(a) 
Definitions.
The following terms, as used in this division, have the following meanings, unless the context requires otherwise:
Act.
Includes omission or failure to act.
Administrative expenses.
The expenses of administering the program, to the extent designated as such by the city manager, including, but not limited to, the following:
(1) 
The compensation paid to the risk manager or to any risk management consultant;
(2) 
The compensation paid to any person or organization for the administration of the risk management program, including, but not limited to, claims adjuster, loss control services, management information services providers or any professional actuary;
(3) 
The expenses of defending any claim, including, but not limited to, the following:
(A) 
Compensation paid to expert witnesses;
(B) 
Attorneys’ fees and expenses and court costs; and
(C) 
Investigation expenses;
(4) 
Any expenses incurred by the city in the course of any financing undertaken to provide funding for the fund or to repay any obligation incurred by the city in the course of such a financing; or
(5) 
The cost of program insurance that is purchased in accordance with this division.
Advertising injury.
Any injury to a person that results from the promotional activities of the city if such injury arises out of libel, slander, defamation, violation of right to privacy, commercial piracy, unfair competition, or infringement of copyright, title or slogan, registered trademark, service mark or trade name.
Advertising injury claim.
A program general liability claim in which the damages are asserted to be the result of advertising injury.
Annual period.
The period of twelve (12) consecutive calendar months beginning on the effective date of the program and on each successive anniversary of the effective date of the program.
Assumed general liability claim.
Any plan claim for which the city, in the judgment of the risk manager, is liable.
Assumed risks.
The risks for which the city has assumed liability pursuant to the risk assumption ordinance (division 2 of this article).
Bodily injury.
Any physical harm or physical illness sustained by any individual, including a resulting death.
City attorney.
The city attorney of the city.
City council.
The governing body of the city.
City manager.
The duly appointed and designated city manager of the city.
Claim.
Any claim or suit against the city, or any claim or suit against any plan member that the city is responsible for defending under the risk assumption ordinance (division 2 of this article), regardless of whether any damages resulting from such claim or suit are permitted under this division to be paid from the fund.
Claims adjuster.
Any person designated as a claims adjuster as provided for by section 1.08.074(b) of this division.
Corporate general liability claim.
Any corporate general liability damages, together with the corporate general liability expenses that result from the claim giving rise to such corporate general liability damages, but does not include a workers’ compensation payment.
Corporate general liability conduct.
Any of the following:
(1) 
Any error or omission that causes an injury;
(2) 
Any conduct of the city or a plan member that:
(A) 
Causes bodily injury, property damage, or regulatory injury that is not intended or expected by the actor;
(B) 
Causes advertising injury that (i) is not intended or expected by the actor, and (ii) does not arise out of any statement that the actor knows is false; or
(C) 
Causes personal injury or property damage (regardless of whether intended or expected by the actor) that results from (i) the use of reasonable force for the purpose of protecting persons or property, or (ii) the discharge of the actor’s official duties for the city.
Corporate general liability damages.
The damages for which the city, in the judgment of the risk manager, is liable as a result of a claim arising from corporate general liability conduct.
Corporate general liability expenses.
The court costs, pre-judgment and post-judgment interest, attorneys’ fees, and any other expenses or costs for which the city, in the judgment of risk manager, is liable as a result of a claim giving rise to corporate general liability damages.
Corporate general liability risks.
The risks for which the city, as a municipal corporation, may be held liable by operation of law in the course of performing its governmental or proprietary functions.
Damages.
Compensatory damages, punitive damages, special damages or any other classification of damages that lawfully may be awarded against the city or a plan member as a result of a claim.
Error or omission.
Any act of a plan member that results in or constitutes an erroneous or improper discharge of such plan member’s official duties for the city (including the making of an incorrect statement), but that does not constitute legally actionable fraud or an intentional or knowing breach of duty.
Excluded payment.
