Authority Members Gather to Learn “The Good, the Bad, and the Ugly of Risk Management” at 24th Annual Risk Management Educational Forum
More than 400 Authority members, business partners, and staff gathered at the Hyatt Regency in Indian Wells from October 9 – 11 to learn about The Good, the Bad, and the Ugly of Risk Management, the theme of the Authority’s 2019 Risk Management Educational Forum.
This year’s Forum provided participants the opportunity to interact with experienced speakers, hear relevant and timely presentations, and the venue to interact with members and business partners.
Wednesday’s opening sessions addressed exposures that represent the new normal for many public agencies: wildfires and cyber exposures. We Didn’t Start the Fire: Extinguishing Public Entity Liability After a Fire led the opening session and addressed potential claims arising from catastrophic wildfires and the defense strategies and risk management guidance public entities can use when faced with claims arising from wildfires. The recent California wildfires were the largest and most destructive in state history.
The second opening session Avoid an Ambush: Cyber & Ransomware Exposures – One Member’s Experience & Lessons Learned featured one member’s experience with a ransomware event and shared lessons learned for protecting government agencies and businesses. Cyber and ransomware attacks are hitting state and local municipalities, including school districts and local government agencies, and have reached epidemic proportions.
Participants gathered on Thursday morning for breakfast and a warm welcome by Chief Executive Officer Jon Shull. Shull shared, “The Authority plans each Forum so that members can study topics and issues relevant to local government. I am proud that the Authority hosts this educational experience each year where members can be together and learn together.”
Assistant Executive Officer Norm Lefmann then recognized the finalists for 2019 Capstone Award. The Capstone Award is presented annually to an individual at a member agency who best exemplifies the practice of risk management. The seventh annual Capstone Award was presented to Stephen Aryan, risk manager with the City of Palm Desert.
The Forum’s keynote speaker, Mac Anderson, founder of Simple Truths and Successories, Inc., inspired participants with his 212° philosophy on creating a service culture. Anderson shared personal anecdotes and explained “at 211 degrees, water is hot. At 212 degrees, it boils. And with boiling water, comes steam. And with steam, you can power a train. Just one extra degree makes all the difference.” Chris Yanonis, maintenance worker with the Authority recommended Mac Anderson as keynote speaker. Yanonis said, “I was given Mac’s book, Charging the Human Battery¸ a few years ago. The stories and words of wisdom are inspiring and simple reminders to maintain happiness in your life.”
Thursday’s breakout sessions addressed emerging risk management issues including The Role of Leadership In Addressing Employment Practices Liability, Social Media Use for Elected Officials, Effective Management of Bicycle & Scooter Rideshare Services, Best Approaches for Encounters with the Homeless, and Establishing a Comprehensive Sidewalk Inspection & Maintenance Program. A full listing of the breakout sessions and links to presentations are available in the Forum Agenda.
The Forum’s success is significantly owed to the overwhelming support of those partners that contributed financially toward the Forum’s program and activities. Shull recognized over 40 partners at the Sponsor Lunch on Thursday. Shull said, “The partnerships we have developed together allow us to continue to deliver an exceptional educational experience for our members. We deeply appreciate the role of our strategic partners in supporting this educational event.”
The Forum concluded Friday morning with a presentation by Gerry Preciado on True Grit: The Risk Manager’s Guide to Communicating with the Executive Suite. Preciado shared how to master the process of harnessing human interaction tools to effectively communicate with every level of an organization, including the executive suite.
Mark your calendars now to attend the 25th Annual California JPIA Risk Management Educational Forum to be held October 14 – 16, 2020 in Santa Barbara.
Photo caption: Chris Yanonis and Mac Anderson
Capstone Award Winner Announced at 2019 Risk Management Educational Forum
The 2019 Capstone Award was announced at this year’s Forum and presented to Stephen Aryan from the City of Palm Desert. The Capstone Award is presented annually to an individual at a member agency who best exemplifies the practice of risk management.
