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<br />The City ie exposed to various cisks of loss releted to torts; tbeft of, demage to, enl the des[ruction of assets; errors ercl omissions;
<br />injuries to employees; md mturei disssters. During fiscal years 1980 a� 1987, H�e City establis6ed a Workere' Compensation Fuffl
<br />md a Riek Maosgamaot Fuod raspactively (in[ernal service fuuda) to accouut for e� finence its uninsared riaks of loss. Uniar this
<br />program, tha Workere' Compansation Fu� provWes coverage up to a marzunum of 5280,000 for each claim. The City purchases
<br />ezcess lose coverege from tbe Workers' Compensetion Reinsurance Associetion, a nonprofit orgenizatioo astsblished by Minnesota
<br />State Sta[utes.
<br />The Risk Memgamant Fund provides comprehensive general liability azkl comprehensive automotive liability up to the statutory
<br />cuazimum of 5750,000. The City retains the risk of the first $SQ000 of each occurrence with an aonual rt�a.zimum exposure of
<br />�100,000. The City purcheses commercial iasurance for claims in ezcess of coverage providecl by the Risk Managemeat FwYI az¢i for
<br />all othar rieke of lose. Sattlad clauns have not exceedacl this coveruge in any of [he pas[ three fiscal years. There were no significnnt
<br />recluctions in [6e City's insurance coverage in 1998.
<br />While all fimde participete in the program, only enterprise fiuKls make direct payments to the Workers' Compenselion Fu� encl Risk
<br />Menagemen[ Fuod. An anmial taz is leviecl for all Mhar opereting funds. Ecterprise fucKl chargea encl the property tax lery are besed
<br />on a muiegamaot estimete of claims history eixl [he arnount necessary to maintain catastrophe reserves. The reserves as of December
<br />31, 1998, were 51,46R,271 encl $1,155,537 for the Workers' Compensetion Furcl aud Risk Memgement Funi respectively. The clauns
<br />lisbility of S39,233 a�l $4,000 respectively reportecl in both funcls at December 31, 1998, are bas«I on the requirements of
<br />Govamrt�ental AccouMing Sfandarcls Roa�d Stetement No. 10. 11vs statemeut requires tha[ a liability for claima be reported if
<br />infortnekion prior to the iseuence of the fitwucial statements indica[es i[ is probable that a liability has been incurted at [he cia[e of the
<br />fit�ancial statements m[1 the emount of the loss can be reasonably estimatecl. Changes in [he funcls' claims liability xmoun[ in fiscal
<br />i996, 1997 eud I993 were:
<br />1996
<br />1997
<br />1998
<br />Beginning of Fiscal
<br />Year Liabili[v
<br />30,457
<br />45,471
<br />42,391
<br />Beginning of Fiscril
<br />Year Liabilitv
<br />1996 4,000
<br />1997 4,000
<br />1998 4,000
<br />� rr.. � . �� i.
<br />Curcent Year Claims
<br />and Chanaes in Clams Pavm n c
<br />F,s[imat c
<br />91,924 76,970
<br />48,892 51,9'72
<br />83,691 86,849
<br />Risk Man�ment Fund
<br />Current Year Claims
<br />and Chan�rcin
<br />F.c imates
<br />86,990
<br />155,417
<br />49,542
<br />48
<br />!� ims �,ym ntc
<br />86,990
<br />($5,417
<br />49,542
<br />Balance at
<br />Fiscal Year End
<br />45,471
<br />42,391
<br />39,233
<br />Balance a[
<br />Ficca Year End
<br />4,000
<br />4,000
<br />4.000
<br />
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