Any of the following payments:
(1) 
The payment of a program claim that is not made while the program is in effect in accordance with applicable claims administration procedures;
(2) 
The payment of any program claim involving damages that arise from the exercise by the city of is power of eminent domain;
(3) 
The payment of all or that portion of any program claim, or of any other item for which a withdrawal from the fund is permitted by section 1.08.073(a) of this division, that, in lieu of payment from the fund, can be paid from:
(A) 
The proceeds of insurance carried by the city, including, but not limited to, casualty or liability insurance, workers’ compensation insurance or property insurance;
(B) 
The proceeds of any insurance carried under any health, accident or similar plan of benefits provided by the city; or
(C) 
Any fund, reserves or other source of payment available to the city that has been designated or otherwise set aside for such purpose;
(4) 
The payment of any program general liability claim arising from an injury that results from the distribution (whether by sale, gift or otherwise) of an alcoholic beverage, other than a distribution at an activity or function that is incidental to the city’s business, that:
(A) 
Is in violation of the law;
(B) 
Is to a minor or to an individual who is under the influence of alcohol; or
(C) 
Causes or contributes to the intoxication of an individual.
(5) 
The payment of any program claim arising from an injury that results from declared or undeclared war (including civil war, insurrection, rebellion or similar hostility) or any act or condition incident to war; or
(6) 
The payment of any program claim:
(A) 
In which the city’s liability exists by virtue of the Texas Tort Claims Act, chapter 101, Texas Civil Practice and Remedies Code, Vernon’s Texas Code Annotated, regardless of whether the city is a defendant, that exceeds the limits on liability applicable to the city under that statute;
(B) 
That the city is otherwise granted immunity from paying or precluded from paying by law; or
(C) 
In an amount that exceeds any limits prescribed by this division on the amounts of withdrawals that may be made from the fund to pay program claims.
Finance director.
The individual having the responsibility for the management of the city’s financial affairs.
Fund.
The risk management fund created by section 1.08.075 of this division.
Fund surplus.
The amount of money in the fund that is in excess of the amount that, in the opinion of a professional actuary, is required to maintain the fund on an actuarially sound basis, to the extent reasonably practicable, for the period of time and the risks of loss for which it is then funded.
Injury.
Any of the following injuries:
(1) 
Advertising injury;
(2) 
Personal injury;
(3) 
Property damage;
(4) 
Regulatory injury.
Law.
Includes the federal and state constitutions and statutes, the city ordinances, any administrative rules having the force and effect of law, and any controlling judicial decisions applicable to the city.
Occurrence.
An episode, an incident or series of related incidents, or an event or series of related events that result in compensable injury to one (1) or more persons.
Person.
Includes an individual; partnership, trust or other association; corporation; or governmental entity or agency.
Personal injury.
Any:
(1) 
Bodily injury;
(2) 
Mental harm, anguish, or illness (regardless of whether accompanied by bodily injury);
(3) 
Discrimination;
(4) 
Humiliation;
(5) 
Assault;
(6) 
False or improper service of process;
(7) 
False imprisonment;
(8) 
Damage to character, reputation or integrity;
(9) 
Invasion of privacy;
(10) 
Violation of property rights; or
(11) 
Violation of civil rights.
Personal injury claim.
Any program general liability claim in which the damages are asserted to be the result of personal injury.
Plan claim.
Any plan claim as defined in the risk assumption ordinance (division 2 of this article).
Plan loss expenses.
Any plan loss expenses as defined in the risk assumption ordinance (division 2 of this article).
Plan member.
Any plan member as defined in the risk assumption ordinance (division 2 of this article).
Program.
The city self-insurance and risk management program established by section 1.08.072(a) of this article.
Program claim.
Any program general liability claim.
Program general liability claim.
Any assumed general liability claim or any corporate general liability claim.
Program insurance.
Any insurance (other than the self-insurance provided by the fund) that is obtained by the city pursuant to section 1.08.075(c) of this division.