Stephen, the City of Palm Desert’s Risk Manager, was selected from four finalists and chosen for his exemplary risk management efforts. Some of Stephen’s accomplishments include utilizing the Authority’s ADA Assistance Program to complete the city’s ADA transition plan, coordinating loss prevention efforts with the city’s affordable housing complex, creating standardized contract language and waiver language, and establishing risk-related checklists for all departments within the city. In addition, he is recognized for creating greater risk management awareness throughout the city.
During the presentation, the following individuals were recognized as finalists for this year’s Capstone Award:
- Shannon Buckley, Finance Manager for the City of Lake Elsinore
- Todd Mitchell, Human Resources/Risk Manager for the City of Goleta
- Arabo Parseghian, Division Manager for the City of La Cañada Flintridge
Assistant Executive Officer Norm Lefmann reflected on the presentation, saying “This is an important recognition of four outstanding individuals that work tirelessly behind the scenes. The Authority relies on these and others like them to effectively carry out our mission in forging strong partnerships with members.”
The 2020 Capstone Award will be presented at the 25th Annual Risk Management Educational Forum to be held October 14 – 16, 2020 in Santa Barbara.
Photo caption: Capstone winner Stephen Aryan with Norm Lefmann
Remembering John Perry
By Ryan Thomas, Training and Loss Control Specialist
John Perry, NASA pioneer, published author, and teacher, passed away on September 2, 2019. Beginning in 1996, John joined with the California JPIA as an instructor at the Leadership and Management Academies with his good friend and fellow instructor, Forrest Story. John’s sessions included his trademarked “Job-Person-Environment Assessment,” a popular tool for participants to understand how to better utilize their energy at work, and how employees can better relate to their bosses, peers and subordinates.
John’s humble nature deflected attention, but he was a giant – both as a man and as an intellect. He worked as a NASA engineer with legendary astronauts and test pilots, including Neil Armstrong, Joseph Walker, and William Dana during the “race for space” against the Soviet Union during the 1960’s. He helped design the X-15, the titular aircraft in the development of the U.S. space program. John’s experience as an African American working at NASA during the heyday of the space era earned him mention in the book, “Hidden Figures” which was later adapted into the movie of the same name.
It was with Forrest Story that we knew John best, for they formed an inseparable tandem. According to Story, what made John Perry special was his interest in people and his willingness to learn from everyone he encountered. “John accepted you for who you are”, says Forrest. He believed that we weren’t put on earth to judge who the winners and losers are.
One of John’s favorite introductions to an exercise in the Authority’s Leadership Academy was “We think we know someone, but we really don’t until we know something about their journey. We need to allow others to tell us the stories about that journey that brought them to this place and time. Most importantly, as we listen to their stories, we need to throw a blanket over the prism of our own experience and listen to them as learners and not as judges. If we listen as learners, we will find gems of inestimable value in the stories we hear.”
John believed that no matter our circumstances, each of us is precious, capable of achieving remarkable things, and worthy of respect. He was inherently genuine and decent. As Forrest explains, “John walked his talk each and every day of his life.”
The Authority and its members will miss John.
Photo Caption: John Perry and Forrest Story
California JPIA to Present on “Lawsuit-Proofing Your City” at Upcoming MMASC Annual Conference
California JPIA Liability Program Manager Paul Zeglovitch and attorney Scott J. Grossberg will present “Lawsuit-Proofing Your City” on November 14, during the upcoming Municipal Management Association of Southern California (MMASC) Annual Conference in Santa Barbara.
Zeglovitch and Grossberg, of Scott J. Grossberg, APC, will lead a breakout session that will educate attendees about the primary risks California public agencies face, complexities of the litigation process, management issues, and the governing body’s role in the process. Topics during this presentation will include claims investigations sidewalk inspections, mandatory reporting, elected officials’ liability, votes of “no confidence,” tactics from unions and associations, additional insured issues, document retention policies, First Amendment audits, and participant waivers.
