angeles; Farah Derosier, LOTT Alliance; Rick Hughes, LOTT Alliance; Peggy Hammer, Chehalis; Emily Schuh, Anacortes; Ryan Larsen, Anacortes; Steve Guptill, Monroe Fire District 3; William Archer, Clyde Hill; Tom Glover, Walla Walla Joint Community Development Agency and Metropolitan Planning Organization; Nancy Abell, Marysville; Patti Rader, Shoreline; Larry Kieling, SERS; Mark McDermott, SERS; Chris Boughman, Mukilteo; Deborah Booher, Poulsbo; Paula Swisher, Brier; Anastasiya Warhol, Yarrow Point; Paul Loveless, Steilacoom; John Caulfield, Lakewood; Leslie Blaisdell, University Place; Judy Thomas, Coupeville; Larry Cort, Oak Harbor; Allen Johnson, Arlington; Sam Taylor, Ferndale; Chris Searcy, Enumclaw; Gene Brazel, Monroe; Ben Warthan, Monroe; Tho Kraus, Lakewood; Patrick Curran, Silver Lake Water & Sewer District; Connie Cobb, Olympia TBD; Subir Mukerjee, Milton; Jay Burney, Olympia; Wayne Tanaka, Issaquah/Woodway; Shawn Hunstock, Maple Valley; Joanne Gregory, Kenmore; Scott Hatfield, EPSCA; Mitch Lackey, Camas; Joseph Gavinski, Moses Lake; Lyman Howard, Sammamish; Rodger Bennett, Des Moines Pool MPD; Chris Smith, Longview/Water Operating Board; John Whitehead, Spokane Valley; Julie Evans, Bothell; Steve Johnson, Hoquiam; Gloria Hirashima, Marysville; Greg Rubstello, Woodinville/Clyde Hill; Jay Covington, Renton; Ellen Schroer, Bainbridge Island; Gary Lamb, Renton; Lee Knottnerus, Ridgefield; Cynthia Schaff, Burien; Wade Farris, Othello; Mark Ziegler, Shelton/Shelton MPD; Wendy Hill, Thurston 911 Communications; Jim Quackenbush, Thurston 911 Communications; Arthur Sullivan, ARCH; Peach Stebbins, Port Townsend; Candice Rydalch, Centralia; Tom Richardson, Millwood; Alexandria Sheeks, Woodinville; Landy Manuel, Mill Creek; Stan Strebel, Pasco; Gene Miles, Long Beach; Sheri Thomas, Puyallup; Nancy Kuehnoel, Des Moines Pool MPD; Woody Edvalson, Bonney Lake; Lon Wyrick, Thurston Regional Planning Council; Jared Burbidge, Thurston Regional Planning Council; Lyn Gross, ESCA/NWIMT; Debbie Zabell, Edgewood; Dave Zabell, Fife; Mary Lorna Meade, Issaquah; Kathryn Skolrood, Aberdeen; Rob Roscoe, Auburn; Craig Knutson, Burien; Scott Patterson, Cowlitz-Wahkiakum Conference of Governments; Jason Wilson, Sumner; Debra Whalawitsa, Snoqualmie; Dicker Cahill, Yarrow Point; Debbie Burke, Normandy Park/Normandy Park MPD; Pete Rose, Lake Forest Park/Lake Forest Park TBD; Mary Sue Robey, Valley Com; Cynthia Shaffer, South Sound 911; Eric Trimble, Tumwater; Bruce Fletcher, Mercer Island and Deborah Knight, Stanwood/Stanwood TBD; OTHERS PRESENT: Maria Orozco, Member Services Coordinator; Katie Madsen, Member Services Assistant; Lisa Knapton, Sr. Risk Management Rep; Reed Hardesty, Claims Manager; Tanya Crites, Sr. Risk Management Rep; Patti Crane, Member Services Manager; Shelley O’Keefe, Claims Assistant; Tiffany Woods, Programs Assistant; Jason Barney, Sr. Claims Adjuster; Carlene Brown, Claims Representative; Doug Martin, St. Claims Adjuster; Gordy Van, Sr. Claims Adjuster; Eric Larson, Deputy Director of Insurance Programs; Chip McKenna, Sr. Risk Management Rep; Lisa Roberts, Risk Services Manager; Ann Bennett, Executive Director; Jill Marcell, Deputy Director of Administrative Services; Tina Smith, Secretary; Debbi Sellers, Sr. Risk Management Rep and Jennifer Lawson, Receptionist.

