HomeMy WebLinkAboutResolutions 84-115 N.C.S. 06/04/1984i- . SON - 4 1984 5
Resolution No. 8 4 -115 N. C. S.
of the City of Petaluma, California
RESOLUTION OF THE CITY COUNCIL PERTAINING TO
A DEFERRED PREMIUM PLAN FOR WORKERS'. COMPENSATION INSURANCE
AND AUTHORIZING THE MAYOR OR CITY MANAGER TO EXECUTE A
PROMISSORY NOTE AND MEMORANDUM OF AGREEMENT THEREFOR
WHEREAS, the City of Petaluma purchases Workers' Compensation
Insurance coverage from the State Compensation Insurance Fund; and,
WHEREAS, recent changes to administrative regulations now allow local
agencies to participate in Deferred Premium Collection Plans; and,
WHEREAS, participation by the. City would . result in cash flow savings
to the City of Petaluma;
NOW, THEREFORE., BE IT RESOLVED that the Mayor or City Manager
is hereby authorized to issue a Deferred Premium Collection Plan Promissory
Note for Workers' Compensation and enter into .a Memorandum of Agreement
in the form .attached hereto as Exhibit "A", for the policy period July 1,
1984 to June 30, 1985; and,
BE IT FURTHER RESOLVED that State Compensation Insurance Fund is
hereby named the beneficiary of the note and pledges revenues, namely
Franchise Taxes Revenue, in the amount of $188, 400 plus interest thereon,
per terms of the note.
J Ati
Under the power and authority conferred upon this Council by the Charter of said City.
I hereby certify the foregoing Resolution was introduced and ado]
Council of the City of Petaluma at a (Regular) (,Qji AileAV (4S ci
on the .......---..lth..... day of ............... J.Uae................................. 19..
following vote:
AYES: Cavanagh/Balshaw/V.M. Harberson/Mayor Mattei
NOES: None
ABSENT: per Batta a/ d
i
ATTEST: ................. // ...........
City Clerk Mayor
Council File ................ ...................
Form CAB 7181 Res.: No ..... 8 4.-.1:.1:.......N . C . S .
P( RLIC AGENCY
DEFERRED PREMIUM COLLECTION' PLAN
PROMISSORY NOTE
19 8, 4
(policy year)
JUN - 4 1984
5 :
S188,400 19
(date of making)
(place of making)
SECTION ONE
TERMS OF' NOTE
For value received, City of Petaluma of P.O. Box 61,
City of Petaluma, County of Sonoma, State of California,
herein referred to as maker, promises to pay to the order of
State Compensation Insurance Fund, herein referred to as
payee, at 1275 Market Street, City of San Francisco, County
of San Francisco, State of California, on July 1, 1986, or
at the time of dividend* calculation for the, policyholder as
provided for in the State Fund authorized dividend plan,
whichever occurs first, the principal sum of One Hundred
Eighty Eight Thousand Four Hundred Dollars ($188,400) with
interest from July 1, 1984, at the rate of One and one-half
(1 1/2) percentage points below the Bank of America prime
rate of interest effective July 1, 1984, payment to be made
in one lump sum. This Note will be amended effective July
1, 1984, to provide the fixed rate of interest.
Effective January 1, 1984, Government Code Section
53531 allows that the maximum interest rate allowable on
this Note is ten percent,(10%) peer year unless a higher rate
is permitted by law.
ASUWL
COMPENSATION
I N S U R A N C E
1275 MARKET STREET • SAN FRANCISCO, CALIFORNIA 94103
SCIF FORM U-99 (NEW 10-77)
Ci ty, of Pe taluma
RE: Deferred Premium
Collection Plan
Page 2 of 3
SECTION TWO
RECITAL OF CONSIDERATION
This instrument is issued pursuant to the terms of the
workers' compensation insurance contract policy #28061-84
.and memorandum of agreement entered into on
19 , between the maker- and payee of this instrument.
SECTION THREE
COLLATERAL
Maker is furnishing collateral security for the
indebtedness evidenced by this Note by Resolution of the
City of Petaluma Governing Board guaranteeing .payment.
The principal and interest earned on this Note are due
and payable in cash on demand if this Note ceases to be
fully secured.
SECTION FOUR
WAIVER OF PRESENTMENT, PROTFST, AND NOTICE OF DISHONOR
Each maker and each endorser of this Note waives
presentment, protest, and notice of dishonor and any other
notice that may be required.
COMPENSATION
I NSURAN.CE
FW
1275,MARKET STREET • SAN FRANCISCO, CALIFORNIA 94103
SCIF-FORM U•9.9 (NEW 10-77)
City of Petaluma
RE: Deferred Premium
Collection Plan
Page 3 of 3
SECTION FIVE
CHOICE OF LAWS
This Note shall be governed by and construed in
accordance with laws of the State of California in all
respects, including matters of construction, validity, and
performance.
SECTION SIX
ACKNOWLEDGMENT OF RECEIPT OF NOTE
Maker acknowledges receipt of a true copy of this Note
and certifies that all blank spaces hereinwere completed
and filled in before it was signed.
