SOUTH BERGEN MUNICIPAL JOINT INSURANCE FUND MINUTES MEETING JANUARY 18, 2017 LODI MUNICIPAL BUILDING 4:30 P.M.

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1 SOUTH BERGEN MUNICIPAL JOINT INSURANCE FUND MINUTES MEETING JANUARY 18, 2017 LODI MUNICIPAL BUILDING 4:30 P.M. Meeting called to order by Mr. Hansen. Open Public Meeting Act read into Minutes by Chairman. ROLL CALL OF 2016 EXECUTIVE COMMITTEE: Chairman John Hansen East Rutherford Present Vice Chairman Frank Bianchi Lyndhurst Present Secretary Gregory Franz Borough of Edgewater Present Executive Committee Charles Cuccia Borough of Maywood Present Peter Van Winkle Borough of Rutherford Present Dominick Azzolini Borough of Wood Ridge Present Joseph Crifasi Borough of Carlstadt Present ALTERNATES Victor Baginski #1 Borough of Wallington Present Al Restaino #2 Borough of Fort Lee Present Bruce Masopust #3 Borough of Lodi Present Robert Colletti #4 Borough of Elmwood Park Present APPOINTED OFFICIALS PRESENT: Executive Director/ Perma Risk Management Services Present Administrator Stephen Sacco Attorney Paul Barbire Present Underwriting Manager Conner Strong & Buckelew Present Ed Cooney Claims Services Bergen Risk Managers Kathleen McGuire Present Treasurer Joseph Iannaconi, Jr. Present Safety Director JA Montgomery David McHale Absent (1) South Bergen Municipal J I F

2 OTHERS PRESENT: Jason Thorpe, Perma Hugo Poli, Ridgefield Park Paula Cozzarelli, Little Ferry Gary Vinci, Lerch, Vinci & Higgins Kim Cosimano, RMC Ezio Altamura, RMC Frank Covelli, RMC Sharon Fallon, RMC Matt McArow, RMC Angela Intindola, RMC Ken Schulz, JA Montgomery APPROVAL OF MINUTES: DECEMBER 21, 2016 MOTION TO APPROVE OPEN AND CLOSED MINUTES FOR THE ABOVE REFERENCED MEETING: MOVED: SECOND: VOTE: Commissioner Azzolini Commissioner Baginski Unanimous CORRESPONDENCE: None MOTION TO ADJOURN SINE DIE: MOVED: SECOND: VOTE: Commissioner Crifasi Commissioner Cuccia Unanimous Chairman Hansen asked the Executive Director, Mr. Sacco to assume the Chair. Mr. Sacco indicated that in accordance with the by-laws of the Fund, Mr. Thorpe would read the roll call of the Fund Commissioners to establish if a quorum was present. ROLL CALL OF FUND COMMISSIONERS: (2) South Bergen Municipal J I F

3 It was established a quorum of the Fund Commissioners was present, thus Mr. Sacco indicated the Reorganization of the Fund would continue. He further explained that in accordance with the by-laws, the Fund elects a Chairman, Secretary, Five (5) member Executive Committee, and Alternates. MOTION TO OPEN FLOOR FOR NOMINATIONS OF CHAIRMAN, SECRETARY, EXECUTIVE COMMITTEE, AND ALTERNATES: Moved: Second: Vote: Commissioner Azzolini Commissioner Hansen Unanimous NOMINATING COMMITTEE REPORT: Commissioner Cuccia said the Nominating Committee would recommend the following slate: Chairman Vice Chairman Secretary John Hansen Francis Bianchi Gregory Franz (3) South Bergen Municipal J I F

4 Executive Committee Charles Cuccia Peter Van Winkle Dominick Azzolini Joseph Crifasi Exec Committee Alternates Victor Baginski #1 Al Restaino #2 Robert Colletti #3 Christopher Eilert #4 Mr. Sacco asked for additional nominations. Hearing none, Mr. Sacco asked for a motion to close nominations and confirm elections as presented by the Nominating Committee MOTION TO CLOSE NOMINATIONS AND APPROVE SLATE, AS RECOMMENDED BY THE NOMINATING COMMITTEE: Moved: Second: Vote: Commissioner Crifasi Commissioner Colletti Unanimous ATTORNEY ADMINISTERED OATH OF OFFICE TO OFFICERS, EXECUTIVE COMMITTEE AND ALTERNATES. Mr. Sacco asked for a roll call of the 2017 Executive Committee. Chairman John Hansen East Rutherford Present Vice Chairman Frank Bianchi Lyndhurst Present Secretary Gregory Franz Borough of Edgewater Present Executive Committee Charles Cuccia Borough of Maywood Present Peter Van Winkle Borough of Rutherford Present Dominick Azzolini Borough of Wood Ridge Present Joseph Crifasi Borough of Carlstadt Present ALTERNATES Victor Baginski #1 Borough of Wallington Present Al Restaino #2 Borough of Fort Lee Present Robert Colletti #3 Borough of Elmwood Park Present Chris Eilert #4 Borough of South Hackensack Present Mr. Sacco then indicated that he would review the reorg resolutions with the committee. (4) South Bergen Municipal J I F