Program ordinance.
This division and any amendments hereto.
Program risks.
Any of the following risks:
(1) 
The assumed risks; and
(2) 
The corporate general liability risks.
Property damage.
Any damage to or destruction of tangible property or the loss of use of tangible property.
Property damage claim.
A program general liability claim in which the damages are asserted to be the result of property damage.
Regulatory injury.
Any economic loss sustained by a person as a result of any act by the city in the performance of its regulatory or property acquisition functions.
Risk assumption ordinance.
Ordinance No. 87/29 (which establishes the city risk management plan), as from time to time amended (division 2 of this article).
Risk manager.
The person serving as the risk manager pursuant to section 1.08.075(a) of this division.
Termination date.
January 1, 1998, or any other date of termination of the program specified by ordinance or resolution of the city.
(b) 
Interpretation.
Whenever the context requires:
(1) 
References in this division of the singular number shall include the plural and vice versa; and
(2) 
Words used in this division denoting gender shall be construed to include the masculine, feminine and neuter.
(c) 
Titles.
The table of contents and the titles given to any section of this division are for convenience only and are not intended to modify or affect the meaning of this division.
(1996 Code, sec. 8.1001; Ordinance adopting Code)
(a) 
Program established.
The city hereby establishes the city self-insurance and risk management program, which shall consist of the policies, rights and duties embodied in this division. The program shall be implemented and administered as provided by this division.
(b) 
Powers, duties and functions of risk manager.
(1) 
The risk manager may exercise the powers and shall perform the duties and functions prescribed by this division, the risk assumption ordinance and any other ordinance of the city.
(2) 
The risk manager may establish rules governing the conduct of its affairs.
(3) 
The risk manager may take such actions as are necessary to enable it to properly and effectively exercise the powers and perform the duties and functions delegated to it under this division or any other ordinance of the city.
(c) 
Administration of program.
The risk manager is responsible for the administration of the program in accordance with this division, subject to the superior authority of the city council. In the course of carrying out this responsibility, the risk manager shall interpret and apply the provisions of this division and the risk assumption ordinance.
(d) 
Risk management fund created.
(1) 
The risk management fund is hereby created.
(2) 
The fund is a special trust fund of the city, created for the purpose of providing capital for the program to be used as provided by this division.
(3) 
No person (including any plan member), other than the city, has or is granted or vested with any right to any of the money in the fund.
(4) 
The fund shall be maintained at the city’s depository bank unless required to be maintained elsewhere by another city ordinance or by agreement entered into by the city.
(e) 
Capitalizing the fund.
(1) 
The fund may be funded with money:
(A) 
Provided by contributions made from time to time, upon the order of the city commission, from budgeted, appropriated and currently available city money; or
(B) 
Derived from time to time by the city from any other lawfully available source of funding.
(2) 
The city council directs that $1,000,000.00 of the proceeds of the city’s certificates of obligation, Series 1987, together with $1,275,000.00 of the city’s reserves, be deposited in the fund on or prior to January 1, 1988.
(f) 
Risk retention policy.
It is the policy of the city, subject to budgetary and general economic conditions, to self-insure against program risks through the fund and to provide such self-insurance by depositing money into the fund in amounts sufficient, under actuarial determinations, to provide for the defined self-insurance coverages prescribed by this division. It is further the policy of the city, under the appropriate conditions, to obtain program insurance as provided by this division.
(g) 
No admission of liability for claims.
The city, by virtue of establishing and maintaining the program, is not admitting liability for any claim. The city reserves the right to assert any defense to the payment or collection of any claim that is available to it under any theory of law.
(1996 Code, sec. 8.1002; Ordinance adopting Code)
(a) 
Authorized withdrawals from fund.
