ORDER NO. 3 0615
INTERLOCAL AGREEMENT WITH TAC RISK MANAGEMENT POOL
Came to be heard this the 13th day of November, 2007, with a motion made by
Commissioner Letz, seconded by Commissioner Williams. The Court
unanimously approved by vote of 4-0-0 to:
Approve Interlocal Agreement with TAC Risk Management Pool, as presented.
~b ~/ ~
1,3~
COMMISSIONERS' COURT AGENDA REQUEST
PLEASE FURNISH ONE ORIGINAL AND TEN (10) COPIES OF THIS
REQUEST AND DOCUMENTS TO BE REVIEWED BY THE COURT
MADE BY: Paula J. Hargis
MEETING DATE: November 13, 2007
OFFICE: County Auditor
TIME PREFERRED: None
SUBJECT: Interlocal Agreement with TAC Risk Management Pool
EXECUTIVE SESSION REQUESTED: (PLEASE STATE REASON)
NAME OF PERSON ADDRESSING THE COURT: Paula J. Hargis
ESTIMATED LENGTH OF PRESENTATION: 5 minutes
IF PERSONNEL MATTER -NAME OF EMPLOYEE:
Time for submitting this request for Court to assure that the matter is posted in
accordance with Title 5, Chapter 551 and 552, Government Code, is as follows:
Meeting scheduled for Mondays:
THIS REQUEST RECEIVED BY:
THIS REQUEST RECEIVED ON:
5:00 PM previous Tuesday
@ .M.
All Agenda Requests will be screened by the County Judge's Office to determine if adequate
information has been prepared for the Court's formal consideration and action at time of Court
Meetings. Your cooperation will be appreciated and contribute towards your request being
addressed at the earliest opportunity. See Agenda Request Rules Adopted by Commissioners'
Court.

Frequently Asked Questions
Texas Association of Counties Pool Consolidation
Q: I heard that the pools at TAC are merging, is that true?
A: Yes, three existing pools have consolidated to create a single streamlined Pool that
will issue all types of Property and Casualty Coverage available to TAC members. The
TAC Workers' Compensation Fund, the TAC Risk Management Pool, and the TAC
Property Casualty Fund have joined together via interlocal agreement and will now be
known as the new TAC Risk Management Pool. The new TAC Risk Management Pool
will handle Workers' Compensation, Property, General Liability, Public Official
Liability, Law Enforcement Liability, Auto Liability, Auto Physical Damage and Crime
coverage. (The TAC Health and Employee Benefits Pool and the TAC Unemployment
Fund are NOT included in this merger.)
Q: Why did you merge the Pools?
A: The pools merged to create a more streamlined operation and allow for better pricing
and service to the members. A consolidated Pool will allow TAC to offer package
discounts to members who purchase several types of coverage.
Q: My County/Entity is a member of one of these Pools, will my coverage be
changing?
A: No, your coverage will not change; it will transfer over to the new Pool. However in
some cases -your anniversary date maybe adjusted. Members who are affected by
anniversary date changes will be notified of these changes well in advance. As your
policies renew, you will notice that they are issued from the new TAC Risk Management
Pool
Q: What will my County/Entity need to do?
A: Each existing Pool member will need to sign an Interlocal Agreement with the new
TAC Risk Management Pool.
Q: When will the new Pool assume the coverage?
A: The new Pool will assume the coverage liability on January 1; 2008. All existing
members must have their new Interlocal Agreements completed by December 31, 2007 in
order to avoid a lapse in coverage.
Q: Will we get new policies?
A: Your existing policies/coverage documents will be assumed by the new Pool. As
each one comes up for renewal, you will get a new policy from the TAC Risk
Management Pool.
Q: Do I have to fill out new applications/forms/paperwork?
A: At this time, you only need to complete the Interlocal Agreement. When your
coverage comes up for renewal, you will submit the normal paperwork as you have
always done in the past .
TEXAS ASSOCIATION
1210 San Antonio • Austin, TX 78701 ~
Karen Ann Norris, Executive Director
September 14, 2007
Honorable Pat Tinley
Kerr County Judge
700 Main Street
Kerrville, TX 78028-5323
Dear Judge Tinley,
Of COUNTIES
~ P.O. Box 2131 • Austin, TX 78768-2131
In August 2007, the TAC Workers' Compensation Self Insurance Fund, the TAC County
Government Risk Management Pool and the TAC Property & Casualty Self Insurance Fund
voted to merge their operations into a newly created Pool, the Texas Association of Counties
Risk Management Pool (TAC RMP). TAC RMP was formed on August 16, 2007. All
existing assets, liabilities and business operations of the three merging pools will be
transferred to TAC RMP effective January 1, 2008.