5 RESOLUTION 2-17 FUND PROFESSIONAL APPOINTMENT AND PROFESSIONAL SERVICE AGREEMENTS: Resolution presented to confirm appointments of Fund Professionals and approval of Professional Service Agreements. Executive Director - Attorney Treasurer Actuary Auditor Internal Auditor Safety Director Claims Administrator Managed Care Asset Manager UW Manager Web Site Developer Property Appraiser Stephen Sacco, Perma Risk Management Services Paul Barbire, Esquire Joseph Iannaconi Charles Gruber, Stergiou & Gruber Gary Vinci, Lerch, Vinci & Higgins Russo & Associates JA Montgomery Bergen Risk Managers Bergen Risk Managers Wilmington Trust Conner Strong & Buckelew Execu-Tech Asset Works Mr. Sacco requested the following Resolutions be considered for adoption with one motion, unless a Fund Commissioner or Executive Committee member objected: 1-17 Certifying the Election of Chairman and Secretary 2-17 Appointing Certain Professionals and Service Organizations 3-17 Establishing Public Meeting Procedures Establishing a Fiscal Management Plan for the 2017 Fund Year, Al Restaino is the extra signature Establishing a Fund Records Program 6-17 Establishing the 2017 Plan of Risk Management. All changes are highlighted within the plan Appointing Approved Defense Counsel for Establishing Meeting Compensation for Board of Commissioners Upon conclusion, the acting Chairman asked if there were any questions on the resolutions. Hearing no further requests or questions, Mr. Sacco asked for a motion to approve resolutions 1-17 through 8-17, as noted above. MOTION TO ADOPT RESOLUTION NOS THROUGH 8-17: MOTION: SECOND: VOTE: Commissioner Bianchi Commissioner Cuccia Unanimous Mr. Sacco then turned the meeting over to Chairman Hansen. COMMITTEE APPOINTMENTS: Chairman Hansen informed the Board that the Safety Committee was seeking volunteers. He added that Commissioner Caruso from Lodi Borough would be joining the Claims Committee. (5) South Bergen Municipal J I F

6 MOTION TO ENTER INTO EXECUTIVE SESSION FOR CERTAIN SPECIFIED PURPOSES: PERSONNEL - SAFETY & PROPERTY OF PUBLIC LITIGATION Moved: Second: Vote: Commissioner Colletti Commissioner Crifasi Unanimous MOTION TO ADJOURN EXECUTIVE SESSION MOTION: SECOND: VOTE: Commissioner Azzolini Commissioner Van Winkle Unanimous MOTION TO APPROVE PAYMENT OF CLAIMS AS DISCUSSED IN EXECUTIVE SESSION: Z19727 WC Z18724 WC WC WC Z03119/ GL X632270/ GL Z08286/ GL PR MOTION: SECOND: VOTE: Commissioner Restaino Commissioner Cuccia Unanimous TREASURER Mr. Iannaconi s Monthly Financial Report which contained an overview of the transactions that took place for the month relative to the financial portfolio of the Fund was introduced. He referred to the Supplemental December voucher payments and January Bills List enclosed within the agenda. RESOLUTION DECEMBER SUPPLEMENTAL VOUCHER PAYMENTS: 2016: $ 16, (6) South Bergen Municipal J I F

7 RESOLUTION 9-17 JANUARY VOUCHER PAYMENTS (BILL LIST): 2016: $ 11, : $ 894, TOTAL: $ 905, MOTION TO APPROVE CERTIFICATION OF CLAIMS & CONFIRMATION OF CLAIMS PAYMENTS FOR THE MONTH OF DECEMBER, RESOLUTION NO DECEMBER SUPPLEMENTAL VOUCHER LIST, AND RESOLUTION 9-17 JANUARY VOUCHER LIST AS SUBMITTED: MOVED: SECOND: VOTE: Commissioner Colletti Commissioner Baginski Unanimous Treasurer's Reports Attached and Made Part of the Minutes EXECUTIVE DIRECTOR/ADMINISTRATOR: Mr. Sacco began by thanking the Board for Perma s reappointment. FINANCIALS Mr. Sacco referred the Committee to the Financial Fast Track enclosed within the agenda booklet. He reported that the Fund is still monitoring a small deficit in Fund Year 2015 of just over 78,000 but noted that there is enough surplus in the other Fund Years to extinguish the deficits. Mr. Sacco informed the Board that the Fund s overall statutory surplus for all fund years combined is just under 7.2 million and noted that the Fund remains in excellent financial shape ASSESSMENTS Mr. Sacco informed the Committee that the first installment payments are due to Treasurer Joseph Iannaconi by January 31st. He asked that members submit their payments on time. MEL 2017 REORGANIZATION MEETING: Mr. Sacco indicated that the MEL s 2017 Reorganization meeting was held on Wednesday, January 4, 2017 at the Forsgate Country Club. He then referred to Commissioner Cuccia s report on the meeting enclosed within the agenda packet. Mr. Cuccia advised that the MEL is monitoring the Senate Bill that allows JIFs to participate in a Unitized Investment Trust program. He noted that the Bill did pass the Senate and would be presented to the Assembly in the near future. E-JIF 2017 REORGANIZATION MEETING- Mr. Sacco indicated that the E-JIF also held its Reorganization meeting on Wednesday, January 4, He then referred to Commissioner Franz s report on that meeting. RCF 2017 RORGANIZATION MEETING Mr. Sacco noted that the RCF held its Reorganization meeting on January 4, 2017 as well. He then referred to Commissioner Franz s report. (7) South Bergen Municipal J I F

8 SEWER BACKUP CLAIMS Mr. Sacco referred to an enclosed listing of sewer backup claims for the period of October 1, 2016 through December 31, He then asked for a motion to adopt Resolution # authorizing the assessments related to these claims. MOTION TO ADOPT RESOLUTION NO AUTHORIZING THE ASSESSMENTS FOR THE PERIOD OF OCTOBER 1, 2016 THROUGH DECEMBER 31, MOVED: SECOND: VOTE: Commissioner Azzolini Commissioner Van Winkle Unanimous ELECTED OFFICIALS TRAINING Mr. Sacco referred the Committee to the enclosed notice and registration form regarding an upcoming Elected Officials training seminar for members of the South Bergen JIF. He noted that the member will receive a $250 credit for each municipal elected official who completes the course by May 1, He further noted that the credit will also be available for the member s CEO (i.e. municipal manager/administrator). The maximum credit is 25% of the member s workers compensation claim fund. ATTORNEY: Mr. Barbire referred the Committee to his report contained in the agenda booklet and thanked the committee for his reappointment. SAFETY REPORT: Mr. Schulz was present and reviewed the December activities and the January agenda. He referred the Committee to the listing of upcoming MSI training days scheduled through March. Mr. Schulz then referred the various Safety Director bulletins that have been recently distributed to the membership. Safety Report Attached and Made Part of the Minutes UNDERWRITING MANAGER: Mr. Cooney began by highlighting changes for He informed the Board that the MEL increased flood coverage from 75 million to 100 million. He also informed the Board that coverage for owned drones has been added into the casualty program, specifically in general liability regarding owned drones that the municipalities own themselves. Mr. Cooney noted that there are guidelines that need to be followed and the information can be found on the coverage bulletin. (8) South Bergen Municipal J I F

