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Renew Citywide Insurance Program and Policies Procured through Independent Cities <br />Risk Management Authority and Arthur J. Gallagher <br />August 5, 2025 <br />Page 4 <br />5 <br />2 <br />4 <br />7 <br />estimates indicate that liabilities exceed available fund balances. However, the City’s <br />target reserve levels—set at 80% of actuarially determined liabilities, as determined <br />biennially—are $35.8 million for Workers’ Compensation and $14.9 million for General <br />Liability. To address this target reserve shortfall, staff has gradually increased overhead <br />charges during the annual budget process, with the goal of restoring fund balances to <br />target levels over time. <br />Workers’ Compensation General Liability <br />Actuarial valuation as of June 30, 2026 <br />(Present Value) <br />$44,757,982 $18,646,692 <br />Target Reserve (80% of liability)$35,806,386 $14,917,354 <br />Estimated ending fund balance as of June <br />30, 2026 <br />$19,801,925 $13,170,324 <br />Estimated Target Reserve Shortfall $(16,004,461)$(1,747,030) <br />After appropriation adjustment, the following table summarizes the funds budgeted and <br />available for estimated premium and administrative costs. <br />Fiscal <br />Year <br />Accounting Unit <br />– Account <br />Accounting Unit <br />Description Account Description Amount <br />2025-26 08209054-64010 Workers <br />Compensation <br />Workers Compensation, <br />Insurance Payment <br />$ 1,300,000 <br />2025-26 08009051-64010 <br />Liability & <br />Property <br />Insurance <br />Liability & Property <br />Insurance, Insurance <br />Payment <br />$ 10,876,290 <br />APPROPRIATION ADJUSTMENT <br />2025-26 08009051-64010 Liability & <br />Property <br />Insurance <br />Liability & Property <br />Insurance, Insurance <br />Payment <br />$ 1,345,359 <br />Total:$ 13,521,649 <br />EXHIBIT(S) <br />1. Agreement with Arthur J. Gallagher Insurance Brokers of California, Inc. For <br />Insurance Broker Services, Client Service Agreement <br />2. ICRMA Member Contribution Invoice - Santa Ana <br />Submitted By: Lori Schnaider, Executive Director of Human Resources <br />Approved By: Alvaro Nuñez, City Manager <br />  <br />  <br />City Council 15 – 4 8/5/2025