MMASC promotes public service excellence across a nine-county area in Southern California by providing a collaborative forum for its more than 800 members. Through MMASC, local government professionals participate in professional development, make meaningful connections, and exchange resources and best practices.
The Authority has supported the MMASC as a Platinum Sponsor since 2018.
“The California JPIA is proud to be an MMASC sponsor and help provide opportunities for local government professionals to learn from each other and better serve their communities,” said Chief Executive Officer Jon Shull. “Authority team members embrace MMASC events as an opportunity to learn alongside our government partners and hear directly from Authority members and prospective members about the issues that matter most to them.”
In addition to the annual conference, the Authority participates in MMASC’s signature events throughout the year to engage with local leaders regarding risk management and learn about government officials’ priorities.
“The California JPIA is a valued MMASC partner. Through their sponsorship and their involvement in MMASC events, it’s clear that the California JPIA is dedicated to educating and serving the needs of Southern California’s government professionals,” said Nick Gonzalez, MMASC President.
For more information about MMASC, visit www.mmasc.org.
California Tort Claim Analysis and Reform
By Norm Lefmann, Assistant Executive Officer
The California Association of Joint Powers Authorities (CAJPA) is a state-wide association for risk-sharing pools and the state’s leading voice for JPAs. As part of its advocacy for pools like the California JPIA, CAJPA is heading an effort to understand rising California public sector tort claim costs.
At the same time, all appearances point to a hardening excess and reinsurance market. These carriers play a vital role in working with pools by allowing them to lay off risk in a fiscally prudent manner, resulting in lower coverage costs for pool members.
Given the acceleration of large judgments and deep pocket settlements, carriers that work with pools are increasing retentions or carving out certain coverage lines while delivering sharp premium increases.
As such, CAJPA is initiating a tort liability project that would develop the data needed to validate these increases, quantify the impact, and identify the losses that are at the root of the problem. This project will be a multi-year effort that also seeks to determine potential strategies that would lead to legislative reform.
Briefly, the project will begin by collecting ground up data from risk-sharing pools and other public entities, including larger self-insured cities. An actuarial analysis will then be performed to project ultimate costs for the past 10 years. It is estimated that approximately 100,000 claims will be included in this phase of the project.
From this data, closed files with a total paid value of $500,000 or greater will be identified and subjected to in an in‐depth analysis. Early estimates are that 3,000 claims will be included. A methodology will be created to help agencies that provided data capture critical additional information. This analysis will serve as the statewide baseline of tort liability claims.
Aon Public Sector Pooling has been hired to serve as the technical lead for this project. This will allow access to government affairs professionals and subject matter experts, and will also utilize actuarial professionals that are recognized industry leaders.
The California JPIA will continue to keep members apprised of this project and its progress. Please direct any questions to Norm Lefmann, Assistant Executive Officer.
Americans with Disabilities Act Financing Program
By Abraham Han, Administrative Analyst
The California JPIA is currently accepting applications for the second year of the Americans with Disabilities Act (ADA) Financing Program. This program provides members with an opportunity to obtain funding that might otherwise be difficult to procure for ADA transition plan development or the removal of ADA-related barriers.
The program is in the second year of a five-year period, with an annual call for applications.
Members selected to receive funds through the ADA Financing Program must repay the amount, plus interest, with level annual payments of principal and interest over a five-year term. Additional details regarding the requirements and terms of the program are outlined in the ADA Financing Program application.
The application can be found here, and it is in a fillable PDF format. It is highly recommended to download a copy of the application so that partial progress in completing an application can be saved.
Applications will be accepted until January 15, 2020. After this date, members will need to reapply during the next application cycle. All members will be notified of their application status by March 4, 2020.
This program is part of a larger coordinated effort to help members make progress towards compliance with the Americans with Disabilities Act.
If you have any questions about the ADA Financing Program or the Authority’s other ADA-related programs and resources, please contact Abraham Han, Administrative Analyst.