9 Lastly, Mr. Cooney advised that he would like to discuss cyber. He indicated that it is important for members to report cyber claims properly. He advised that if a member believes they have a cyber claim they should report it to the TPA immediately. Mr. Sacco referred to the cyber coverage bulletin and memo regarding reporting cyber losses properly enclosed within the agenda. He then referred to the cyber coverage that the Fund currently has in place with XL Catlin. Mr. Cooney advised that there are increased options with XL Catlin and additional limits with Beazley Insurance. After a brief review of the options, the Board decided to table the topic and revisit it during the February meeting at which time a decision on limits would be made. MANAGED CARE: Underwriting Certificates made part of the Minutes Ms. McGuire referred the Committee to her report contained in the Agenda packet. She informed the Committee that during the month of December, there was a savings of $459, or 73% on the medical billing for Workers Compensation claims. OLD BUSINESS: None NEW BUSINESS: None. PUBLIC COMMENT: Chairman Hansen thanked the Nominating Committee for his re-appointment. MOTION TO ADJOURN MEETING MOTION: SECOND: VOTE: Commissioner Azzolini Commissioner Bianchi Unanimous MEETING ADJOURNED: 5:05 pm NEXT MEETING: February 2017 Lodi Borough Hall Jason Thorpe, Assisting Secretary For Gregory Franz, SECRETARY (9) South Bergen Municipal J I F

10 SOUTH BERGEN MUNICIPAL JOINT INSURANCE FUND SUPPLEMENTAL BILLS LIST Resolution No DECEMBER 2016 WHEREAS, the Treasurer has certified that funding is available to pay the following bills: BE IT RESOLVED that the South Bergen Municipal Joint Insurance Fund s Executive Board, hereby authorizes the Fund treasurer to issue warrants in payment of the following claims; and FURTHER, that this authorization shall be made a permanent part of the records of the Fund. FUND YEAR 2016 Check Number Vendor Name Comment Invoice Amount JOHN HANSEN 2016 MEETING ATTENDANCE 1, , JOSEPH T. CRIFASI 2016 MEETING ATTENDANCE 1, , WITOLD T. BAGINSKI 2016 MEETING ATTENDANCE 1, , GREGORY S. FRANZ 2016 MEETING ATTENDANCE 1, , CHARLES CUCCIA 2016 MEETING ATTENDANCE 1, , AL RESTAINO 2016 MEETING ATTENDANCE 1, , ROBERT COLLETTI 2016 MEETING ATTENDANCE 1, , BRUCE T. MASOPUST 2016 MEETING ATTENDANCE 1, , DOMINICK AZZOLINI 2016 MEETING ATTENDANCE 1, , FRANCIS BIANCHI 2016 MEETING ATTENDANCE 1, , PETER S. VAN WINKLE 2016 MEETING ATTENDANCE 1, , Total Payments FY , TOTAL PAYMENTS ALL FUND YEARS $ 16, (10) South Bergen Municipal J I F

11 RESOLUTION NO SOUTH BERGEN MUNICIPAL JOINT INSURANCE FUND (hereafter referred to as the FUND ) CERTIFYING THE ELECTION OF CHAIRMAN AND SECRETARY BE IT RESOLVED, by the Governing Body of the Fund that the following persons have been elected as Chairman and Secretary: John Hansen Gregory Franz Chairman Secretary BE IT FURTHER RESOLVED, that the Chairman and Secretary shall serve for the year 2017 and until their successors shall be elected and qualified. ADOPTED: this day before the Governing Body, (11) South Bergen Municipal J I F

12 RESOLUTION NO: 2-17 SOUTH BERGEN MUNICIPAL JOINT INSURANCE FUND ( Hereinafter the Fund ) APPOINTING CERTAIN PROFESSIONALS AND SERVICE ORGANIZATIONS WHEREAS, the FUND is duly constituted as a Municipal Joint Insurance Fund, as permitted under the laws promulgated by the State of New Jersey, (N.J.S.A. 40A-36, et. seq.); and WHEREAS, The FUND finds it necessary and appropriate to obtain certain professional services and other extraordinary and other unspecifiable services, as defined in the Local Public Contracts Law, (N.J.S.A. 40A-11 et. seq.) for the 2015, 2016, and 2017 Fund Years. WHEREAS, NJSA 40a11-15 (6) allows for a contract duration of three (3) years; and, WHEREAS, a notice soliciting proposals was published on the Fund s website; and, WHEREAS, the FUND held a bid opening on July 15, 2014 in accordance with a fair and open process pursuant to N.J.S.A. 19:44A-20.4 et. Seq.; and WHEREAS, the Fund s Executive Committee recommended the award of contracts to the below listed Professional Service Providers and service organizations based on a review of their; responses, experience and prior service provided at the rates established by the Fund Executive Committee; and, WHEREAS, the FUND awarded contracts for a three year period for the 2015, 2016 and 2017 Fund years at its January 21, 2015 re-organization meeting (unless otherwise specified); NOW THEREFORE, BE IT RESOLVED that the contracts for the following professionals be re-appointed for the third of the three year term ( ) (unless otherwise specified): NOW, THEREFORE BE IT RESOLVED, by the FUND s Governing Body that: I. Perma Risk Management Services is hereby appointed as Executive Director/Administrator, with Steve Sacco appointed as Executive Director, and David N. Grubb and Joseph Hrubash as Deputy Executive Directors, and all as Agents for process of service. II. III. IV. Paul S. Barbire, Esq., is hereby appointed as Fund Attorney. Contract term to be one year (1/1/17 12/31/17) Joseph Iannaconi, Jr., is hereby appointed as Fund Treasurer. Gary Vinci of Lerch, Vinci & Higgins is hereby appointed as Fund Auditor. V. Conner Strong & Buckelew is hereby appointed as Underwriting Manager. VI. JA Montgomery Risk Control is hereby appointed to provide Loss Control Services and Hazard Communication Training Services (Right To Know). (12) South Bergen Municipal J I F