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CALL TO ORDER: Acting President Jared Burbidge called the meeting to order at 10:16 a.m., went over a few housekeeping items and began with a self roll call CONSENT CALENDAR: Motion Pete Rose—Lake Forest Park, moved to approve the consent calendar; Dave Zabell—Fife, seconded. The motion passed unanimously. ACTING PRESIDENT’S MESSAGE J. Burbidge thanked the members for their attendance. He expressed appreciation to those who attend the meetings regularly and participated in the committees. He challenged members to consider participating in the committees to learn more about WCIA and pooling in general. He added it has been very gratifying for him to participate and encouraged others to do the same. He asked the Executive Committee members to stand and be recognized, and thanked the WCIA staff for their expertise and professionalism. He took time to recognize a few key individuals for their service to WCIA. Bob Coons—Port Angeles, who was retiring from city service, was presented with a certificate for his service as a WCIA delegate. He served over 20 years as the delegate for Port Angeles and on the Loss Control Committee from 1998-2002. Burbidge also honored outgoing president Brenda Heineman—Auburn. She served as the city’s delegate since 2001, on the Loss Control Committee from 2002-2005 and on the Executive Committee from 2005 to the present. She had recently left the city and was therefore unable to continue serving as president. Allen Johnson—Arlington was also honored for his service to WCIA with a plaque. He served as the delegate beginning in 2006 and served on the Long Range Planning Committee since then; he also served on the Executive Committee from 2007 to the present and, though was leaving the committee, he was not retiring from the city. DIRECTOR’S REPORT: Executive Director Ann Bennett welcomed the membership and thanked them for their participation, as they are what drive the organization She updated the membership regarding potential changes to the pooling WAC. The Department of Enterprise Services (DES) has decided not to make any amendments to the proposed changes based on comments received in the recent hearings. Upon that decision, the full comments from the hearings were released to the public and they appeared to be pointed at WCIA, though our name was never mentioned. Criticism of the new changes was based on the perception they give an unfair business advantage. Bennett definitively assured the members this was not the case and stated the changes were beneficial for pooling over all. As an example, she added that every pool but one would have no difficulty meeting the newly proposed 80% funding level. Other proposed changes address financial reporting, reducing the required time to submit them so members have the information prior to renewal. Bennett stressed the goal was to ensure pools continue to be stable since the failure of one pool affects all of them. The WAC should be implemented in the summer.

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Based on feedback regarding the utilization of WCIA’s consultation, pre-defense and training reimbursement benefits, members will now begin to receive a stewardship report showing what dollars are utilized in those three areas by their entity, as well as the average spent by others within their actuarial group. It will be available during the annual review and staff is eager for feedback from the membership on this tool. She reminded the members that these three programs make up one-third of the WCIA administrative budget; it is money allocated to repay the members in the form of service. Therefore, staff wants to ensure members are taking full advantage of these opportunities. Bennett stated the year-end data has revealed the overall claim reserve has doubled since 2010. This trend of increased losses is very concerning and it is being addressed by staff. They are performing analysis to determine the root cause, or causes, of this trend, as well as how to mitigate it through training or risk management. She stressed these loss trends are due, in part, because of the risks WCIA takes on behalf of the members. The pool will try cases and cover issues that other insurance carriers do not. Mary Lorna Meade – Issaquah, asked for some examples of what WCIA covers that other insurance carriers do not. Bennett gave the example of recent case involving injunctive issues with civil rights violation allegations that most carriers would not cover, ultimately absorbing $3 million of attorney costs for the member. QUARTERLY REPORTS: Jill Marcell, Deputy Director of Administrative Services/Treasurer J. Marcell stated 2013 was an expensive year, but WCIA had the reserves to absorb those expenses. She highlighted that revenues for the year decreased from 2012 by 2.5%. Both assessments and investment income declined from the prior year. Liability assessments comprise the majority of revenue; they were reduced due to a 2.8% average rate decrease. As expected, interest income continued to decline but should not decrease any further. WCIA has been fortunate that its investment income has been as high as it has over the years and it now appears to have plateaued. It is not clear when the rates will go up again, but WCIA is well positioned to take advantage of rates as they increase. The largest change in expenses was the amount spent on claims as WCIA spent $6.1 million more than last year. Claims Manager Reed Hardesty will provide more detail on the claims trends in his report; not only was there a large amount of claims paid in 2013, but reserves also increased $14 million in one year. Because of the large claims payout, total assets declined. January began with $175 million and the year ended with $169 million. Undesignated member reserves are expected to decline significantly; the exact amount will not be known until April once the actuary has made those calculations. Our actuary, PricewaterhouseCoopers (PwC) performed a comprehensive target fund analysis and found WCIA to be funded at a 1-in-200 year event. Though that may seem high, that is what you would want to find in a rated insurance carrier. Such stable funding allows for covering large loss years like 2013.