(1) 
Money may be withdrawn from the fund only for the following purposes:
(A) 
To reimburse the city for administrative expenses;
(B) 
To pay any program claim;
(C) 
To pay any fund surplus to the city;
(D) 
To retire (by scheduled payment, prepayment, defeasance, or otherwise) any obligation of the city incurred in connection with providing funding for the fund; or
(E) 
To reimburse the city for any payment made under any agreement to provide funding for the fund that is permitted to be paid to the city pursuant to such agreement, or, to the extent and under the terms and conditions provided in such agreement, to cure a default in payment by the city under such agreement.
(2) 
No withdrawal from the fund may be made except in accordance with this division.
(3) 
Money may not be withdrawn from the fund to make any excluded payment.
(b) 
Control of withdrawals from fund.
(1) 
Subject to the regulations and limitations provided by this division, the determination of whether money in the fund is to be withdrawn is in the discretion of the city manager and finance director, upon recommendation from the city’s risk manager.
(2) 
An aggregate amount exceeding $1,000,000.00 may not be withdrawn from the fund to pay the program claims of any one claimant that arise from the same occurrence unless the city council approves a greater amount for the purpose.
(c) 
Method of withdrawal from fund.
Withdrawals from the fund may be made, upon the order of the risk manager, by check or electronic transfer drawn on the fund.
(d) 
Withdrawals of fund surplus.
Fund surplus may not be withdrawn from the fund more often than once a year.
(e) 
Limits on amount of withdrawals for program claims.
(1) 
The aggregate amount of withdrawals from the fund to pay all corporate general liability claims that arise from any one occurrence may not exceed the following amounts for the following respective classifications of corporate general liability claims:
(A) 
For personal injury claims: $1,000,000.00.
(B) 
For property damage claims: $1,000,000.00.
(C) 
For advertising injury claims: $1,000,000.00.
(D) 
For regulatory injury claims: $1,000,000.00.
(2) 
The aggregate amount of withdrawals from the fund to pay all assumed general liability claims that arise from any one occurrence may not exceed $1,000,000.00.
(3) 
The aggregate amount of withdrawals from the fund in any one annual period to pay program general liability claims may not exceed $3,000,000.00.
(f) 
Investment of fund.
The finance director shall direct the investment of money in the fund in investments that are eligible as lawful investments for other public funds of the city. By ordinance, the city council shall determine when and what portion, if any, of the realized investment income shall be withdrawn from the fund for deposit to the other accounts of the city.
(1996 Code, sec. 8.1003; Ordinance adopting Code)
(a) 
Generally.
The risk manager is responsible for the administration of claims.
(b) 
Claims adjusters.
(1) 
The risk manager may allow one (1) or more claims adjusters (each a “claims adjuster”) to adjust or otherwise administer claims for the city.
(2) 
Each person that is to serve as a claims adjuster shall be designated or authorized by the risk manager. A claims adjuster may be selected from among the city’s administrative staff, or a professional claims handling or management service may be retained as a claims adjuster.
(3) 
If a professional claims handling or management service is to be retained as a claims adjuster, such employment shall be on a nonexclusive basis, and the contract under which such service is retained shall be made terminable by the city upon the expiration of a reasonable term fixed by the risk manager.
(4) 
Each claims adjuster shall be directly responsible to the risk manager or his designee and shall follow any claims administration policies and procedures established by the risk manager.
(c) 
Defense of claims.
(1) 
The risk manager shall direct the defense of the city in claims.
(2) 
The risk manager, under supervision of the city attorney, may retain attorneys, experts and investigators in connection with the defense of any claim.
(d) 
Settlement of claims.
(1) 
The risk manager, in his discretion, may settle claims, subject to the limitations prescribed by this section.
(2) 
The claims of any one claimant that arise from the same occurrence may not be settled for an aggregate amount exceeding $25,000.00 without the approval of the city council.
(3) 
The risk manager may authorize claims adjusters to settle, with the approval of the city manager but without the advance approval of the city council, the claims of any one claimant that arise from the same occurrence for an aggregate amount not exceeding $25,000.00.