The decision to form the TAC RMP and merge the existing pools followed several months of
extensive study ordered by the boards of the existing pools. A work group of senior elected
county officials was chartered to look at all possible issues and determine if consolidation
would benefit the funds' collective membership. After completing the study, work group
members unanimously concluded that the membership would benefit from consolidating
operations into a unified pool, fording that a combined pool would be more stable financially
and better able to provide the best coverage, service and price, both now and in the future.
Serving as the interim board of directors of TAC RMP is the Honorable Bill Freeman, Cooke
County Judge; the Honorable Evan Gonzales, Lee County Judge; and the Honorable Tab
Thompson, Erath County Judge. Beginning January 1, 2008 the combined board membership
of the TAC Workers' Compensation Fund, the TAC Risk Management Pool and the TAC
Property & Casualty Fund will constitute the Board of Directors of the newly formed TAC
RMP.

Your county or other governmental entity currently obtains Workers' Compensation, Property,
Crime, Automobile Liability, General Liability, Public Officials Liability, Law Enforcement
Liability, and Auto Physical Damage from one of the pools that have merged. To ensure
uninterrupted coverage from TAC RMP it will be necessary for the governing body of your
organization to approve a new interlocal agreement with TAC RMP. This agreement is based
upon and almost identical to the interlocal agreements your county has signed in the past. I
have enclosed two copies of the new TAC RMP Interlocal Participation Agreement for your
action. I have also included, for your information, a copy of the Bylaws for TAC RMP.
512-4'78-875.3 800-456-5974 • 512-478-1426 FAX • www.counry.org
Page 2, September 14, 2007
Following approval by your commissioners' court or other governing body, please have the
person with the proper authority execute the Interlocal Participation Agreement. It is
important that you also list on the signature page of the Agreement the name and telephone
number of the person the governing body of your organization designates as pool coordinator.
This must be the person that is designated or authorized to receive, or give, legal notice for the
entity. Please complete and sign both copies of the agreement, and return one to my attention
in the enclosed envelope. We would appreciate you returning the executed document as soon
as possible -but we must have it back no later than December 1, 2007 to permit
continuation of your pool coverages.
Please feel free to contact me, either by email (jimj @coun .ors), or by calling 1-800-456-
5974 with any questions you may have concerning the new pool or the enclosed Bylaws and
Interlocal Agreement. I have also enclosed a list of "Frequently Asked Questions" that, may
answer the more routine questions concerning this merger.
Sincerely,
.,
James W. Jean, ARM
Director, Program Administration
Enclosure (1) TACRMP Interlocal Agreements
(2) TACRMP Bylaws
(3) Frequently Asked Questions

#30615
- - TEXAS ASSOCIATION OF COUNTIES
RISK MANAGEMENT POOL
INTERLOCAL PARTICIPATION AGREEMENT
This Agreement, entered into by and between the Texas Association of Counties
Risk Management Pool (hereinafter called "Pool") and Kerr County (hereinafter called
"Member") shall be effective as of the last date on which a party to the Agreement signs
the Agreement.
RECITALS:
WHEREAS, the Pool is sponsored by the Texas Association of Counties
(hereinafter called "TAC"), and the Pool was formed by the entry into a charter interlocal
agreement by the Texas Association of Counties Workers Compensation Self-Insurance
Fund, the Texas Association of Counties Property & Casualty Self-Insurance Fund and
the Texas Association of Counties County Government Risk Management Pool;
WHEREAS, the Pool was created as an interlocal entity organized under Chapter
791, GOVERNMENT CODE,- V.T.C.A, to provide self-insurance for all risks, including
workers' compensation, property and casualty and liability coverages as authorized by
cxAPTER 2259, GOVERNMENT CODE, V.T.C.A, Chapter 504, LABOR coDE, V.T.C.A.,
Chapter 119, LOCAL GOVERNMENT CODE, V.T.C.A. and other law;
WHEREAS, Member, a local government as defined in Chapter 791 GOVERNMENT
coDE and a governmental unit as defined in Chapter 2259 GOVERNMENT coDE, desires to
take advantage of the benefits made available through the Pool;
WHEREAS, the Member's governing body has approved this agreement; and
WHEREAS, the parties recognize that the Pool is a Risk Management Pool
authorized by statute and the coverage provided is not considered and does not constitute
insurance under any Texas law, including the Texas Insurance Code nor under the
~..~~. .~ ~ 4«...~..~.. ~~. 4~.. .. m.+~.. .. r~.~~....4..... ~.~L rliisiir~nce;
Coiiuii0ii law anu is nog icyuiated vy uic ic~a~ Lc~cui.uicut of
NOW, THEREFORE, it is Agreed and Understood among the parties as follows:
SECTION 1. PARTICIPATION
1.01. Agreement to Participate
Member hereby contracts to become a Member of the Pool. THIS IS NOT A
CONTRACT OF INSURANCE and Member does not and cannot hereby elect to
create any contract of insurance. The Pool is not a trust and Member does not
intend to create a trust.