13 VII. VIII. IX. Bergen Risk Managers is hereby appointed as the Claims Service Organization and as the Managed Care Organization. Russo & Associates, LLC is hereby appointed as the FUND s Internal Auditor. Wilmington Trust is hereby appointed as Asset Manager to the FUND. At an annual fee of 5 basis points on market value of assets. Contract term 1/1/16-12/31/18. X. Charles Gruber of Stergiou & Gruber is hereby appointed as Actuary. XI. Execu-Tech is hereby appointed as the Web Site Development and Hosting Manager (appointment is for a total of one (1) year) at the same rate as (appointment exempt from RFQ process, fees less then $17,500 threshold) XII. Asset Works is hereby appointed as Property Appraiser for the FUND. Contract term 1/1/16-12/31/18. BE IT FURTHER RESOLVED, all Professional Service Providers and Service Organizations appointed pursuant to this Resolution shall service the Fund in accordance with the terms and conditions of the Professional Service contracts attached to this Resolution. BE IT FURTHER RESOLVED, that in accordance with NJSA 19:44A-20.7, the decision of the Fund s Executive Committee that the procurement process utilized, constitutes a fair and open process, shall be final. BE IT FURTHER RESOLVED that the professional service fee compensation for the professionals shall increase 2% for the period of January 1, 2017 through December 31, 2017 unless otherwise noted. Contracts will be provided for each respective professional addressing the increase in fees. ADOPTED: this day by the Governing Body (13) South Bergen Municipal J I F

14 RESOLUTION NO: 3-17 SOUTH BERGEN MUNICIPAL JOINT INSURANCE FUND (hereafter the FUND ) ESTABLISHING PUBLIC MEETING PROCEDURES WHEREAS, the FUND must establish meeting procedures for Fund Year 2017, and NOW, THEREFORE BE IT RESOLVED, by the Governing Body of the FUND that: I. The Governing Body shall conduct Public Meetings at the Lodi Borough Municipal Building, 1 Memorial Drive, Lodi, New Jersey to conduct the official business of the FUND on the third Wednesday of each month at 4:30 P.M. for the 2017 Fund Year and January 17, II. III. Each Public Comment session is limited to thirty (30) minutes; any one person may address the Chairperson for a maximum of five (5) minutes; once a particular topic has been addressed by a member of the public, subsequent comments on that same topic by other people is limited to a maximum of two (2) minutes; citizens who have spoken once during the session will not be recognized a second time; and speakers are required to state their names and addresses. The following is hereby designated the official newspaper (s) of the Fund: The Record, Hackensack, New Jersey and the Fund s webpage IV. ADOPTED: The FUND Secretary or designated assistant shall provide notice of any and all meetings, including special or emergency meetings, to each official newspaper and shall issue all official notices required to be published in at least one of the official newspapers. this day by the Governing Body; (14) South Bergen Municipal J I F

15 RESOLUTION NO: 4-17 SOUTH BERGEN MUNICIPAL JOINT INSURANCE FUND (hereafter referred to as THE FUND ) ESTABLISHING A FISCAL MANAGEMENT PLAN FOR THE 2017 FUND YEAR WHEREAS, THE FUND is duly constituted as a Municipal Joint Insurance Fund, as permitted under the laws promulgated by the State of New Jersey, (N.J.S.A. 40A-36, et.seq.); and WHEREAS, THE FUND is subject to the requirements contained within the Local Fiscal Affairs Law (N.J.S.A. 40A-5, et.seq.) ; and NOW, THEREFORE BE IT RESOLVED by the Board of Fund Commissioners that for the 2017 Fund Year: I. All funds for Administrative Expenses, Reinsurance, Dividends and Miscellaneous Expenses, shall be withdrawn from the Official named Depository (ies) by check, which shall bear the signatures of at least two (2) of the following persons, duly authorized pursuant to this Resolution; JOHN HANSEN GREGORY FRANZ JOSEPH IANNACONI AL RESTAINO CHAIRMAN SECRETARY TREASURER COMMISSIONER II. All funds for Claims payments shall be withdrawn from the Official Depository(ies) by check, which shall bear the signatures of at least two (2) of the following persons, duly authorized pursuant to this Resolution, the Fund Treasurer, Chairman and Secretary or designated Commissioner shall also be a signatory. Robert McGuire Jennifer Ditermer John Markel Kathleen McGuire Jennifer Ditermer Jason Cosimano Manager of Compensation Operations Manager FOR WIRE TRANSFERS - that the FUND does hereby require that Investors Bank obtain voice confirmation prior to executing wire transfers to external accounts from the Fund Treasurer. III. The Cash and Investment Policy attached herewith, shall be adopted. (15) South Bergen Municipal J I F

16 IV. The rate of interest assessed by the Fund, for delinquent assessments shall be ten (10) percent per annum, from the due date for any such assessment. V. Certifying and Approval Officer for all FUND expenses shall be the FUND s Executive Director and/or the Account Manager so designated by the Executive Director. ADOPTED: this day before the Governing Body: (16) South Bergen Municipal J I F