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The state auditor recently completed their 2012 audit of WCIA and there were no findings or management issues; a link to the auditor’s report is on the WCIA website. Reed Hardesty, Claims Manager R. Hardesty began by reviewing the raw numbers for claims provided to the board. Claims increased by 8% from the prior year; lawsuits decreased slightly and pre-defense remained similar to 2012. The claim trends indicate that land use issues were returning as the recession begins to recover, which shows the audit topic for 2014 is very timely. Now is a good time for members with land use issues to brush up on the fundamentals. The claims department spent $26 million in 2013. A large part of that number goes back to the membership from their property losses. For example, members received a total of $1.5 million in repairs to their vehicles. There were also several other property losses due to events such as fires, a lightning strike, and damage from a windstorm. The other large piece of this total is in liability payments, which include sewer backups or water main breaks, personnel or police issues, and trials. Hardesty highlighted a few cases that contributed to these large losses, and spoke to some of the unusual outcomes with trials in 2013. There were some trials of employment claims where the juries awarded millions of dollars. In one case, the judge ordered a new trial, in the other verdict the judge set aside the large verdict, which is currently under appeal. These are not typical trials or results experienced by WCIA claims staff. To continue to provide positive outcomes, members are encouraged to contact WCIA early for pre-defense advice and provide immediate notice of potential claims. WCIA staff can assist on how to address claim issues and analyze possible responses to potential allegations. Hardesty observed previously WCIA may have received a million dollar claim every other year, but now they are now happening more frequently. Some of that is because of larger economic issues; but by working together and members continuing their due diligence in risk management, such efforts can have an impact on reducing the number of claims paid in a year. Rod Otterness—Union Gap, offered his thanks for the pre-defense program and asked about the increase in the reserves. He observed the reserve increase appears conservative for the potential litigation costs. Hardesty stated the reserving policy has not changed, but as society changes people are becoming more likely to fund their own catastrophic events by seeking out a perceived ‘deep pocket’ on the advice of an attorney. That is a risk of the joint and several liability laws. Jay Covington—Renton, inquired about WCIA considering a different defense strategy due to an existing bias against municipal entities. Hardesty stated he felt it was important to defend the members, but he agreed it could also be beneficial to evaluate claims collaboratively to develop effective, long-term solutions. Counsel M. Bucklin added WCIA wins 68% of cases, which is a record unmatched in the insurance industry. Members are seeing some unique cases that could not have been imagined 20 years ago; many are the first of their kind. He stressed it is important to analyze these claims and