Approved by RMP Board August 29, 2007
~' - - 1.02. Benefits and Obligations Described in Coverage Documents
Member shall have benefits and obligations as more particularly described in the
coverage document(s) which may be provided to Member under the terms and
conditions of any particular Pool coverage purchased by Member pursuant to this
Agreement. A coverage acceptance form, received by the Pool after completion of
the underwriting process, or an application for renewal of existing coverage,
followed by issuance of a Declarations Page by the Pool for the coverage, shall
evidence the acceptance of the terms and conditions of the coverage purchased.
Member's rights under any coverage document are subject to the terms and
conditions contained in the coverage document.
1.03. Term of Agreement
The term of this Agreement shall commence on the 1st day of January, 2008, and
shall continue in full force and effect for a period of one (1) year. This Agreement
shall be automatically renewed annually for an additional one (1) year term without
the necessity of any action by the parties other than the acceptance of any
amendments to the coverage contract and rates. Either party may elect not to renew
this Agreement by giving written notice at least thirty (30) days prior to the end of
the original term or any renewal term. In the event some coverage is added during
the term of this Agreement, the Agreement shall be automatically extended to
coincide with the coverage document period provided for the new coverage, except
that the term of the Agreement shall continue in accordance with the term(s) of
coverages) in effect, should any such new coverage be subsequently terminated.
1.04. Termination Without Cause During the Term of the Agreement
A. Termination of This Agreement
This Agreement may be terminated by either party by giving sixty (60) days prior
written notice of intent to terminate the Agreement to the other party. Any notice
of uitEnt tv teiiiiliiatc iiiiist b2 delivered by deposit lii file U. S. i~aii, cetiified,
return receipt requested. Termination of this Agreement by either party terminates
membership in the Pool and any coverages obtained pursuant to this Agreement.
B. Termination of a Coverage Provided Under This Agreement
Subject to Section 1.06, any coverage provided under this Agreement may be
canceled by either party by giving sixty (60} days written notice of intent to cancel
the coverage to the other party, unless the terms of the applicable coverage
document conflict with this provision, in which case the provision in the coverage
document controls.
~~
2
Approved by RMP Board August 29, 2007
- 1.05. Addition or Change of Coverages
Pool coverages may be added to the Member's existing coverages) provided
pursuant to this Agreement, or the provisions of any coverage may be changed, by
agreement in writing of the parties.
1.06. Failure to Maintain Coverage
The failure to maintain at least one coverage through the Pool will result in .the
automatic and immediate termination of this Agreement.
1.07. Coverage Documents
Any coverage documents used by the Pool shall be approved by the Board of
Directors _of the Texas Association of Counties Risk Management Pool ("the
Board"), or by the Pool Administrator, subject to review by the Board.
SECTION 2. POWER, DUTIES AND ORGANIZATION
2.01. Powers of Pool
The Pool shall have any power necessary to carry out .the purpose of this
Agreement which may be conferred by Chapter 791, V.T.C.A., GOVERNMENT
CODE, by Chapter 2259, GOVERNMENT CODE, V.T.C.A ; by Chapter 504, LABOR
CODE, V.T.C.A , by Chapter 119, V.T.C.A., and by any other law empowering the
Pool, and by this Agreement and the Bylaws of the Texas Association of Counties
Risk Management Pool ("the Bylaws"). The Pool shall have the power to execute
interlocal participation agreements following the form of this Agreement with
other Members. The Pool shall have the power to employ a Pool Administrator and
independent contractors to assist in carrying out this Agreement.
2.02. iviember Compuance
By execution of this Agreement, Member agrees to comply with and abide by the
Bylaws, applicable Coverage Documents, and the rules and regulations of the Pool,
as now in effect and as hereafter amended.