17 SOUTH BERGEN MUNICIPAL JOINT INSURANCE FUND 2017 CASH MANAGEMENT AND INVESTMENT POLICY 1.) Cash Management and Investment Objectives The South Bergen Municipal Joint Insurance Fund (hereinafter referred to as the FUND) objectives in this area are: a.) b.) c.) d.) e.) f.) g.) h.) i.) Preservation of capital. Adequate safekeeping of assets. Maintenance of liquidity to meet operating needs, claims settlements and dividends. Diversification of the FUND's portfolio to minimize risks associated with individual investments. Maximization of total return, consistent with risk levels specified herein. Investment of assets in accordance with State and Federal Laws and Regulations. Accurate and timely reporting of interest earnings, gains and losses by line of coverage in each Fund year. Where legally permissible, cooperation with other local municipal joint insurance funds, and the New Jersey Division of Investment in the planning and execution of investments in order to achieve economies of scale. Stability in the value of the FUND's economic surplus. 2.) Permissible Investments Investments shall be limited to the following: a.) Bonds or other obligations of the United States of America or obligations guaranteed by the United States of America. b.) Government money market mutual funds. c.) Any federal agency or instrumentality obligation authorized by Congress that matures within 397 days from the date of purchase, and has a fixed rate of interest not dependent on any index or external factors. d.) Bonds or other obligations of the local unit or bonds or other obligations of school districts of which the local unit is a part or within which the school district is located. e.) Bonds or other obligations, approved by the Division of Investment of the Department of Treasury for investment by local units. f.) Debt obligations of federal agencies or government corporations with maturities not greater than ten (10) years from the date of purchase, excluding mortgage backed obligations, providing that such investments are purchased through the New Jersey Division of Investment and are consistent the Division's own (17) South Bergen Municipal J I F

18 investment guidelines, and providing that the investment a fixed rate of interest not dependent on any index or external factors. g.) Local Government Investment Pools h.) Repurchase agreements of fully collateralized securities, subject to rules and conditions establish by the N.J. Department of Community Affairs. No investment or deposit shall have a maturity longer than ten (10) years from date of purchase. At any given time, the Fund s investment portfolio shall conform to the following criteria: a) Any bonds or other obligations held by the FUND shall have a minimum longterm investment grade underlying credit rating, or equivalent rating provided by a Nationally Recognized Statistical Rating Organization as outlined by the U.S. Securities and Exchange Commission, with the exception of bonds issued pursuant to the Municipal Qualified Bond Act, which may have an underlying credit rating below investment grade so long as the Municipal Qualified Enhanced Rating is investment grade, or equivalent rating provided by NRSO. b) A minimum of thirty-five (35) percent of aggregate total par amount of bonds and other obligations shall have a minimum long-term, underlying credit rating of AA-, or equivalent rating by an NRSRO. c) The aggregate par amount of bonds or other obligations with a long-term underlying credit rating below A-, or equivalent rating by an NRSRO, shall not exceed thirty (30) percent of the aggregate total par amount of bonds, investments and other obligations held by the Fund. d) The aggregate par amount of bonds or other obligations with maturities longer than five (5) years shall not exceed sixty (60) percent of the aggregate total par amount of bonds, investments and other obligations held by the FUND. Any exception to or deviations from the above criteria must be approved by the New Jersey Division of Local Governmental Services and the New Jersey Division of Investment. 3.) Authorized Depositories In addition to the above, the FUND is authorized to deposit funds in certificates of deposit and other time deposits in banks covered by the Governmental Unit Depository Protection Act, NJSA 17:9-14 et seq. (GUDPA). Specifically authorized depositories are as follows: Wells Fargo Bank Investors Bank Wilmington Trust The FUND is also authorized to invest its assets in the New Jersey Cash Management Fund. 4.) Authority for Investment Management (18) South Bergen Municipal J I F

19 The Treasurer is authorized and directed to make investments, with a maturity of three months or longer, through asset managers that may be selected by the Executive Board. Such asset managers shall be discretionary trustees of the FUND. Their actions and decisions shall be consistent with this plan and all appropriate regulatory constraints. In executing investments, asset managers shall minimize transaction costs by querying prices from at least three (3) dealers and purchasing securities on a competitive basis. When possible, federal securities shall be purchased directly from the US Treasury. Transactions shall not be processed through brokerages which are organizationally affiliated with the asset manager. Transactions may also be processed through the New Jersey Division of Investment by the Fund's asset managers. 5.) Preservation of Capital Securities shall be purchased with the ability to hold until maturity. 6.) Safekeeping Securities purchased on behalf of the FUND shall be delivered electronically or physically to the FUND's custodial bank, which shall maintain custodial and/or safekeeping accounts for such securities on behalf of the FUND. 7.) Selection of Asset Managers, Custodial Banks and Operating Banks Asset managers, custodial banks and operating banks shall be retained for contract periods of one (1) year. Additionally, the FUND shall maintain the ability to change asset managers and/or custodial banks more frequently based upon performance appraisals and upon reasonable notice, and based upon changes in policy or procedures. 8.) Reporting 9.) Audit Asset managers will submit written statements to the treasurer and executive director describing the proposed investment strategy for achieving the objectives identified herein. Asset managers shall also submit revisions to strategy when justified as a result of changing market conditions or other factors. Such statements shall be provided to the Treasurer and Executive Director. The statements shall also include confirmation that all investments are made in accordance with this plan. Additionally, the Investment Manager shall include a statement that verifies the Investment Manager has reconciled and determined the appropriate fair value of the Funds portfolio based on valuation guidelines that shall be kept on file in the Executive Director s office. The Treasurer shall report to the Executive Committee at all regular meetings on all investments. This report shall include information on the balances in all bank and investment accounts, and purchases, sales, and redemptions occurring in the prior month. (19) South Bergen Municipal J I F

20 This plan, and all matters pertaining to the implementation of it, shall be subject to the FUND's annual audit. 10.) Cash Flow Projections Asset maturity decisions shall be guided by cash flow factors payout factors supplied by the Fund Actuary and reviewed by the Executive Director and the Treasurer. 11.) Cash Management All moneys turned over to the Treasurer shall be deposited within forty-eight (48) hours in accordance with NJSA 40A:5-16. In the event a check is made payable to the Treasurer rather than the Fund, the following procedure is to be followed: a.) b.) The Treasurer endorses the check to the Fund and deposits it into the Fund account. The Treasurer notifies the payer and requests that in the future any check be made payable to the Fund. Cash may be withdrawn from investment pools under the discretion of asset managers only to fund operations, claims imprest accounts, or approved dividend payments. The Treasurer shall escheat to the State of New Jersey checks which remain outstanding for twelve or more months after the date of issuance. However, prior to implementing such procedures, the Treasurer, with the assistance of the claims agent, as needed, shall confirm that the outstanding check continues to represent a valid claim against the FUND. (20) South Bergen Municipal J I F