Governor Signs Assembly Bill 5 Into Law, Codifying the Dynamex ABC Test for Independent Contractors
By Megan Lieber and David Nauss, Collins, Collins, Muir and Stewart
California Governor Newsom recently signed Assembly Bill 5 (AB 5), which codifies the test used to determine if a worker is an employee or an independent contractor and added several exceptions and clarifications.
In April 2018, the California Supreme Court created a new three-part test to establish whether a worker is an employee or independent contractor with its decision in Dynamex Operations West, Inc. v. Superior Court of Los Angeles. Previously, courts weighed a range of factors to determine independent contractor classifications. In Dynamex, the Supreme Court introduced a three-element ABC test.
AB 5 now expands that test and applies it to all provisions of California’s Labor Code and Unemployment Insurance Code. Under the test, California presumes any person providing labor is an employee of the hiring entity, unless the following three criteria are met:
- The person is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract and in fact;
- The person performs work outside the usual course of the hiring entity’s business; and
- The person is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.
If the person does not meet all three prongs of this ABC test, then they must be classified as an employee.
AB 5 includes several exceptions. Licensed professionals are exempt from AB 5, including lawyers, architects, accountants, and engineers. The law also creates exceptions for certain industries such as construction subcontractors and for business-to-business service providers.
Both exceptions require the independent contractor to have a written contract, proper licensing, a business independent of the hiring entity, and to operate from a separate business location than the hiring entity.
The business service provider exception also requires that the independent contractor provide services directly to the hiring business, not the hiring business’ clients; maintain a clientele separate from the business; advertise to the public as available to provide similar services to other businesses; be free from the control and direction of the hiring business; set its own rates; provides its own tools; and not perform work for which a license from the Contractors State License Board is required.
The construction subcontractor exception also requires the independent contractor have the authority to hire and fire employees and be financially responsible for errors or omissions in labor or services.
While AB 5 attempts to simplify the classification question by applying the more straightforward ABC test to the entire Labor Code, it still requires employers to the assess the elements to determine if someone they hire is a bona fide independent contractor and the many exceptions create opportunities for good-faith mistakes. AB 5 also confirms the employer still bears the burden of demonstrating that a worker is properly classified as an independent contractor.
We expect employees and employers to litigate the meaning of the new law. With civil penalties of $10,000 to $25,000 for each misclassified worker, a cautious and conservative approach in applying AB 5 is encouraged until the courts provide clarification of the proper way to apply the law and its exceptions.
Governor Signs Legislation Aimed at Law Enforcement
By Scott Grossberg, Attorney at Law
AB 392 was signed into law by Gov. Gavin Newsom on August 19, 2019 and is a further attempt by lawmakers, advocates, affected families, and the law enforcement community to come together as a cohesive whole to minimize the police use of deadly force. Governor Newsom, accompanied by family members characterized as those who had lost loved ones to police violence, recently said, “As California goes, so goes the rest of the United States of America. And we are doing something today that stretches the boundaries of possibility and sends a message to people all across this country — that they can do more.” Dubbed both the “California Act to Save Lives” and the “Stephon Clark’s Law,” Governor Newsom signed AB 392 with the intent to modernize California’s peace officer use of force policies.
AB 392 does not take effect until January 1, 2020. It will likely result in further and more aggressive litigation against public agencies and their employees considering the amendment to California Penal Code Section 835a (peace officer use of force) that will take place.
SB 230 also addresses peace officer use of deadly force and talks specifically about use of force policies. SB 230 begins with the following language: “The highest priority of California law enforcement is safeguarding the life, dignity, and liberty of all persons, without prejudice to anyone.” It further sets forth the definitions of “deadly force” and “feasible” while outlining, among other items, the de-escalation, proportional level of force, and deadly force guidelines that law enforcement agencies are expected to implement. SB 230 expressly states: “Each law enforcement agency shall, by no later than January 1, 2021, maintain a policy that provides a minimum standard on the use of force.” The bill goes on to outline 20 different categories that need to be addressed in an agency’s use of force policy.