2.03. Incorporation of B~aws and Bylaws' Amendments
The Bylaws are incorporated by reference and made a part of this Agreement for all
purposes as if fully set out herein. Any amendment to the Bylaws adopted by the
Board shall become binding on Member immediately upon its adoption unless it is
in direct conflict with the rights of Member under this Agreement. Any
amendment to the Bylaws which alters the rights of a Member under this
Agreement shall be effective on the sixtieth (60~') day after written notice of the
3
Approved by RMP Board August 29, 2007
provision has been served on Member, or otherwise as the parties may agree. If
Member objects to any change in the Bylaws affecting such rights, Member may
appeal the matter to the Board within ten (10) days of receipt of the notice. The
proposed change will not apply to the objecting member until resolution of the
matter by the Board.
_ 2.04 Execution of New Agreement
The Pool may require Member to execute a new Interlocal Participation Agreement
at any time in order for Member to continue participation: Should Member fail to
execute and return such an Agreement, the Pool may terminate the Member's
participation in the Pool in accordance with the Bylaws.
2.05 Pool Administrator
The Texas Association of Counties (hereinafter referred to as "TAC") or its
designee, is the administrator of the Pool.
2.06 Provision of Reinsurance
The Pool may provide for reinsurance at a level to be determined by Board in its
sole discretion.
2.07 No Joint and Several Liability
The Member has no joint or several liability other than the maximum annual
contribution payable by the Member. The participation of the Member shall at all
times be on a nonassessable basis beyond the annual amount of contribution.
2.08 No Guaranty Fund
RMP is aself-insurance pool that does not participate in a guaranty fund, so
funning for ivfember's claims under trio coverage docurner~ts w~iii come solely
from the Pool's resources. If the Pool's resources are insufficient to satisfy a
claim, the Member will be responsible for the claim. The Pool shall endeavor to
maintain at all times stop loss insurance and reserves sufficient to assure that all
incurred, fully-developed losses and expenses for the total Pool can be paid from
available Pool resources.
2.09 Dividends Investments and Use of Surplus
Any surplus shall be invested or distributed in accordance with the Bylaws.
4
Approved by RMP Board August 29, 2007
2.10 Pool Arrangement for Annual Audit
The Pool shall be annually audited by a certified public accounting firm retained
by the Pool.
SECTION 3. POOL COORDINATOR
3.01. Appointment
Member shall by written instrument appoint a Pool Coordinator. The name of the
Pool Coordinator and the address for which notices may be given by the Pool shall
be set forth in the space provided at the end of this Agreement. The Pool
Coordinator shall promptly provide the Pool with any required information.
3.02. Change of Pool Coordinator
Member may change its Pool Coordinator and/or the address for notice by giving
written notice to Pool of such change prior to the effective date of the change.
3.03. Responsibility of Pool Coordinator
Any failure or omission of the Member's Pool Coordinator shall be deemed a
failure or omission of Member. The Pool is not required to contact
any other individual with respect to Member's business except the named Pool
Coordinator unless notice or contact to another individual is required by applicable
statute. Any notice given by Pool or its contractor to the Pool Coordinator or such
individual as is designated by statute for a particular notice, shall be deemed notice
to Member.
SECTION 4. ANNUAL CONTRIBUTION
4.01 Submission of Information
Member shall timely submit to the Pool documentation necessary for the Pool to
use to determine the risk to be covered for the next renewal period and to properly
underwrite the risk exposure. The Pool will provide forms identifying the
information requested.
A Member obtaining Workers' Compensation coverage through the Pool must
submit an annual estimated payroll, by payroll classifications of the Member, to
the Pool no later than sixty (60) days prior to the first day of the coverage period.
At the end of the coverage period, Member must provide the Pool with the actual
payroll for the coverage period.
Approved by RMP Boazd August 29, 2007
4.02 Failure to Timely Submit Information
If Member fails to timely submit the information required in section 4.01-prior to
the renewal date, the Pool may charge a penalty of $100 for each month or portion
thereof that the information is not received. Failure to submit the required
information within 30 days of the renewal date or failure to pay any penalty
provided for in this section may result in termination of Membership under this
Agreement or or cancelation of the applicable coverage.
4.03 Determination of Member' Annual Contribution
(a) The contribution for coverage provided by the Pool to Member shall be
determined annually. Tn the event that charges are adjusted during a coverage
year, the adjustment will become effective on the annual renewal date for that
coverage.