(e) 
Payment of non-covered claims.
Any claim that the city is legally obligated to pay that is not a program claim or, if a program claim, that is in excess of the amount permitted under this division to be withdrawn from the fund to pay such program claim, may be paid by the city only at such times and from such sources of payment as required by law.
(1996 Code, sec. 8.1004; Ordinance adopting Code)
(a) 
Risk manager.
(1) 
The program shall include the services of a risk manager (the “risk manager”).
(2) 
The risk manager may be an individual selected by the city manager from among the city’s administrative staff or an individual selected by the city manager who is hired as a city employee, or a professional risk management service may be retained as the risk manager. If a professional risk management service is to be retained as the risk manager, the selection of the service shall be made by the city manager.
(3) 
The risk manager shall perform the duties and functions prescribed by this division, subject to the superior authority of the city manager.
(b) 
Risk management activities generally.
(1) 
The risk manager shall coordinate the following activities:
(A) 
Identify and quantify (to the extent practicable) the risks that have the potential to result in loss to the city or plan members resulting from claims;
(B) 
Subject to approval of the city manager, devise and implement programs designed to reduce the city’s and the plan members’ exposure to loss due to program risks, including, but not limited to, risk assumption, risk reduction, risk retention and risk transfer, including purchase of program insurance;
(C) 
Develop and maintain for the city manager an information system, in coordination with any existing systems of the city, for the efficient recording of program information, including, but not necessarily limited to, information concerning claims, plan loss expenses and corporate damage expenses, administrative expenses, withdrawals from the fund, and program insurance premium;
(D) 
Perform such other services as may be specified by the city manager.
(2) 
Subject to applicable budgetary restrictions and with the consent of the city manager, the risk manager may coordinate the safety and other risk management policies and procedures that are to be followed by the city.
(c) 
Program insurance.
(1) 
Insurance (“program insurance”) may be obtained under the following circumstances:
(A) 
As excess coverage over that provided by the fund, at [as] reinsurance for the fund, or at [as] first-dollar coverage in lieu of that provided by the fund (which may result in converting coverage provided by the fund into excess coverage) if, in each case, the insurance is obtainable on a fiscally sound basis, giving consideration to the investment opportunities for the fund and any shock loss exposure of the city due to the program risks;
(B) 
When services that are necessary to effectively administer the program can be obtained only through the obtaining of the insurance;
(C) 
When the city is required by contract or law to obtain the insurance; or
(D) 
When the limitations on coverage under the fund do not result in long-term economic advantage to the city, and the insurance obtained either does not contain, or offsets or reduces, such limitations.
(2) 
The procurement of program insurance shall be coordinated by the risk manager and approved by the city council.
(3) 
Program insurance shall be obtained from sources determined to be in the best interests of the city. No particular insurance or financial quality rating is required, but the insurance provider must be in excellent financial condition as determined by the risk manager.
(4) 
When practicable, the remuneration of agents or brokers providing insurance services to the city pursuant to this division shall be on a fee basis.
(d) 
Cooperation by city employees.
To promote the efficient and effective administration of the program, the various department heads and other employees having administrative responsibilities for the city are encouraged and directed to cooperate with the risk manager.
(1996 Code, sec. 8.1005; Ordinance adopting Code)
(a) 
Report to city council on program status.
The risk manager or finance director, at least quarterly, shall report to the city council on the status and experience of the program, including the financial status of the fund.
(b) 
Alteration and termination of program.
(1) 
Subject to subsection (2) below, the city, by ordinance, may alter the program from time to time or terminate the program at any time without notice to any plan member or other person.
(2) 
The city, by agreement approved by the city council, may limit its right to alter or terminate the program.
(c) 
Effective date; program duration.
The program shall become effective at 12:01 a.m. on January 1, 1988, and shall continue in effect until 11:59 p.m. on the termination date.
(1996 Code, sec. 8.1006; Ordinance adopting Code)