MISSION STATEMENT The Risk Management Fund supports the City and Borough Risk Management Programs. Risk Management is committed to preventing injury and loss to citizens and employees as a result of City and Borough operations and minimizing the possibility of catastrophic loss to the City and Borough of Juneau through application of sound risk management techniques. Risk Management attempts to provide the best possible health benefits for our employees at the most economical cost to the City and Borough. The Division also administers the Employee Assistance Program for the CBJ. FUNCTIONAL ORGANIZATION CHART CITY AND BOROUGH MANAGER'S OFFICE RISK MANAGEMENT OFFICER Tim Allen Risk and Insurance Management Safety and Loss Control Claims Management Health Benefits, Group Life and Wellness Employment Security Administrative Support 393
STAFFING ORGANIZATION CHART Risk Management Officer 1.0 PFT Office Assistant II 1.0 PFT Safety Officer 1.0 PFT Risk Management Technician 1.0 PFT See Employment Status in Glossary for definitions of PFT, PPT, PTL and PS 394
OVERVIEW FY03 FY04 FY01 Amended EXPENSES: Actuals Actuals Personnel Services $ 180,000 229,700 198,700 248,800 257,000 Commodities and Services 7,891,400 8,075,800 9,033,800 10,668,100 11,427,100 Total Expenses 8,071,400 8,305,500 9,232,500 10,916,900 11,684,100 FUNDING SOURCES: Intergovernmental User Fees Other Revenues 5,924,800 513,000 7,031,700 305,000 7,586,100 344,400 10,528,200 412,700 11,237,800 730,400 Equity (to) from Fund Balance 1,633,600 968,800 1,302,000 (24,000) (284,100) Total Funding Sources $ 8,071,400 8,305,500 9,232,500 10,916,900 11,684,100 STAFFING 4.00 4.00 4.00 4.00 4.00 FUND BALANCE $ 2,150,300 1,181,500 848,300 872,300 1,156,400 BUDGET HIGHLIGHT The Risk Management FY03 represents an increase of $2,611,400 (31.4%) from the Amended. The FY04 is $767,200 (7.0%) greater than the FY03. The significant budgetary changes include: FY03 Personnel services increased $19,100 to reflect negotiated changes in the wage rate and increases in health care costs. Health and Wellness costs increased $1,549,600 due to medical cost increases far greater than the general inflation rate. Medical costs are projected to increase 9.5% annually while prescription drug costs are projected to increase 25% annually. Liability, property, general, auto and special insurance premiums increased $856,600 due to unfavorable conditions in the commercial insurance market. Workers compensation claims increased $159,100 due to higher anticipated claims cost resulting from the increase in medical costs. Intergovernmental user fee revenue increased $3,496,500 due to the need to recover the increased costs incurred and the prior biennial budget reduction in rates to utilize fund balance. Other revenues include $58,300 in new revenues from anticipated employee co-payments for health insurance. 395
BUDGET HIGHLIGHT CONTINUED FY04 Health and wellness costs increased $701,600 due to the anticipated continuation in the growth of medical and prescription drug costs. Intergovernmental user fee revenue increased $709,600 to recover the increase in health and wellness costs. Other revenues include $366,000 from anticipated employee co-payments for health insurance. PROGRAM DESCRIPTION Risk Management/Insurance The Risk Management Office has, as its ultimate objective, the preservation of the City & Borough of Juneau s assets. As a means to that end, the Risk Manager has the responsibility of formulating and implementing programs and procedures that will minimize the CBJ s property, revenue, and personnel losses. Risk Management is a four-step process used to determine the best way to protect the CBJ assets. The first step is to identify and evaluate all types of losses to which the CBJ might be exposed. Secondly, alternative risk management techniques to treat those loss exposures are analyzed. Next, the most viable risk management techniques for the loss exposure are selected and implemented. That combination of risk management techniques constitutes the risk management program for CBJ. The fourth step in the process is constant monitoring of the program to ensure that the techniques selected are still the most viable ones. Changes in economic conditions or other factors make the process cyclical as it does not stop once a program has been implemented. Loss exposures that have been identified for the CBJ fall into the following