(b) The contribution for the Member shall be based upon the information provided
pursuant to section 4.01 of this Agreement, as well as information obtained from
any audit or inspection of operations and property of the Member by the Pool.
For liability and property coverages, Members will be charged an annual flat rate
contribution that is not subject to audit and adjustment.
For workers'compensation coverage, Member will be charged an annual
estimated contribution based on the estimated payroll provided pursuant to
Section 4.01, but the contribution is subject to year-end audit and adjustment. If
the Member's actual annual payroll differs from the estimated payroll, the amount
of the annual contribution may be adjusted. If, after this adjustment, the actual
contribution is more than the estimated contribution paid by the Member, the Pool
shall notify Member of the difference and Member shall immediately remit the
additional amount to the Pool. if the actual contribution is less than the estimated
contribution paid by the Member, the Pool shall refund the excess amount to the
Member.
(c) The Pool shall calculate the annual contribution for Member using the
appropriate discount and/or surcharge if applicable, as approved by the Board.
(d) The Pool will- adopt a rate plan for each line of coverage. For workers'
compensation coverage, the Pool shall calculate and furnish each Member its
individual experience modifier, when earned, in accordance with the provisions of
the applicable experience rating plan as approved by the Board.
6
Approved by RMP Board August 29, 2007
4.04 Pa~nent of Contribution Is a Condition of Coverage
Member agrees to pay to the Pool the annual contribution amount determined for
Member based upon the Pool's calculation. The parties agree that the annual
contribution will be paid from current revenues available to Member. The
existence of any coverage provided pursuant to this Agreement is expressly
conditioned upon, in addition to any other requirements under this Agreement, full
and timely payment of charges for any such coverage by Member. .Payment shall
be paid from Member's current revenues.
4.06 Billing and Payment of Annual Contribution
The contribution for coverage provided by the Pool to Member shall be
determined annually. In the event that charges are adjusted during a coverage
year, the adjustment will become effective on the annual renewal date of the
coverage document.
The Pool shall bill the annual contribution in advance. Member shall pay the Pool
at the address specified in Paragraph 7.07. For liability and property coverages,
the annual contribution must be paid in advance in its entirety. For workers'
compensation coverage, the annual contribution must be paid in four quarterly
payments. For workers' compensation coverage, the Pool will submit quarterly
invoices in advance and the Member must pay in advance of the quarter. For all
coverages, Member's payment is due upon receipt of invoice and, unless the Pool
exercises its right to terminate for non payment as provided in Section 4.07, any
payment not received within thirty (30) days of the date of billing shall accrue
interest at the rate of 1°Io per month, or as allowed pursuant to Texas law.
4.07 Termination for Failure to Pay
Notwithstanding any other provision in this Agreement, if any payment or
contribution for coverage owed by Member to the Pool is not paid as required by
this Agreement, the Pool may cancel such coverage or terminate this Agreement,
as the Pool deems appropriate, in accordance with the Bylaws and the applicable
coverage document. Member shall remain obligated for such unpaid contribution
or charge for the period preceding termination.
4.08 Pool's Right to Audit
The Pool has the right, but no obligation, to audit and inspect Member's
operations and property at any time upon reasonable notice and during regular
business hours, as the Pool deems necessary to protect the interest of the Pool.
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Approved by RMP Board August 29, 2007
- ~ 4.09 Charges or Rates in Recognition of High Loss Experience
With respect to any Pool coverage, in the event any Member has a higher loss
experience than identified in the underwriting standards relevant to that coverage,
the Pool may impose on that Member a different or additional rate structure or
charge for coverage than those otherwise generally provided to other Members, as
a condition of that Member's participation in the relevant coverage.
4.10 Short Rate for Early Withdrawal
Should the Member withdraw before the end of the annual contract period, Member
will be subject to the short rate earned contribution factors.
4.11 Collection of Outstanding Contributions
Should the Member fail to make the required payment hereunder, this Agreement
may be canceled by its terms and suit may be brought to collect any outstanding
contributions due and payable to the Pool. Alternatively, at the option of the
Pool, claims costs normally paid by the Pool, up to the total amount of
contribution due, must be paid by Member. If this provision is invoked,
notwithstanding any provision to the contrary, the Pool has no liability to pay
claims expenses until the Member has paid in claims expenses an amount equal to
the amount of the contribution due. It is understood and agreed among the
parties that, to the extent allowed by law, venue for any suit brought for the
purpose of collecting any contributions due and payable to the Pool shall be in
Travis County, Texas, and that this contract was made and all actions under this
Agreement are performable in, Austin, Travis County, Texas. The party
prevailing in any action brought for the purpose of collecting any outstanding
contributions due and payable to the Pool shall be entitled to reasonable attorney's
fees, plus court costs. For purposes of this provision, the Pool shall be the
prevailing party if it is awarded any relief sought in such preceding.