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consider what has been successful in the past. He added the organization does not want to develop a reputation as easy to defeat. Eric Larson, Deputy Director Larson began by reassuring the membership that the bulk of the claims previously discussed occur within WCIA’s active insurance layer. He stressed it is good these losses are not reaching the reinsurance layers so WCIA can continue to negotiate good rates for the property and liability programs. The joint purchase program of crime and fidelity, which provides up to $2.5 million in coverage for a 2014 premium of only $120,000, has experienced incredibly stable rates despite considerable claims in that area. Larson observed there has been over $1.6 million in losses but the rates have barely increased; he predicted that coverage might become more restrictive over time. WCIA was able to negotiate adding all of the new transportation benefit district members to this coverage. In 2014, members will receive coverage for cyber liability. Some members may be asked to correct a few issues in order to overcome initial exclusions, but the insurance will be available in the spring. WCIA’s liability coverage does not exclude cyber liability; therefore, the new purchased coverage will include liability coverage, primary to the WCIA coverage. This policy is very rich providing event coverage that will cover victim cost reimbursement and assistance, as well as expenses for the investigation and public relations. Patti Crane, Member Services Manager Crane recognized the member services staff, Maria Orozco and Katie Madsen, thanking them for their customer service and hard work for the membership. She also thanked the management staff and members of the risk management department for conducting several trainings throughout the year for the membership. In 2013, WCIA saw over 8,500 attendees and over one-third of the training budget was used to provide reimbursements to the members. Crane recognized those members who have already received reimbursements and stressed Member Services would target those who have not yet utilized the program. Crane highlighted information provided in the agenda packet illustrating what trainings are covered through the reimbursement program. Relationships with multiple associations and other organizations strengthen the opportunities of this program and overall member staff development. In 2014, members will have the capability to upload verification documents to WCIA for their reimbursement requests. Additionally, this system will track all issued reimbursements during the year and provide a report members can view on-line. This will compliment the previously mentioned stewardship report. The majority of training topics for 2014 will focus on fulfilling the audit topic COMPACT requirements. The remaining topics were developed based on requests from the membership, previous trainings that are in high in demand, or that effectively address our loss exposures. All of these trainings will be offered regionally. WCIA is also developing programs for small cities that will assist with personnel exposures, and workshops for elected officials. Announcements

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will go out to the membership with detailed information in order to take advantage of these many opportunities. Lisa Roberts, Risk Services Manager Roberts began by thanking the membership for all their efforts on completing the 2013 COMPACT topic of cyber security. This large endeavor yielded full compliance from the entire membership. Over half of the membership was provided with vulnerability testing, which WCIA will continue to provide into 2014. Members can also expect the risk management reps to follow up on any outstanding mandatory issues from that audit topic. The COMPACT audit topic for 2014 is land use, but for those members who are not subject to land use issues regulations—such as the Group 5 members—the audit topics will be tailored to relevant exposures. The reps will work with members to determine the best audit topic for their agencies. Training will be required for the selected topic areas. The COMPACT packets and questionnaires will be posted on-line by February 1, and they will contain all the relevant information on the various topics available. Roberts expressed excitement to launch the Risk Reduction Grant Program. The new committee will meet soon to develop eligibility and approval criteria. Applications are expected to be available to the membership by April. She welcomed the cities of Kennewick, Brewster, Poulsbo, and Ferndale who joined in 2013 along with several transportation benefit districts of existing members. She reminded the membership that WCIA could provide coverage for those special districts. Roberts highlighted that WCIA would be working with a local marketing firm to enhance its brand and messaging strategy. She stated it was a very dynamic process and staff was looking forward to sharing more information about that with membership. She stated the consultation program continues to provide legal advice to the membership on a variety of general risk management topics. There have been numerous consultations on marijuana regulations and three Risk Management Bulletins on that topic are available to the membership on line. Over 61% of the membership requested consultation assistance; staff will be contacting members who have not utilized the program to determine why. It is a benefit available to members for assistance with policies or drafting land use codes. J. Burbidge thanked the mangers for their reports and staff at all levels for their service to the membership. ACTION ITEM(S):

• Risk Reduction Grant Committee - Resolution 230-13 A. Bennett presented the resolution to establish a Risk Reduction Grant Committee. As part of the 2014 goals, the Executive Committee tasked staff to establish a grant program that could assist members in reducing their risks. Creating a committee was the best way to determine what the membership wanted in the program. This committee will establish the grant criteria and application, review the completed