*Under.California law it is unlawful for an insurer to
promise the future payment of dividends under an unexpired
workers' compensation policy or to misrepresent the
conditions 'for div,ide,nd payment. Dividends are payable only
pursuant to conditions determined by the Board of Directors
or other Governing Board of the company following policy
expiration. It is a misdemeanor for any insurer or officer
or agent thereof, or any insurance broker or solicitor, to
promise the payment of future workers' compensation
dividends. . Past dividend performance is no guarantee of an
insurer's future dividend performance.
(signature of maker)
Title
5/84 V
I
COMPENSATION
I N S U R A N C E
1275 MARKET STREET : SAN FRANCISCO, CALIFORNIA 94103
SCIF'FORM U-99 (NEW 10-77) =
Public Agency
Deferred. Premium Collection Plan
Memorandum of Agreement
The State Compensation Insurance Fund does hereby agree with
City of Petaluma, the unde,rsign:ed policyholder, ,that:
In consideration of the receipt of a promissory note,
collateralized by a Resolution of the City of Petaluma
Governing Board guaranteeing payment in the amount of
One Hundred Eighty Eight Thousand Four Hundred Dollars
(S188,400) at One and one-half (1 1/2) percentage
points per annum 'below the Bank of America prime rate
of interest effective July 1, 1984, we will extend a
deferred premium collection plan for your workers'
compensation insurance, policy period July 1, 1984 to
July 1, 1985.
The plan includes the following elements:
- A minimum of forty percent (40%) of the annual workers'
compensation premium and forty percent (40%) of the
required deposit premium will be paidduring the policy
period. The paid portion of the deposit premium is due
and payable in cash at policy inception. The paid
portion of the premium is divided over the policy period.
If a payroll audit reveals that less than forty percent
(40%) of the premium was paid, the balance of that amount
will be billed and will be due and payable in cash at
that time.
- In the event that payroll audit reveals that more than
Sixty percent (60%) of the required premium was deferred,
the policyholder agrees to make up the balance by signing
an amendment to the Promissory Note. and Memorandum of
Agreement.
- At the option of the policyholder, State Fund will accept
a replacement Note from the policyholder for the premium
owed if such Note is executed thirty (30) days prior to
the maturity date of the Note it replaces. If the
polic.yhold'er opts to execute a replacement Note, such
Note shall be effective from the maturity date of the
Note it 'replaces, .mature no more than fourteen (14)
monthsfrom that date and be written pursuant to the same
terms as the Note it replaces.
- The interest earned during the -policy period is due and
payable in cash at the time of the final audit but in no
case more than one hundred fifty ('150) days after policy
expiration. The interest earned after the expiration
date of the policy is due and payable in cash twelve (12)
months after policy expiration but in .no case later than
sixty (60) days after the last day of the month in which
the promissory note matures.
COMPENSATION
INSURANCE
1275 N,ARKET STREET • SAN FRANCISCO, CALIFORNIA 94103
'SCCF FORM U-99 (-NEW 10-77) t-r=!
City of Petaluma
RE: Memorandum of Agreement
Page 2 of 3
- A replacement instrument of c.ollateralizatio.n must be
delivered to State Fund at least thirty (30) days prior
to the expiration of the existing instrument of
collateralization. If this condition is not met, State
Fund may demand payment in cash, of all principal and
interest earned.
- Interest is to beearned in an amount which shall he not
less than the sum of the interest computedin accordance
with the following:
The interest for' the policy period shall be the product
of the applicable rate of interest and the average
premium owed, where the average premium owed shall he
taken as the lesser of the following two amounts:
50% of the sum of the deposit premium not collected
in cash and the largest amount of premium owed
during the policy period, or
The sum of the premium owed at the beginning of each
monthly period the policy remained in .force divided
by the total number of such monthly periods; and
The interest for each period .following the expiration
of the policy during which the premium owed and the
rate of interest applicable remain unchanged shall be
the product of the applicable rate of interest, the
premium owed, and T; where T = the number of days
during which the premium ;owed and the rate of interest
applicable remained unchanged, divided by three hundred
and sixty-five (365).
- The obligation to collect .interest in cash is
unconditional and any representation to the contrary is
unlawful.
- Monthly payments are as indicated on the attached
schedule of payments and are due and payable 10 days
after receipt of bill.
- In the event of cancellation of this policy prior to
completing the policy period, this. agreement will be null
and void. All deferred premium, and any accrued
interest, will be due and payable in cash on the
effective date of cancellation.
COMPENSATION
INSURANCE
1275 MARKET STREET • SAN FRANCISCO, CALIFORNIA 94103
SCIF FORM U-99 (NEW 10-77)
City of. Petaluma
RE: Memorandum of Agreement
Page 3 of 3
General definitions of selected terms used in the plan,
promissory note and memorandum of agreement are found in
Special Rule V of the California Manual of Rules,
Classifications and Basic Rate's for Workers' Compensation
Insurance.
Signature of Policyholder State' Compensation
Insurance Fund
Title
Underwriting/Marketing Mgr.
Title
Date Date
Attachment: Monthly payment display.
5/8.4 /V
COMPENSATION
TAT E I NSURAN'CE
1275 MARKET STREET SAN FRANCISCO, CALIFORNIA 94103
SCIF FORM U,99 (NEW 10.77) ':_.-