SECT 1O'i~l j. CLr~l~is
5.01 Claims Submitted
Member shall submit claims to the Pool as set forth in each applicable Coverage
Document. or as otherwise required by the Pool or state law.
5.02 Member to Cooperate
If the Pool needs assistance from Member or Member's employees regarding a
claim, Member will cooperate with the Pool and will provide such assistance.
s
Approved by RMP Board August 29, 2007
SECTION 6. SAFETY
6.01 Safety Prog am
The Member agrees to cooperate in instituting any and all reasonable safety
regulations that may be recommended for the purpose of eliminating or
minimizing hazards that may contribute to losses. In the event that the Member
determines any recommendation submitted by the Pool, or a contractor authorized
by the Pool to make such recommendations on behalf of the Pool is
unreasonable, the Member has a right to appeal to the Board.
SECTION 7. MISCELLANEOUS
7.01 Amendment
Except as provided in this Agreement and the Bylaws, this Agreement shall not be
amended or modified other than in a written agreement signed by both parties.
7.02 Applicable Law
This Agreement is entered into and executed in the State of Texas, and all
questions pertaining to its validity or construction shall be determined in
accordance with laws of the State of Texas. This agreement is made and
performable in Travis County, Texas.
7.03 Suit Against the Pool. The Pool retains its governmental immunity except to the
extent it is waived by the Legislature. The parties agree that the following
adjudication procedures apply to any legal dispute, and that Member's right to sue
the Pool is contingent upon compliance with these procedures: 1) prior to filing
suit, Member must comply with all of its obligations under this Agreement and
any applicable coverage document; 2) prior to filing suit, Member will participate
in good faith in mediation in Travis County, Texas; and 3) any suit against .the
Pool must be brought in Travis County, Texas.
7.04 Acts of Forbearance
No act of forbearance on the part of either party to enforce any of the provisions
of this Agreement shall be construed as a modification of this Agreement nor
shall the failure of any parry to exercise any right or privilege herein granted be
considered as a waiver of such right or privilege.
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Approved by RMP Board August 29, 2007
7.05 Effect of Partial Invalidity
In case any provision of this Agreement is held illegal or invalid for any reason,
said illegality or invalidity shall not affect the remaining provisions of this
Agreement.
7.06 Headings and Captions
The headings and captions in this Agreement are inserted for the purpose of
convenience only and shall not be considered in the construction of any provision.
7.07 Notices and Pam eats
Any notice required to be given to the Pool shall be deemed properly sent if
addressed to:
Texas Association of Counties
Risk Management Pool
P. O. Box 2131
Austin, Texas 78768
and deposited in the United States Mail with proper postage. Payments must be
sent to either the above address or to the address specified in the Pool's invoice.
The Pool may change its address by giving notice to Member. Any notice
required to be given or payment required to be made to Member shall be deemed
properly sent if addressed to the Member's Pool Coordinator at the address set
forth below. -Such person and address may be changed by Member if written
notice of such change is given to Pool.
7.08 Counterparts
This Agreement may be executed in counterparts, each of which, when taken
separately, shall be deemed an original.
7.09 Right to Enforce
No person or entity not a party to this Agreement may bring suit, as a third-party
beneficiary or otherwise, to enforce this Agreement.
7.10 Prior Agreements Superseded
This Agreement constitutes the sole agreement of the parties hereto and
supersedes any prior agreements respecting the services to be provided under this
Agreement.
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Approved by RMP Board August 29, 2007
EXECUTION
IN WITNESS WHEREOF, we hereunto affix our signatures as of the date
indicated below.