In discussing “necessary” force, SB 230 comports with the Graham v. Connor objective reasonableness standard in stating: “. . . necessary, as determined by an objectively reasonable officer under the circumstances based upon the totality of information actually known to the officer.”
The California Chiefs of Police issued, in part, the following statement upon the bill’s passage:
“SB 230 provides the tools and training needed to effectively minimize the use of force and deliver better outcomes in alignment with the AB 392 standard. AB 392’s success hinges on the passage and implementation of SB 230, which remains in the Assembly Appropriations Committee before proceeding to vote on the Assembly floor.”
In other words, SB 230 (developed in part by PORAC) “provides officers with the tools and training they need, including de-escalation tactics, interacting with vulnerable populations and alternatives to use of deadly force.” It works together with AB 392 to provide further use of force clarity and risk management options for the law enforcement community.
California Penal Code Section 835a (police authority to use force) currently provides:
“Any peace officer who has reasonable cause to believe that the person to be arrested has committed a public offense may use reasonable force to effect the arrest, to prevent escape or to overcome resistance.
“A peace officer who makes or attempts to make an arrest need not retreat or desist from his efforts by reason of the resistance or threatened resistance of the person being arrested; nor shall such officer be deemed an aggressor or lose his right to self-defense by the use of reasonable force to effect the arrest or to prevent escape or to overcome resistance.”
That section will be revised to instead expressly provide:
“(a) The Legislature finds and declares all of the following:
(1) That the authority to use physical force, conferred on peace officers by this section, is a serious responsibility that shall be exercised judiciously and with respect for human rights and dignity and for the sanctity of every human life. The Legislature further finds and declares that every person has a right to be free from excessive use of force by officers acting under color of law.
(2) As set forth below, it is the intent of the Legislature that peace officers use deadly force only when necessary in defense of human life. In determining whether deadly force is necessary, officers shall evaluate each situation considering the circumstances of each case and shall use other available resources and techniques if reasonably safe and feasible to an objectively reasonable officer.
(3) That the decision by a peace officer to use force shall be evaluated carefully and thoroughly, in a manner that reflects the gravity of that authority and the serious consequences of the use of force by peace officers, in order to ensure that officers use force consistent with law and agency policies.
(4) That the decision by a peace officer to use force shall be evaluated from the perspective of a reasonable officer in the same situation, based on the totality of the circumstances known to or perceived by the officer at the time, rather than with the benefit of hindsight, and that the totality of the circumstances shall account for occasions when officers may be forced to make quick judgments about using force.”
The amended language also addresses those with physical, mental health, developmental, and intellectual disabilities and states that these individuals “are significantly more likely to experience greater levels of physical force during police interactions.”
The new statutory rectification is something those who have been defending police use of force cases (particularly in federal venues) have had to address for some time; namely, the 1989 Graham v. Connor and 2015 Kingsley v. Hendrickson cases and their objective reasonableness discussions. The new state statutory language, in fact, will read:
“Any peace officer who has reasonable cause to believe that the person to be arrested has committed a public offense may use objectively reasonable force to effect the arrest, to prevent escape, or to overcome resistance.”
With the amended statute, peace officers will still be justified and should be exonerated in using deadly force when:
- The officer reasonably believes, based on the totality of the circumstances, that such force is necessary to defend against an imminent threat of death or serious bodily injury to the officer or to another person, or
- To apprehend a fleeing person for any felony that threatened or resulted in death or serious bodily injury, if the officer reasonably believes that the person will cause death or serious bodily injury to another unless immediately apprehended.
The foregoing two options should also serve as the basis for an officer’s explanation of the use of deadly force, the type of content that will need to appear in a written report, and as the foundation for further proactive use-of-force and practical skills training. It is suggested that a best practices approach to this new California stance is to provide ongoing practical skills training that includes the presentation of various use of force scenarios (including shoot-don’t shoot examples) coupled with post-scenario practice for the officer to specifically and articulately explain the type of force that was used and the reasons why they were deployed.