21 RESOLUTION NO SOUTH BERGEN MUNICIPAL JOINT INSURANCE FUND (Hereinafter the FUND ) ESTABLISHING A FUND RECORDS PROGRAM WHEREAS: The FUND must establish a formal record retention program for the 2017 Fund Year. NOW, THEREFORE BE IT RESOLVED, by the FUND s Governing Body that: I. Gregory Franz Fund Secretary, is hereby designated as custodian of the FUND records, which shall be kept at the office of the Fund Administrator, located at 9 Campus Drive, Suite 216, Parsippany, NJ II. Jason Thorpe, Account Manager for Perma Risk Management Services is hereby designated as Assistant Fund Secretary. III. IV. The records of the FUND shall be retained in accordance with the municipal records retention schedule as promulgated by the New Jersey Division of Archives and Records Management, and/or otherwise specified by the New Jersey Department of Insurance and Community Affairs. Each fund professional and service organization shall have the duty and obligation to maintain such records as are entrusted to him/her and to relinquish such records to the Fund Secretary upon termination of services or otherwise upon request. Records and files not required to support current operations, but which must otherwise be retained, shall be stored in the record retention facility, located at Route 80, Business Archives, 24 Beckwith Avenue, Paterson, New Jersey. The FUND s Executive Director shall coordinate the archive process and shall make sure that all records are properly indexed and accessible. ADOPTED: this day before the Governing Body (21) South Bergen Municipal J I F

22 RESOLUTION NO South Bergen Municipal Joint Insurance Fund (hereinafter the "Fund") ESTABLISHING THE 2017 PLAN OF RISK MANAGEMENT BE IT RESOLVED by the Fund's governing body that the 2017 Plan of Risk Management shall be: I: The perils or liability to be insured against. The Fund insures the following perils or liability: A) Workers' Compensation including Employer's Liability, USL&H and Harbor Marine/Jones Act. B) General Liability including Police Professional Liability, Employee Benefits Liability, Garagekeeper's Liability, Failure to Supply (water and electricity), Riot, Civil Commotion or Mob Action, Good Samaritan, Disinfecting Agents Release Hazard, and Skateboard Facility. C) Automobile Liability including PIP and uninsured/underinsured Motorists Coverage. D) Property including Boiler and Machinery E) Public Officials and Employment Practices Liability F) Volunteer Directors & Officers Liability G) Cyber Liability H) Optional Tenant Users Liability Insurance (TULIP) Coverage includes general liability and liquor liability at the limit of liability as established by the TULIP program. The policy is written in the tenant/users name with the member entity as an additional insured. Coverage goes into effect upon the member entity subscription to the program and program setup for the member entity by the TULIP program administrator. I) Excess Workers' Compensation J) Non-Owned Aircraft Liability K) Crime including 1: excess public employee coverage 2: excess public officials coverage where the Statutory Positions coverage is insured commercially for primary coverage 3: coverage for Statutory Positions insured on a primary basis with MEL (where approved) L) Environmental Impairment Liability Coverage is provided to the Fund's member local units by the Fund's membership in the New Jersey Municipal Environmental Risk Management Fund (i.e. E-JIF.) M) Pollution and Mold Legal Liability Coverage for the Fund s member Boards of Education is provided to the Fund s membership in the SPELL JIF. For details please refer to the SPELL JIF Risk Management Plan II: The limits of coverage. A) Workers' Compensation limits. (22) South Bergen Municipal J I F

23 1: The Fund covers $300,000 CSL. 2: Employers Liability: $300,000 3: USL&H Included 4: Harbor Marine/Jones Act Included in employers liability 5: Incidental Foreign Workers Compensation included 6: Communicable Disease Coverage included B) General Liability limits. 1: The Fund covers $300,000 CSL. 2: General Liability: Included 3: Law Enforcement Professional Liability: Included 4: Real Property-Liability-Fire: Included 5: Employee Benefits Liability: Included 6: Lead Annual Aggregate: $300,000 7: Assisted Living Facilities Defense Annual Aggregate: $50,000 C) Automobile Liability limits. 1: Bodily Injury and Property Damage Combined Single Limit: $300,000 2: Garagekeepers Liability: Included 3: NJ PIP: $250,000 4: NJ UM/UIM: Included D) Non-Owned Aircraft. The MEL covers $300,000 CSL for Bodily Injury and Property Damage Liability, and $5,000 medical expense for each passenger. E) Public Officials Liability/Employment Practices Liability. (POL/EPL) 1: The JIF is 100% commercially insured with QBE Specialty Insurance Company for $2,000,000 in the aggregate on a claims made basis per member municipality for each Fund year subject to a member local unit deductible and coinsurance. 2: $20,000 is the standard deductible per occurrence, although other deductibles may apply. 3: 20% coinsurance of the first $250,000 of the loss is the standard coinsurance, although other coinsurance percentages may apply. 4: NOTE: Member local units may qualify based on certain criteria to have options to purchase a lower deductible and coinsurance contribution. New members with adverse loss experience may be subject to higher deductibles and coinsurance. (23) South Bergen Municipal J I F