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applications, and award the grant funds. This will be a working committee of six who will vote on these awards. WCIA has set aside approximately $130,000 for this committee to utilize. Once the committee is established and the criteria and applications are developed, that information will be presented to the Executive Committee for approval. The Executive Committee can establish a new committee, but the Full Board needs to approve the necessary language change in the By-laws. Motion Pete Rose—Lake Forest Park, moved to approve Resolution 230-13; Jay Burney—Olympia, seconded. The motion passed unanimously • 2014 Liability Joint Protection Program (LJPP) and 2014 Coverage Document Bennett stated the LJPP is the agreement between the membership and WCIA regarding their coverage. The document outlines several things, such as what is covered, the self-insured retention levels, where coverage is placed and the mutual agreements between WCIA and its members. The self-insured retention level (SIR) will continue at $4 million and WCIA will renew with Government Entities Mutual (GEM) for $1 million in reinsurance above that. The coverage from GEM provides a buffer for WCIA if any issues occur within the insurance industry. Continuing the long-established, positive relationships with our reinsurers, Ironshore will provide $10 million in coverage with Allied World Assurance Company (AWAC) providing $5 million. These costs did increase by 6%, but 3% was due to members’ increased work hours. This modest increase is also on trend with the insurance industry. Bennett highlighted language that provided clarity on WCIA’s authority to handle claims and she pointed out the right of the members to determine coverage was included in the document. Clarifying language was also added regarding cost sharing. All the changes were reviewed and approved by Authority Counsel Mark Bucklin. Motion Arlene Fisher—Cheney, moved to approve the 2014 Liability Joint Protection Program and 2014 Coverage Document as presented, Dave Zabell—Fife, seconded the motion. Discussion M. Bucklin clarified that the LJPP is an agreement among all members and WCIA staff as we are joined by Interlocal agreement. The motion passed unanimously. • 2014 Property Join Protection Program (PJPP) E. Larson spoke to the property coverage stating the membership has a very complex property program with $5.6 billion in values. The best part for the members is the $750,000 deductible allows for many claims to be handled without involving the multiple number of carriers that provide the total coverage.

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Though WCIA does place great value on long-term relationships with its reinsurers, one long-term carrier, Lexington, was not receptive to reducing costs. There is an overall reduction of costs in the insurance industry due in part to fewer catastrophic events and large amounts of capital investment into the industry. Fortunately, National Fire & Marine—a Warren Buffet company—stepped in for Lexington, and Lloyd’s of London maintains a large share of the coverage. He stated the changes in the PJPP mirror those in the LJPP providing clarifying language, and gives authority the Executive Director to determine coverage for items not listed on a property schedule. Motion Mary Sue Robey—Valley Communications Center, moved to approve the 2014 Property Joint Protection Program as presented; Paul Loveless—Steilacoom, seconded. The motion passed unanimously. • 2014 Auto Physical Damage Joint Protection Program (APDJPP) and Coverage

Document Larson stated the Auto Physical Damage JPP changes are similar to those already presented. This program is insured by the property program above $250,000. He added that loss experience in this program was favorable in the previous year. Motion Paul Loveless—Steilacoom, moved to approve the Auto Physical Damage Joint Protection Program and Coverage Document as presented; Mary Lorna Meade—Issaquah, seconded. The motion passed unanimously. • Elections Authority Counsel M. Bucklin stated the annual meeting was not only when the membership approved their coverage documents, but was also when they elected their officers. The nomination process for the positions of president and vice president were previously concluded; the nominee for president was Jared Burbidge of Thurston Regional Planning Council and the nominee for vice president was John Caulfield of Lakewood. Final nominations for Executive Committee positions remain open until this meeting. The current nominees for open positions on the committee are: Woddy Edvalson, Bonney Lake Arlene Fisher, Cheney Rob Roscoe, Auburn Paul Schmidt, Chelan Stan Strebel, Pasco After calling three times for additional nominees, the nominations for Executive Committee positions were closed. Though some members may have more than one ballot because they represent more than one entity, Bucklin stressed there was to be only one ballot per entity with only the voting member casting the vote. Proctors for the election, as selected by the acting president, were Treasurer Jill Marcell, Debbi Sellers and Mary Lorna Meade of Issaquah.