categories:! Property (buildings and contents)! General liability! Excess liability! Workers Compensation! Automobile liability! Professional liability! Employee fidelity! Airport liability! Bartlett Memorial Hospital/Juneau Recovery Hospital liability! Eaglecrest Ski Area liability! Harbors, Docks and Marina Operators liability All of these exposures are quite different from each other, are governed by different laws and statutes, and must be handled in different ways. Consequently, no single risk management technique can be aptly applied to all CBJ exposures. Rather, a combination of risk control and risk financing techniques must be utilized to minimize the CBJ losses. Risk control techniques (i.e. loss prevention and loss control) are used to lower the frequency and severity of losses. Since some losses will inevitably befall the CBJ, risk-financing techniques (i.e. conventional insurance, self-insurance) must be utilized to fund these losses at the lowest possible cost. 396
PROGRAM DESCRIPTION - CONTINUED CBJ has a comprehensive insurance program designed to finance the losses that do occur. The CBJ utilizes the services of two insurance brokers, and as many as twenty-nine insurance carriers to provide adequate insurance protection. The risk management office administers the insurance program and manages all claims on the CBJ s behalf. The CBJ purchases primary and excess property and general liability insurance coverage with a $25,000 deductible. Worker s compensation excess insurance carries a $350,000 self-insured retention. The Risk Management program provides the methodology for financing the CBJ insurance program through departmental allocations based upon tracked experience. The CBJ Risk Management Program is considered to be an appropriate one, given current conditions. Risk Management, will, however, continually monitor the program as well as internal and external conditions that affect the program to assure that it continues to be the most appropriate program to meet the CBJ s needs. When it is determined that the program no longer meets the needs in the most efficacious manner, adjustments to the program will be made. FY03 FY04 Workload Indicators FY01 Actuals Draft service contracts 4 5 5 5 Property/Casualty/Auto Claims Management 60 70 70 70 Worker s Compensation Claims Manager 150 150 150 150 Review contractual insurance requirements 150 150 150 150 Respond to public phone calls 500 500 500 500 Prepare annual renewal insurance specifications 1 1 1 1 Prepare loss reports 12 12 12 12 Special projects re: liability issues 12 12 12 12 Prepare billing for insurance premiums, goods and services 150 150 150 150 Meeting with brokers/insurance underwriters (in Seattle) 2 3 4 4 Weekly meetings with CBJ contracting staff 50 50 50 50 Monthly meetings with BRH Administration 12 12 12 12 Monthly meetings with Juneau School District Admin. 12 8 12 12 Attend Workers Compensation hearings - 2 2 2 397
PROGRAM DESCRIPTION - CONTINUED Safety and Loss Control This effort utilizes several different means to achieve one important end; employee awareness. This service provides and integrated and structured program for CBJ-wide incident investigation of injuries, property and equipment damage, and near misses. It provides a necessary focal point intended to assure follow-up to the investigation for employees and managers alike. Through inspections, safety meetings, safety training, and the investigation reports all hazardous conditions and dangerous practices are identified. Our service is operative in the active elimination of hazards and the abatement of potential liabilities. Management of the worker s compensation program is included in this section of Risk Management. FY03 FY04 Workload Indicators FY01 Actuals Conduct work site evaluations 15 15 15 15 Accompany OSHA on site inspections 2 6 4 4 Attend department safety meetings 20 20 20 20 Conduct 40 hour Hazardous Materials Training 1 2 2 2 Prepare health and safety plans/update 7 7 7 7 Attend formal training (OSHA) course(s) seminars 1 1 1 2 Conduct industrial hygiene sampling - 10 20 20 Conduct 10-hour construction training - - 3 3 FY03 & FY04 GOALS AND OBJECTIVES Risk Management GOAL VERIFY APPROPRIATE LIMITS FOR BUSINESS INTERRUPTIONS INSURANCE COVERAGE FOR ALL CBJ DEPARTMENTS, BARTLETT REGIONAL HOSPITAL AND JUNEAU SCHOOL DISTRICT. Objectives Conduct onsite meetings with financial administrators for all of the above listed entities. Submit a written business interruption loss analysis to all CBJ property/casualty insurer. Completion Date Ongoing Ongoing GOAL CONTAIN COSTS FOR THE CBJ HEALTH INSURANCE BENEFIT PLAN WHILE CONTINUING TO PROVIDE A SATISFACTORY BENEFIT PACKAGE TO CBJ EMPLOYEES. Completion Date Objectives Perform a complete health benefit plan review and make recommendations to the CBJ Health Benefits Committee and CBJ management. 07/02 398
