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HomeMy WebLinkAboutD-1 Staff Report - Azusa - City Manager Claims Authority $50kSCHEDULED ITEM D-1 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL VIA: SERGIO GONZALEZ, CITY MANAGER FROM: TALIKA M. JOHNSON, DIRECTOR OF ADMINISTRATIVE SERVICES DATE: APRIL 15, 2024 SUBJECT: INTRODUCTION FIRST READING OF ORDINANCE AMENDING SECTION 3-3 OF CHAPTER 3 OF THE AZUSA MUNICIPAL CODE TO INCREASE THE SETTLEMENT AUTHORITY OF THE CITY MANAGER FROM $25,000 TO $50,000 FOR RESOLVING CLAIMS AGAINST THE CITY BACKGROUND: In 2013, a $25,000 settlement authority was given to the City Manager to resolve claims against the City, allowing the City Manager to resolve minor claims in an expeditious manner if it benefits the City. Staff is seeking City Council authority to raise the City Manager’s claims settlement authority to $50,000, the same amount as the purchasing authority currently given to the City Manager. Some cost savings can be derived by the City through the accelerated settlement of certain claims. The recommended change to the City Manager’s authority provides that opportunity for the City and aids the claims process to be quicker and administratively more efficient. Proposed Ordinance The City Council currently delegates to the City Manager authority to allow, compromise, or settle claims for an amount of up to twenty-five thousand dollars ($25,000.00). The City Council has the sole authority to allow, compromise, or settle claims for an amount in excess of $25,000. The proposed ordinance will increase the settlement authority of the City Manager for an amount up to fifty thousand dollars ($50,000.00) and clarify that the City Council has sole authority to allow, compromise, or settle claims for an amount in excess of $50,000. RECOMMENDATION: Staff recommends the City Council take the following action: 1)Waive further reading, read by title only, and introduce Ordinance No. 2024-02. Approved City Council April 15, 2024 Increase City Manager Claims Settlement Authority April 15, 2024 Page 2 ANALYSIS: In 2022, the City Council increased the City Manager’s purchasing authority to $50,000. However, the City Manager’s settlement authority for general liability and worker’s compensation claims is $25,000 and has been so since 2013. The cost of settling claims has increased due to the rising costs of attorney's fees, medical charges, and repair/remediation expenses. California Government Code - § 935.4 allows a charter provision, or a local public entity by ordinance or resolution, to authorize an employee of the local public entity to perform those functions of the governing body of the public entity under this part that are prescribed by the local public entity, but only a charter provision may authorize that employee to allow, compromise, or settle a claim against the local public entity if the amount to be paid pursuant to the allowance, compromise or settlement exceeds $50,000. Azusa is a general law city, and therefore, the City Council may delegate claims management, including settlement of said claims, to the City Manager up to the statuary limit of $50,000. Although vetted by attorneys and approved by the City’s Insurer, claims above the amount authorized by the City Council are taken into closed session. This process increases the City's costs as the attorney representing the City of Azusa is present at a closed session. Any costs associated with the presentation are charged to the City, including meeting and preparation time. In addition, there is staff time and preparation associated with adding and managing agenda items. In order to increase efficiencies, Staff recommends the City Council amend Section 3-3 of Chapter 3 of the Azusa Municipal Code – Authority of the city manager, to increase the settlement authority of the City Manager from $25,000 to $50,000 for resolving claims against the City. FISCAL IMPACT: There is no fiscal impact associated with the recommended action. Payment of claims is included in the annual budget as appropriate. Prepared by: Reviewed and Approved: Merci Rodriguez Talika M. Johnson Payroll Supervisor Director of Administrative Services Reviewed and Approved: Sergio Gonzalez City Manager Attachments: 1) Ordinance No. 2024-02 2) Current AMC Chapter3 – Claims Against the City RESOLUTION NO. 2024-02 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF AZUSA, AMENDING SECTIONS 3-3 OF CHAPTER 3 OF THE AZUSA MUNICIPAL CODE TO INCREASE THE SETTLEMENT AUTHORITY OF THE CITY MANAGER FROM $25,000 TO $50,000 FOR RESOLVING CLAIMS AGAINST THE CITY. WHEREAS, it is sometimes in the best interest of the City of Azusa (“City”), to settle claims against the City in an expeditious manner; and WHEREAS, California Code, Government Code - GOV § 935.4 reads: A charter provision, or a local public entity by ordinance or resolution, may authorize an employee of the local public entity to perform those functions of the governing body of the public entity under this part that are prescribed by the local public entity, but only a charter provision may authorize that employee to allow, compromise, or settle a claim against the local public entity if the amount to be paid pursuant to the allowance, compromise or settlement exceeds fifty thousand dollars ($50,000). A charter provision, ordinance, or resolution may provide that, upon the written order of that employee, the auditor or other fiscal officer of the local public entity shall cause a warrant to be issued upon the treasury of the local public entity in the amount for which a claim has been allowed, compromised, or settled; and WHEREAS, the current settlement authority of the City Manager ($25,000), should be raised to $50,000 to make it possible to settle such claims and to be consistent with the City Managers current contract authority. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF AZUSA DOES ORDAIN AS FOLLOWS: SECTION 1. Section 3-3 of Chapter 3 of the City of Azusa Municipal Code is amended to read as follows: Sec. 3-3. - Authority of city manager. The city council delegates authority to the city manager and their designee to review all claims for sufficiency and to reject any and all claims. The city council delegates to the city manager, and/or their designee, authority to allow, compromise, or settle claims for an amount up to $50,000.00. The city council shall have sole authority to allow, compromise, or settle claims for an amount in excess of $50,000.00. SECTION 2. CEQA. The City Council finds that this Ordinance is not subject to the California Environmental Quality Act (“CEQA”) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly, or indirectly. Attachment 1 SECTION 3. EFFECTIVE DATE. This Ordinance shall become effective thirty (30) days after its adoption. SECTION 4. SEVERABILITY. If any section, sentence, clause or phrase of this Ordinance or the application thereof to any entity, person or circumstance is held for any reason to be invalid or unconstitutional, such invalidity or unconstitutionality shall not affect other provisions or applications of this Ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this Ordinance are severable. The City Council of the City of Azusa hereby declares that it would have adopted this ordinance and each section, sentence, clause or phrase thereof, irrespective of the fact that any one or more section, subsections, sentences, clauses or phrases be declared invalid or unconstitutional. SECTION 5. PUBLICATION. The City Clerk shall certify the adoption of this Ordinance and shall cause the same to be posted as required by law. PASSED, APPROVED, AND ADOPTED this ____ day of _________________ 2024. ______________________________ Robert Gonzales Mayor ATTEST: ___________________________ Jeffrey Lawrence Cornejo, Jr. City Clerk APPROVED AS TO FORM: ___________________________ Marco A. Martinez City Attorney -MUNICIPAL CODE Chapter 3 CLAIMS AGAINST THE CITY Azusa, California, Code of Ordinances Created: 2024-03-08 14:52:01 [EST] (Supp. No. 69) Page 1 of 3 Chapter 3 CLAIMS AGAINST THE CITY Sec. 3-1. Applicability of chapter. The provisions of this chapter are enacted pursuant to California Government Code Section 935 and shall apply to all claims against the city for money or damages, provided that such claims are not governed by any other statutes or regulations. Claims against the city or any of the city's elected officials, officers, employees or agents which are exempted by California Government Code section 905 from the tort claims procedures contained in Chapter 1 and Chapter 2 or Part 3 of Division 3.6 of Title 1 of the California Government Code and which are not governed by any other state statute, regulation or provision of this Code shall be governed by this chapter. (Ord. No. 01-06, § 1, 9-17-01; Ord. No. 05-09, § 1, 12-19-05) Sec. 3-2. Presentation of claims—Prerequisite for bringing suit. In accordance with California Code Section 935, subdivision (b), no suit subject to this chapter may be brought against the city until a claim has been presented to and acted upon by the city. Any action brought against the city on a claim after it has been presented to and acted upon by the city shall be subject to the provisions of Government Code Sections 945.6 and 946. (Ord. No. 01-06, § 1, 9-17-01) Sec. 