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Bucklin addressed the membership as the proctors counted the votes. He noted that the next president elected would be the 19th president he has worked with at WCIA, and Bennett is the third director of his 32-year tenure. He stated without hesitation the organization was in good hands and he reminded the group it was the members of WCIA who are the reason for its success. Counsel spoke to a recent issue addressed through the WCIA legal consultation program, regarding reasonable medical care for prisoners held in member jail facilities, and the possibility of utilizing the new Affordable Care Act to assist with some of those costs. He opined that on the surface, it appears to be a plausible approach but there are a several legal details for this idea to work. WCIA is working on the issue and has already drafted a resolution for the city council outlining the criteria to pursue this idea on a case-by-case basis. He thanked the city of Anacortes for bringing the issue to the attention of WCIA and added he hopes this issue will work through to be a benefit to all members. The membership recessed for lunch as they waited for the election returns. During lunch, Bucklin announced the new committee members as follows: President: Jared Burbidge, TRPC Vice President: John Caulfield, Lakewood The top three vote recipients for the open positions on Executive Committee: Arlene Fisher, Cheney Rob Roscoe, Auburn Stan Strebel, Pasco Bucklin congratulated the winners. As his first official act as President, Burbidge adjourned the meeting at noon. Jared Burbidge, WCIA President Tina Smith, Authority Secretary Approved on: / /2014

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Director’s Report May 7, 2014 Full Board Meeting

WAC 200-100 Changes

As previously reported, the State Risk Manager proposed changes to WAC 200-100 that governs risk pools. The Department of Enterprise Services (DES) has moved forward adopting the proposed rules after hearing additional testimony. Several pool directors, including myself, met with the Director of Enterprise Services, Chris Liu, to voice our support for the rule changes and educate him as to our programs and philosophies. We understand that those opposed to the rule changes also met with the director to express their concerns. DES notified all concerned parties that they are adopting the proposed rules, which will become effective January 1, 2015. The changes will increase minimum reserve confidence levels to 80%, determine appropriate asset tests, and shorten the time frame for submission of audited financials. GEM Meeting

Government Entities Mutual (GEM) is a captive insurer formed by pools across the nation including WCIA. Currently they provide $1 million of liability reinsurance on top of our $4 million self-insured retention. GEM also provides 15% of the first $100 million of property insurance coverage. The director attended the GEM Board of Directors meeting in Washington D.C. on April 24, 2014. The financial reports, actuary, and independent auditor reports presented all reported positive news. GEM is also looking into providing reinsurance for Cyber Liability coverage and becoming a “coverholder” for Lloyd’s of London that would allow them to access syndicates to provide workers compensation and small transit auto liability. We also heard from the Washington D.C. regulators about a proposed change by the National Association of Insurance Commissioners, which would subject reinsurance captives, like GEM, to the same regulations and accreditation standards as multi-state insurance companies. This would be extremely problematic and GEM will be voicing its opposition to the change, as will the individual members. Cyber Coverage

As approved in the 2014 budget process, WCIA is now providing cyber insurance to the membership effective March 1, 2014, with National Union. The insurance includes $1,000,000 of security and privacy liability (cyber liability) limits to cover the failure to protect or prevent unauthorized access to private or confidential information of others. The policy also provides $100,000 per member for regulatory action, such as fines and penalties imposed by HIPAA. There is a $25,000 per member deductible for each coverage line. The coverage also includes $75,000 per member for privacy event services should confidential data be compromised. The services consist of notification to affected individuals, identity theft call center assistance, identity restoration services, identity monitoring and victim cost reimbursement. The privacy event service is only triggered when there are over 100 affected individuals. The policy provides $100,000 in event management coverage for forensic investigations, costs of a public relations firm, and the cost to restore or recreate electronic data in the event of a theft or violation of the security of a computer system (cyber-attack). The event management coverage has a $25,000 per member deductible.