While AB 392 does not take effect until 2020 and SB 230 (if enacted) does not take effect until 2021, it is recommended that law enforcement agencies immediately undertake the following steps in order to reduce legal liability associated with its officers’ use of physical force:
- How the use of force is consistent with the Department’s “sanctity of every human life” position;
- How the use of force was necessary for the defense of human life;
- How the use of force reconciles with the Department’s use of force policies;
- What the involved officer knew or perceived at the time of the decision to use and actual use of force;
- How the use of force considered or dismissed physical, mental health, developmental, or intellectual disabilities of the subject;
- How the use of force is objectively reasonable;
- How the use of deadly force comports with the “reasonable belief” or “apprehend a fleeing person” provisions of the amended statute; and
- How the officer responded to the situation and the de-escalation attempts that were made.
In closing, it is likely that the language of and advocacy surrounding AB 392 will open the door for further claims and litigation arising from a police use of force situation. It is expected that the concept of “reasonableness” will be attacked, and an attempt will be made to use term “unnecessary” in its place. This expected and expanded attack on law enforcement can be easily answered by local agencies if they continue to keep their training proactive, current, and transparent as they work to ensure that involved officers know how to describe the totality of the circumstances that caused them to act when, where, and as they did.
It is expected that members that utilize the Lexipol policy manual will be provided policy-making guidance in the coming months.
By Jeff Rush, Workers’ Compensation Program Manager, and Abraham Han, Administrative Analyst
The first year of the 2019-2020 California State Legislature has ended. October 13 was the last day for the Governor to sign or veto bills passed by the Legislature on or before September 13.
The Authority provides the following legislative update which highlights key bills with the most anticipated impact to members.
AB 218 (Gonzalez). Damages: childhood sexual assault: statute of limitations.
Status: Chaptered, signed by the Governor
Summary: This bill expands the definition of childhood sexual abuse, which would instead be referred to as childhood sexual assault. This bill increases the time limit for commencing an action for recovery of damages suffered as a result of childhood sexual assault to 22 years (compared to eight years) from the date the plaintiff turns 18 or within 5 years of the date the plaintiff discovers or reasonably should have discovered that the psychological injury or illness occurring after the age of majority was caused by sexual assault, whichever is later. Further, the re-opening of previously settled cases for three years is concerning.
AB 749 (Stone). Settlement agreements: restraints in trade.
Status: Chaptered, signed by the Governor
Summary: This bill prohibits an agreement to settle an employment dispute from containing a provision that prohibits, prevents, or otherwise restricts a settling party that is an aggrieved person, as defined, from working for the employer against which the aggrieved person has filed a claim or any parents company, subsidiary, division, affiliate, or contractor of the employer. The bill provides that a provision in an agreement entered into, on, or after January 1, 2020, that violates this prohibition is void as a matter of law and against public policy. This bill precludes an employer from prohibiting an employee that has engaged in unlawful or egregious conduct, from seeking future employment with the same employer.
AB 1116 (Grayson). Firefighters: peer support.
Status: Chaptered, signed by the Governor
Summary: This bill authorizes public agencies to create a “peer support team” consisting of emergency service personnel, hospital staff, clergy, and educators to aid fire service employees with emotional or professional issues. Any communication between a fire service employee and members of the “peer support team” shall remain confidential unless information shared necessitates legal disclosure.
SB 542 (Stern). Workers’ compensation.
Status: Chaptered, signed by the Governor
Summary: This bill creates a rebuttable presumption for peace officers and firefighters who are diagnosed with post-traumatic stress disorder. This bill pertains to injuries sustained on or after January 1, 2020 and requires six months of employment unless the employee is exposed to a “sudden and extraordinary event”. Additionally, employees may file a claim up to five years after leaving employment depending on their length of service.
The Authority will continue to monitor various bills as the legislative session continues in January 2020.
If you have any questions, please contact Abraham Han, Administrative Analyst.