3-3. Authority of city manager. The city council delegates authority to the city manager and his or her designee to review all claims for sufficiency and to reject any and all claims. The city council delegates to the city manager authority to allow, compromise, or settle claims for an amount up to $25,000.00. The city council shall have sole authority to allow, compromise, or settle claims for an amount in excess of $25,000.00. (Ord. No. 01-06, § 1, 9-17-01; Ord. No. 13-O5, § 1, 1-6-14) Sec. 3-4. Contents of claim—Review for sufficiency. A claim shall be made in writing and shall be presented to the city clerk by the claimant or by a person acting on the claimant's behalf. A person acting on the claimant's behalf may include, but not be limited to, his or her guardian, conservator, executor or administrator. A claim shall show all information as required by Government Code Section 910. A claim must be signed by the claimant or by a person acting on the claimant's behalf, as described above. No claim may be filed on behalf of a class of persons unless signed or verified by every member of that class as required by this section. The city manager, or his or her designee, may, within twenty (20) days of receipt of a claim, either personally deliver or mail to claimant a notice stating deficiencies on the claim presented. If such notice is delivered or sent to claimant, the city shall not act upon the claim until at least fifteen (15) days after such notice is sent. (Ord. No. 01-06, § 1, 9-17-01) Attachment 2 Created: 2024-03-08 14:52:01 [EST] (Supp. No. 69) Page 2 of 3 Sec. 3-5. Time limitation for presentation of claims. Any claim specified in section 3-1 of this chapter shall be presented within the following time limitations: (1) Claims relating to a cause of action for death, injury to person or to personal property, or growing crops shall be presented within six (6) months after the accrual of the cause of action. (2) Claims relating to any other cause of action shall be presented within one (1) year after the accrual of the cause of action. (Ord. No. 01-06, § 1, 9-17-01) Sec. 3-6. Time for action by city. The city council or city manager or his or her designee shall act on a claim within 45 days after the claim has been presented. By mutual agreement of the claimant and the city council or city manager or his or her designee, such 45-day period may be extended by written agreement. If the claim is not acted on within 45 days, it shall be deemed to have been rejected on the 45th day unless such time period has been extended, in which case it shall be denied on the last day of the period specified in the extension agreement. (Ord. No. 01-06, § 1, 9-17-01) Sec. 3-7. Application to file a late claim. Any applicant who fails to file a claim within the time period required by section 3-5 of this chapter may submit a written application to the city for leave to present a late claim, pursuant to the provisions of Government Code Section 911.4. The city manager or his or her designee, shall grant or deny the application to present a late claim within 45 days after it is presented to the city, in accordance with the provisions of the Government Code Sections 911.6 through 912.2, inclusive. (Ord. No. 01-06, § 1, 9-17-01) Sec. 3-8. Time barred claim. Nothing in this chapter revives or reinstates any cause of action that, on the effective date of this chapter, is barred by failure to comply with any previously applicable statute, ordinance, or regulation requiring the presentation of a claim prior to a suit subject to this chapter, or by failure to commence any action thereon within the period prescribed by any applicable statute of limitations. (Ord. No. 01-06, § 1, 9-17-01) Sec. 3-9. Suit. Any suit for money or damages brought against the city upon a written claim, as prescribed by this chapter, shall conform to the requirements of sections 940—949 of the California Government Code. Any action brought against any employee of the city shall conform to the requirements of sections 950—951 of the California Government Code. (Ord. No. 01-06, § 1, 9-17-01) Created: 2024-03-08 14:52:01 [EST] (Supp. No. 69) Page 3 of 3 Sec. 3-10. Effective date of chapter. Subject to section 3-8, the provisions of this chapter shall apply retroactively to any causes of action occurring prior to the effective date of this chapter; provided, however, that a claimant who has a cause of action occurring more than ten months before the effective date of this chapter shall file a claim within sixty days after this chapter's effective date in accordance with its provisions or such claim shall be barred. (Ord. No. 01-06, § 1, 9-17-01)