24 F) Volunteer Directors and Officers Liability (VDO) - Fire Companies and Emergency Service Units. 1: The JIF, 100% commercially insured with QBE Specialty Insurance Company, provides optional coverage for Fire Companies or Emergency Service Units per the following options: Option Limit of Liability Deductible 1 $1,000,000 $1,000 2 $1,000,000 $2,000 3 $1,000,000 $5,000 4 $2,000,000 $1,000 5 $2,000,000 $2,000 6 $2,000,000 $5,000 G) Property 1: The Fund covers $300,000 per occurrence (Property & Time Element combined) less applicable member deductibles. 2: The MEL serves as the lead agency for the purchase of additional excess property at the following MEL statewide limits and sub-limits. 3: Boards of Education excess property coverage with limits of $250,500. 4: Deductibles $500,000 $50,000 Per Occurrence (Property Damage & Time Element) Equipment Breakdown (Property Damage) $50,000 Equipment Breakdown (Time Element) $500,000 Flood, SFHA Buildings $500,000 Flood, SFHA Time Element $500,000 Flood, SFHA Contents $250,000 $100,000 Flood, SFHA Housing Authority/Non-Profit Buildings Flood, SFHA Housing Authority/Non-Profit Contents $100,000 Flood, SFHA Housing Authority/Non-Profit Time Element $500,000 Pumping Stations, Lift Stations, Wet Wells, Pistol Ranges, Vehicles and Mobile Equipment, and all property located outside building or structure, but not defined as Outdoor Property (Property Damage) $500,000 Pumping Stations, Lift Stations, Wet Wells, Pistol Ranges, Vehicles and Mobile Equipment, and all property located outside building or structure, but not defined as Outdoor Property (Time Element) 1% Named Storm: Covered Property in Atlantic, Ocean, Monmouth and Burlington Counties East of the Garden State Parkway and all Covered Property in Cape May (Property Damage) 1% Named Storm: Covered Property in Atlantic, Ocean, Monmouth and Burlington Counties East of the Garden State Parkway and all Covered Property in Cape May (Time Element) (24) South Bergen Municipal J I F

25 $500,000 Named Storm Minimum, Per Location (Property Damage & Time Element) Covered Property in Atlantic, Ocean, Monmouth and Burlington Counties East of the Garden State Parkway and all Covered Property in Cape May $1,000,000 Named Storm Maximum, Per Occurrence (Property Damage & Time Element) Covered Property in Atlantic, Ocean, Monmouth and Burlington Counties East of the Garden State Parkway and all Covered Property in Cape May 5: Other Special Provisions Cape May Convention Center The policy insures direct physical loss or damage caused by a Covered Cause of Loss at the Cape May Convention Center. Ocean City Music Pier The policy insures direct physical loss or damage caused by a Covered Cause of Loss at the Ocean City Music Pier. Bridges & Dams Bridges and dams attached to an insured location, and the relating equipment, are covered, except for Flood, Earthquake and Named Storm. Piers, Wharfs, Docks, Bulkheads and Boardwalks All are covered, including any crossovers, floating docks and the buildings/structures thereon against the perils of fire, lightning, explosion, smoke, windstorm, hail, riot, civil commotion, aircraft, vehicles, vandalism, sprinkler leakage, sinkhole collapse, volcanic action, watercraft and malicious intent. Utilities The following are covered: - Transmission and distribution lines situated beyond 1 mile radius of insured location for above ground transmission. - Transmission and distribution lines situated beyond 5 mile radius of insured location for below ground transmission. Outdoor Property Outdoor Property means Covered Property not at an Insured Location and: (25) South Bergen Municipal J I F

26 - Outside a permanent building, or not wholly enclosed by walls and a roof; or - Inside a moveable container located outside a permanent building. Covered for the perils of fire, lightning, explosion, smoke, windstorm, hail, riot, civil commotion, aircraft, vehicles, vandalism, sprinkler leakage, sinkhole collapse, volcanic action, watercraft and malicious intent. Retaining Structures Retaining structures are only covered if attached to a scheduled location. Underground Piping Excludes: - Underground piping beyond a 1,000 foot radius of a pump station, process plant, metering pit, well or similar operational location, which is owned, leased, used, occupied or intended for use by the member entity; - Underground Storage Tanks and associated systems including piping; - Underground electric, data voice, digital, fiber optic or similar cable beyond a 1,000 foot radius of an insured location owned by the member entity; and - Underground gas pipelines. Vacant and Historic Property Vacant Buildings: - Vacant Building: A building containing nothing; being without contents or occupants. - Except as noted below, the JIF will only provide Named Perils coverage on an Actual Cash Value basis for any vacant building. (26) South Bergen Municipal J I F

27 - The Underwriting Manager may provide Replacement Cost valuation with All-Risk coverage for any vacant building after the completion of a satisfactory inspection by the Underwriting Manager s office and/or the insurers to verify building condition, security of the building, and status of utilities. Historic Property: - Historic Property: Any property appearing in the local register of Historic Places, National Historic Landmarks Program, or National Register of Historic Places. - Cost to replace, repair or restore using the same materials, workmanship and architectural features and details that existed before such loss provided they are available. If any materials or workmanship needed to replace, repair or restore a building or structure are not available, the cost to use materials and/or workmanship that will permit the replacement, repair or restoration of the building to a condition that most closely resembles the condition which existed immediately before the loss occurred will be utilized. - If there is an ordinance or law in effect at the time of loss that regulates zoning, land use or construction of a historic building (such as a Historic Preservation Act or other similar regulation), if that ordinance or law affects the repair or rebuilding of the historic building, and if you: Repair or rebuild the building or structure as soon as reasonably possible, then you will receive Replacement Cost valuation on the damaged and undamaged portions of the building, the cost to demolish and clear the site of the undamaged portion of the building, and the increased cost to repair or rebuild the building to the same general (27) South Bergen Municipal J I F