TEXAS ASSOCIATION OF COUNTIES Kerr County
RISK MANAGEMENT POOL MEMBER
By:_~~", ~ ~Cdk~
Karen Ann Norris, Executive Director
Texas Association of Counties
B~C'~~
Cs,~J.u~g~ or overning Body's Designee
Date: September 14 2007
Approved by RMP Board August 29, 2007
Date: November 13 , 2007
MEMBER' S POOL COORDINATOR
Name:_
Address:
11
' ~ - BYLAWS AND PLAN OF OPERATION OF THE
TEXAS ASSOCIATION OF COUNTIES
RISK MANAGEMENT POOL
ARTICLE I
Creation of RMP
The Texas Association of Counties Risk Management Pool (hereinafter referred to as
"RMP"), sponsored by the Texas Association of Counties ("TAC"), was established on August
16, 2007 by the entry of the following governmental units of the State of Texas into a charter
interlocal agreement: the Texas Association of Counties Workers' Compensation Self-Insurance
Fund; the Texas Association of Counties County Government Risk Management Pool; and the
Texas Association of Counties Property and Casualty Self Insurance Fund. These governmental
units of the State of Texas created RMP to provide protection to participating governmental units
for all types of property and casualty risks of the governmental units, their officials, employees
and volunteers, and other qualified officials, including but not limited to, district court judges,
district attorneys, volunteer firefighters and volunteer fire departments, and officers of special
purpose districts, pursuant to the provisions of Chapter 791, Government Code (the "Interlocal
Cooperation Act"), Chapter 2259, Texas Government Code, Chapter 504, Texas Labor Code,
Chapter 157, Texas Local Government Code, Chapter 154, Texas Local. Government Code,
Chapter 119, Texas Local Government Code, and other applicable law. The Charter Interlocal
Agreement creating RMP and the Agreement and Plan of Merger entered into by TAC, the
Texas Association of Counties Workers' Compensation Self-Insurance Fund, the Texas
Association of Counties County Government Risk Management Pool, and the Texas Association
of Counties Property and Casualty Self Insurance Fund are attached hereto as Exhibits "A" and
"B", respectively, and incorporated herein by reference.
ARTICLE II
Definitions
As used in this agreement, the following terms shall have the meaning hereinafter set out:
A. Board -the Board of Directors of RMP;
B. Member - a governmental unit of the State of Texas which enters into and maintains the
requisite contractual relationship through an interlocal agreement with RMP;
C. Charter Members -the Texas Association of Counties Workers' Compensation Self-
Insurance -Fund; the Texas Association of Counties County Government Risk
Management Pool; and the Texas Association of Counties Property and Casualty Self
Insurance Fund;
D. RMP Manager, RMP Administrator, Fund Manager -TAC or its duly authorized
designee.
1
Approved August 16, 2007
ARTICLE III
Purposes
A. RMP is organized as a combination of local governments, as that term is defined in Texas
Government Code Section 2259.001, exclusively for the benefit of governmental units of
the State of Texas, to serve as the administrative agency and a pool for providing
coverage for all types of property and casualty risks for which governmental units may
lawfully self-insure. RMP is intended to assist Members in controlling costs by taking
advantage of economies and efficiencies of scale. RMP is not intended to operate as an
insurance company, but rather is intended to be a contracting mechanism by which
governmental units of the State of Texas may contract with each other to provide
collective self-insurance. As such, RMP is not in the business of insurance and is not
subject to regulation by the Texas Department of Insurance. RMP is authorized to
operate anywhere within the State of Texas and is not limited in its operations to any
particular territory within the State of Texas.
B. It is the intent of the Members to use all income to pay for all expenses of RMP. It is
also the intent of the Members to have RMP provide coverages at reasonable cost.
Except as specifically provided herein, all income and assets of RMP shall be at all times
dedicated to the exclusive benefit of its Members.
C. The principal, income and all property received and accepted by the Board to be
administered under these Bylaws may be held or invested for RMP in such a manner as
the Board shall determine. The investment policy of RMP shall be established by
resolution of the Board, and may be changed from time to time. The Board may make
payments from income or principal, or both, to or for the use or benefit of the Members,
in such a manner as the Board shall determine to be proper under these Bylaws and the
investment policy.
D. No part of the net earnings of RMP shall inure to the benefit of or be distributable to its
Directors, Officers, Members, or other private persons, except that RMP may pay
reaso7n~able comp~tensation for g7oods and services rendered and may make payments and
dl~trlb ut1o11J m fu''th er al„1Ve of file ~'~Cses set 1V~l.l~l her V11L.
E. Upon dissolution of RMP, the Board of Directors shall, after paying or making provision
for the payment of all the liabilities of RMP, distribute all the assets of RMP either to the
current Members; who are organizations the income of which is excluded under section
115(1) of the Internal Revenue Code and who contributed to any remaining surplus pro
rata in proportion to their annualized contributions, or to a successor entity the income of
which is excluded under section 115(1) of the Internal Revenue Code.