FY03 & FY04 GOALS AND OBJECTIVES - CONTINUED GOAL PROVIDE INFORMATION TO THE JUNEAU AIRPORT BOARD ABOUT PROPOSED INSURANCE REQUIREMENTS FOR USERS OF THE AIRPORT FACILITY. Completion Date Objectives Research and analyze insurance requirements used by other airports similar to the Juneau Airport. 07/03 Meet with the Airport Board and present a report of findings. 07/03 GOAL CREATE A WEBSITE FOR EMPLOYEE HEALTH AND WELLNESS INFORMATION AND SAFETY AWARENESS ON THE JOBSITE. Objectives Completion Date Meet with the webmaster to determine feasibility and creation of web site 07/03 Safety and Loss Control GOAL IMPLEMENT THE OCCUPATIONAL SAFETY AND HEALTH ADMINISTRATION (OSHA) STAR PROGRAM OF THE STATE OF ALASKA VOLUNTARY PROTECTION PROGRAM (VPP), ADMINISTERED BY THE ALASKA DEPARTMENT OF LABOR AND WORKFORCE DEVELOPMENT. VPP PARTICIPANTS GENERALLY EXPERIENCE 60 TO 80 PERCENT FEWER LOST WORKDAY INJURIES THAN WOULD BE EXPECTED OF AN AVERAGE SITE OF THE SAME SIZE. WORKER S COMPENSATION COST ARE REDUCED AND EMPLOYEES PROVIDE BETTER QUALITY AND PRODUCTIVITY. Objectives Commit management to provide the motivating force and resources for employees to use as the means through which they express their own dedication to safety and health protection. Identify existing hazards and conditions/operations to anticipate changes, which might occur to create hazards. Provide continuous training to address the safety and health responsibilities and concerns of CBJ employees. FY03 Completion Date Ongoing Ongoing Ongoing FY04 Key Measures FY01 Actuals Complete OSHA provided Self-Assessment (site) Check list 1 1 1 1 Prepare VPP Application for submission to OSHA - - 1 - Request AK. Dept. of Labor initial site evaluation - - 10 - Appoint Department/Division Safety representatives 10 10 18 - Conduct site evaluations 12 12 20 20 Develop and conduct health and safety training classes 10 12 12 12 399
EXPENSES FY03 FY04 FY01 Amended Administration: Actuals Actuals Personnel Services $ 180,000 229,700 198,700 248,800 257,000 Commodities and Services 55,100 70,300 64,700 103,000 95,000 Total Adminstration 235,100 300,000 263,400 351,800 352,000 Employee Assistance Program: Commodities and Services 43,500 46,200 46,900 50,000 50,000 Insurance Policies Premiums: Commodities and Services 1,077,300 1,168,300 1,301,400 2,024,900 2,024,900 Departmental Claims: Commodities and Services 746,100 898,400 1,021,000 1,072,100 1,125,700 Unemployment Claims: Commodities and Services 212,100 178,400 130,600 144,000 148,000 Health, Life and Wellness Program: Commodities and Services 5,635,300 5,590,200 6,341,000 7,141,600 7,846,500 Consultant Services: Commodities and Services 122,000 124,000 128,200 132,500 137,000 Total Expenses $ 8,071,400 8,305,500 9,232,500 10,916,900 11,684,100 FUNDING SOURCES CLASSIFICATIONS: Intergovernmental User Fees: Workers compensation 188,900 FY03 FY04 FY01 Amended Actuals Actuals $ 80,000 80,000 600,000 600,000 General liability Unemployment compensation 90,100 173,600 210,000 177,500 210,000 135,200 1,200,000 139,800 1,200,000 144,400 Special policy premiums 648,700 652,000 683,100 1,076,000 1,076,000 Health, life, and wellness 4,823,500 5,912,200 6,477,800 7,512,400 8,217,400 Total 5,924,800 7,031,700 7,586,100 10,528,200 11,237,800 Other Revenues 513,000 305,000 344,400 412,700 730,400 Equity (to) from Fund Balance 1,633,600 968,800 1,302,000 (24,000) (284,100) Total Funding Sources $ 8,071,400 8,305,500 9,232,500 10,916,900 11,684,100 400
STAFFING DETAIL CLASS TITLE: Administration Risk Management Officer 1.00 62,200 FY03 FY04 Amended No. Salary & Benefits No. Salary & Benefits No. Salary & Benefits Pos. Pos. Pos. Safety Officer 1.00 $ 51,200 1.00 1.00 $ 66,500 52,800 1.00 1.00 $ 67,100 54,000 Secretary I 1.00 32,400 1.00 36,200 1.00 37,600 Office Assistant II 1.00 25,000 1.00 25,400 1.00 26,300 Benefits - 58,900-67,900-72,000 Total 4.00 $ 229,700 4.00 $ 248,800 4.00 $ 257,000 401
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