28 size in accordance with the minimum standards of such ordinance or law; Do not repair, rebuild or replace the building or structure, then you will receive Actual Cash Value valuation on the damaged and undamaged portions of the building, plus the cost to demolish and clear the site of the undamaged portion of the building. - With respect to properties that qualify for "National Historic Landmark status, the Insured shall have the sole discretion as to the means by which said property shall be repaired, rebuilt or replaced, but not to exceed the actual costs which would have been incurred in order to comply with "National Historic Landmark status requirements. H) Blanket Crime - The JIF provides a limit of $300,000 less the member entity deductible of $2,500. Coverage includes Public Employee Dishonesty, Forgery and Alteration, Theft, Disappearance and Destruction, Robbery and Safe Burglary, Computer Fraud with Funds Transfer. Boards of Education crime coverage with limits of $250,500 (includes member entity deductible of $500). I) Environmental Impairment Liability - The limits of liability as established in the E-JIF's Plan of Risk Management and coverage documents. J) Cyber Liability The JIF, 100% commercially insured with Indian Harbor Insurance Company, provides Third Party coverage including Media Communication, Network Security Liability and Privacy Liability, and First Party coverage including Extortion Threat, Crisis Management Expenses and Privacy Notification Costs. The JIF limits of liability are $3,000,000 each/$6,000,000 policy aggregate. The limits are JIF-wide and shared amongst member local units of the JIF. There is a $10,000 policy deductible. There is a $3,000,000 sublimit for Third Party Coverages and a $3,000,000 sublimit for First Party Coverages. K) Optional Tenant Users Liability Insurance (TULIP) Optional coverage includes general liability and liquor liability at the limit of liability as established by the TULIP program. The policy is written in the tenant/users name with the member entity as an additional insured. Coverage goes into effect upon the member entity subscription to the program and program setup for the member entity by the TULIP program administrator. III: The amount of unpaid claims to be established. A) The general reserving philosophy is to set reserves based upon the probable total cost of the claim at the time of conclusion. Historically, on claims aged eighteen (28) South Bergen Municipal J I F

29 (18) months, the Fund expects the claims servicing company to set reserves at 85% accuracy. The Fund also establishes reserves recommended by the Fund's actuary for claims that have been incurred but not yet reported so that the Fund has adequate reserves to pay all claims and allocated loss adjusted expense liability. B) Claims reserves are subject to regular review by the Fund's Executive Director/Administrator, Attorney, Executive Committee and claims servicing company. Reserves on large or unusual claims are also subject to review by the claims departments of the commercial insurance companies or reinsurance companies providing primary or excess coverages to the Fund. IV: The method of assessing contributions to be paid by each member of the Fund. A) By November 15th of each year, the actuary computes the probable net cost for the upcoming Fund year by line of coverage and for each prior Fund year. The actuary includes all budget items in these computations. The annual assessment of each participating municipality is its pro rata share of the probable net cost of the upcoming Fund year for each line of coverage as computed by the actuary. B) The calculation of pro rata shares is based on each municipality's experience modified manual premium for that line of coverage. The Fund's governing body also adopts a capping formula which limits the increase of any member's assessment from the preceding year to the Fund wide average increase plus a percentage selected by the governing body. The total amount of each member's annual assessment is certified by majority vote of the Fund's governing body at least one (1) month prior to the beginning of the next fiscal year. C) The treasurer deposits each member's assessment into the appropriate accounts, including the administrative account, and the claim or loss retention trust fund account by Fund year for each type of coverage in which the member participates. D) If a local unit becomes a member of the Fund or elects to participate in a line of coverage after the start of the Fund year, such participant's assessments and supplement assessments are reduced in proportion to that part of the year which had elapsed. E) The Fund's governing body may by majority vote levy upon the participating municipalities additional assessments wherever needed or so ordered by the Commissioner of Insurance to supplement the Fund's claim, loss retention or administrative accounts to assure the payment of the Fund's obligations. All supplemental assessments are charged to the participating municipalities by applicable Fund year, and shall be apportioned by the year's assessments for that line of coverage. In the event that the Fund adopts a deferred payment plan for an additional assessment, any member leaving the Fund shall immediately pay the Fund the full amount of its share of any deferred supplemental assessment. F) Should any member fail or refuse to pay its assessments or supplemental assessments, or should the Fund fail to assess funds required to meet its (29) South Bergen Municipal J I F

30 obligations, the chairman or in the event by his or her failure to do so, the custodian of the Fund's assets, shall notify the Commissioner of Insurance and the Director of Community Affairs. Past due assessments shall bear interest at the rate established annually by the Fund's governing body. G) The Fund has also adopted a loss sensitive retrospective rating plan and has filed the endorsement with the Department of Banking and Insurance and the Department of Community Affairs. In the event that the Fund adopts a deferred payment plan for retrospective premiums, any member leaving the Fund shall immediately pay the Fund the full amount of its deferred retrospective premium.. H) The Fund has further adopted a cash flow premium plan that permits a member to defer up to one-third of its premium to the next fund year, provided however, that the maximum deferral shall be reduced by the amount of any additional assessment a member has elected to defer. In the event that a member leaves the Fund, it shall immediately pay the Fund the full amount of any deferred premium. I) Each year, each member shall be assessed at least 10% of its outstanding deferred additional assessments and deferred retrospective premium. J) The Fund has also adopted a loss sensitive retrospective rating plan and has filed the endorsement with the Department of Banking and Insurance and the Department of Community Affairs. V: Procedures governing loss adjustment and legal expenses. A) The Fund engages a claims service company to handle all claims, except for the JIF s POL/EPL Volunteer D&O and Cyber Liability insurance which is handled by Summit Risk Services. The performance of the claims adjusters is monitored and periodically audited by the Executive Director's office, the Fund attorney, the MEL's attorney's office, as well as the claims department of the MEL's three major liability insurers/re-insurers [i.e. General Re and Munich Re for excess liability, and Safety National for workers' compensation]. Every three years, the MEL's internal auditors also conduct an audit. B) Each member local unit is provided with a claims reporting procedure and appropriate forms. C) In order to control workers' compensation medical costs, the Fund has engaged a managed care organization (MCO) whose procedures are integrated into the Fund's claims process. D) To provide for quality defense and control costs, the Fund has established an approved defense attorney panel with firms which specialize in Title 59 matters. The performance of the defense attorneys is overseen by the Fund attorney, as well as the various firms which audit the claims adjusters. VI: Coverage to be purchased from a commercial insurer. (30) South Bergen Municipal J I F