A year ago the City of Pacific was in shambles.
With its insurance through Canfield and Associates cancelled, the City was staring at 2013 without it, thanks to the mismanagement of former Mayor Cy Sun.
What a difference a year makes.
Today, with nearly 365 days of high-cost, stopgap insurance to its credit, Pacific hopes to rejoin the Association of Washington Cities risk pool.
The City’s insurance had been set to expire at midnight on Dec. 31, 2012, cancelled by the Canfield because of Sun’s mismanagement. In his first year in office, Sun had effectively gutted the City’s department head staff.
The situation was so dire that City officials at one point considered annexing into neighboring Auburn or disincorporating altogether rather than operate without the liability insurance they needed to protect elected officials and the administration from lawsuits.
A last-minute reprieve in the form of a new insurance policy saved the day, but at the same time it saddled Pacific with a higher premium cost, about $250,000 annually.
“Basically, it was catastrophic insurance coverage,” said current Mayor Leanne Guier, who, as council president, helped secure the City’s current policy. “The deductible is extremely high ($250,000 for liability, $500,000 for employee coverage), and we have to pay for a third-party administrator for everything. They review any claims that come against the City.”
Although the stopgap insurance may have rescued the City, after voters recalled Sun in a special election, the current administration has made getting back into the AWC risk pool a priority.
At the Dec. 9 City council meeting, Guier presented councilmembers with a proposed interlocal agreement between Pacific and the AWC’s Risk Management Service Agency (RMSA) that would, with several stipulations, allow Pacific to reenter the risk pool.
“Basically, we agreed to it, but it’s not official until it’s signed,” Guier said of the agreement. “Council needed to see what they were asking from us, but it’s not confirmed yet.”
(The ACW’s decision was announced Wednesday but the results were unavailable at press time.)
Among the numerous stipulations the City of Pacific has to fulfill in the proposed agreement are:
• complete claims training provided by the AWC RMCA for all clerks, secretaries and risk managers responsible for claims submission within six months;
• complete AWC “Elected Officials Essentials” training for elected/appointed mayor, council members, commissioners and board members within six months;
• complete AWC RMSA “Being an Effective Board Member” training for all civil service commission and park board members within six months;
• contact the AWC RMSA before taking any personnel action that may result in the termination of any employee, supervisor or department head; and
• submit the City’s “Personnel Policies and Procedures” handbook to the AWC RMSA.
The agreement also calls for any Pacific employees who drive a City vehicle to complete a defensive driving course every three years, in addition to an Emergency Vehicle Operating Course mandated every three years for police officers.
Guier said the AWC is to provide training courses free to the City.
Despite the long list of requirements, Guier said, the cost savings make the agreement a win for the City.
“We haven’t seen what the final cost will be to the City, but it will probably be about half of what we’re paying now,” she said. “And they provide third-party management, which we have to pay for now. This is huge for us to get into the risk pool. We just have to do all the training and basically play by their rules.”
