TMWRF purchases commercial property coverage to protect against losses relating to its property and contents (including boiler and machinery exposures).  Additionally, a Pollution Liability policy is carried at the facility and renewed on a 3-year cycle which is due in the coming fiscal year.  The City of Reno will reimburse the City of Sparks for their share of insurance policy costs under the master agreement governing the operation of TMWRF.  General liability coverage (to cover premises exposures and acts of its employees) is managed under the City’s master General Liability policies and programs as all staff at TMWRF are City of Sparks employees.  A spreadsheet detailing the various supplemental insurance policies is attached to this Staff Report.

The city continues to work to control losses and limit exposure through the Risk Committee and working with departments to identify potential exposures. 

The premium for property coverage of $381,366 in Fiscal 2021 reflects an increase of approximately 24% ($72,635) from the current fiscal year.  The increase can be tied to current conditions in the insurance market that have absorbed significant property losses over the past few years (due to natural disasters) as well as increased replacement values of properties at TMWRF.

The premium for Pollution Liability coverage of $56,310 reflects an increase of approximately 6% ($3,095) from the previous renewal that occurred in Fiscal 2018.  This change fits within expected inflationary factors over the past 3 years.

The total estimated premium depicted on the attached spreadsheet may be adjusted upward or downward, depending on variations in actual exposures throughout the course of the policy year as property values continue to be examined and a routine "true-up" of those values may occur.

COVERAGE CHANGES

There are no coverage level changes proposed for this policy period.

1. Council may approve the item as recommended.
2. Council may reject the recommendation of staff.

I move to approve the purchase of various commercial insurance policies to protect the financial interests of the Truckee Meadows Water Reclamation Facility, in an amount of approximately $437,676.00, for the next policy periods and authorize the Contracts and Risk Manager to execute agreements for those policies.