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Director’s Report May 7, 2014 Full Board Meeting Page 2

Broker RFP

Our current broker contract ends May 31, 2014 and, per WAC 200-100-215, we began the competitive process. The RFP was completed, sent to various brokers, and posted on the AGRIP website. The RFP included a comprehensive list of our needs, which include marketing, placement, and related services. We asked interested brokers to give us a proposal for five years of service. We received responses from four brokers and conducted interviews on May 1-2, 2014. The Executive Committee, prior to the Full Board meeting, may grant authority to the director to contract with the selected broker at their meeting. 911 Communication Center Meeting

After the Court of Appeals decision in Munich v. Skagit 911, we received numerous inquiries regarding the case facts and what 911 centers can do to limit their liability. In response, we convened a meeting on April 16 with our member directors, defense counsel, and WCIA Risk Management and Claim Departments to discuss the case and strategies to reduce liability. Other emerging issues such as the 911 text mandate, rapid responder school program were also discussed. All of our member 911 centers were represented and indicated that the meeting was very helpful. We are hopeful that we can use this type of approach in the future with other significant decisions, mandates, or cases. 2014 COMPACT

This is our first year of providing multiple COMPACT audit topics for the entire membership. Early feedback on the Land Use audit and questionnaire has been very positive. There are eight sections to the questionnaire with two being required: 1) Land Use Regulation – Authority and Limitations and 2) Legislative and Administrative Bodies – Authority and Responsibilities. Members can select which other of the remaining eight sections they wish to include in their audit. The questionnaire is electronic with resources hyperlinked for easy review, e.g., RCW’s, WAC’s, CFR’s, and relevant case law. The Land Use training response has also been favorable with 75% of members attending, or scheduled to attend, one of the five currently scheduled Land Use training sessions. The Risk Management Reps are working with Group 5 members to identify areas of loss and applicable audit topics to address the entity’s exposures. The reps have been providing the trainings from the Risk Management 101 series or individual trainings to Group 5 members to satisfy their COMPACT requirements. Litigation Results

Our first quarter saw nine successful summary judgment dismissals, and three Federal Court trials with three defense verdicts. All were police cases involving false arrest or excessive force and we are very pleased with the results. After a three year wait, we received an unfortunate State Supreme Court ruling that makes city owned parks within a transportation corridor a fact question whether recreation immunity applies for a bike trail. We are briefing the case at the WSAMA pre-conference training along with the indigent defense trial result.

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2014 Risk Reduction Grant Recipients By Lisa Roberts, Risk Services Manager The Risk Reduction Grant Committee met on April 24 to review the submitted grant applications and determine the grant awards. The committee members are: Chairperson Nancy Abell, City of Marysville, Jay Burney, City of Olympia; Kay Kammer, City of Battle Ground; Emily Schuh, City of Anacortes; Steve Johnson, City of Hoquiam; Kathy Joyner, City of Kirkland; and Arlene Fisher (Executive Board liaison), City of Mountlake Terrace. The Risk Reduction Grant Program had an overwhelming response from the membership, with 59 grant applications received for a total of over $880k in grant requests. With a budget of only $130,000, the committee had some very difficult choices to make. Mitigation grants were awarded for projects that would either repair a hazard, or increase safety or security. All staff development grants that met the grant criteria were awarded. The committee awarded five staff development grants and ten mitigation grants as follows: Staff Development Grants:

Battle Ground PRIMA National Conference $3,000 Bonney Lake ARM-P Courses and Exams $1,620 Covington PRIMA National Conference $3,000 Normandy Park PRIMA National Conference $3,000 Olympia PRIMA Institute $3,000

TOTAL $13,620 Mitigation Grants:

Anacortes Library public address system $10,000 Chehalis Pedestrian safety enhancements $6,400 Ellensburg Backup cameras $1,050 Kirkland Maintenance Center camera system $32,300 Lake Forest Park Pedestrian bridge safety project $8,000 Millwood Sidewalk grinding safety project $2,500 Mountlake Terrace Police facility security fence $5,500 Olympia City-wide sidewalk repair $31,730 Pasco Sidewalk repair and maintenance $8,900 Pullman Police facility security cameras $10,000

TOTAL $116,380

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