F. In recognition of the role of RMP as one of the governmental programs of TAC, RMP
shall seek cooperative arrangements with other TAC-sponsored governmental programs
concerning administration, investments, joint programs, and other matters of mutual
concern in order to achieve economies and to effectuate objectives shared by the said
Association and any other TAC-sponsored governmental programs. Such cooperative
arrangements may include formal merger with another one or more of the governmental
2
Approved August 16, 2007
programs of TAC, at such time and on such terms as shall be judged appropriate by the
Directors of RMP and the Directors of TAC.
ARTICLE IV
Non-Waiver of Governmental or Other
Immunity or Monetary Limits
All money and other assets, plus earned interest, contained within RMP are derived from
the Members. It is the intent of the Members that, by entering into interlocal participation
agreements to become Members of RMP, they do not waive and are not waiving any immunity
provided to the Members or their officers or employees by any law or any monetary limits on the
liability of the Members or their officers or employees provided by any law.
ARTICLE V
Powers
A. The powers of RMP to perform and accomplish the purposes set forth above shall be the
following, subject to the budgetary limits of RMP and the procedures set forth in these
Bylaws:
1. To provide coverage for all risks for which governmental units may lawfully self-
insure;
2. To pay liabilities for RMP Members in accordance with RMP Coverage
Documents and interlocal participation agreements entered into by the Members;
3. To charge and collect from Members contributions for the services provided to
Members, including the costs of operation;
4. To retain employees, agents and independent contractors necessary to administer
and achieve the purposes of RMP, including but not limited to attorneys,
accountants, fmancial advisors, claims and loss control administrators, actuaries,
investigators, experts, consultants and others;
5. To purchase and lease real property, equipment, machinery, and other personal
property;
6. To hold all funds contributed by Members and to invest such funds in investments
authorized by the Board pursuant to its investment policy;
7. To purchase stop loss insurance or excess insurance or reinsurance;
8. To carry out such other activities as are necessarily implied or required to carry
out the purposes of RMP;
9. To sue and be sued (the ability of RMP to sue and be sued shall not be construed
and is not intended as a waiver of RMP's sovereign immunity from suit or
liability);
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Approved August 16, 2007
10. To enter into contracts;
11. To enter into interlocal participation agreements with Texas governmental units
eligible under these Bylaws and to vary the provisions of such agreements in
accordance with the policies and decisions of the Board;
12. To require at any time the execution by a Member of a new interlocal
participation agreement within 30 days of the Member's receipt of such new
agreement, or in the absence of execution, to terminate the Member's participation
in RMP in accordance with Article XVI of these Bylaws;
13. To reimburse Directors for reasonable and approved expenses, but any expense
incurred in attending Board meetings shall be reimbursed in accordance with
TAC's travel policies in effect at the time the expense is incurred;
14. To purchase fidelity bonds from an insurance company approved by the Texas
Department of Insurance to write surety bonds in Texas;
15_ To provide or contract for claim adjustment services, network contracting
management, pharmacy management, eligibility management, underwriting and
other services necessary for the coverages provided;
16_ To contract with TAC or any entity representing any other program sponsored by
or associated with TAC in order to achieve economies in operations and
management or further shared objectives; and
17. To enforce the terms of the interlocal participation agreements into which it enters
with Members.
B. RMP shall have powers consistent with Texas law, the Charter Interlocal Agreement, the
Agreement and Plan of Merger, these Bylaws, the interlocal participation agreements
entered into with Members, and any amendments adopted hereto and as otherwise
provided by law.
ARTICLE VI
Participation
Membership in RMP shall be limited to governmental units of the State of Texas that
agree to abide by the standards for membership adopted by the Board, to abide by the Bylaws,
and to enter into interlocal participation agreements with RMP. The Board may establish a
minimum initial period of coverage for new members which shall be for a period of not less than
one year, subject to the payment of such sums and under the conditions established in these
Bylaws. The Board may apply a surcharge to any risk that does not meet the basic underwriting
criteria established by the Board or its designee. RMP may refuse to accept any applicant for
membership, if it does not meet the criteria established by RMP in this Plan of Operation.
4
Approved August 16, 2007
ARTICLE VII .
Obligations of Members
The obligations of the Members are:
A. To pay promptly all contributions or other payments to RMP at such times and in such
amounts as shall be established pursuant to these Bylaws, the interlocal participation
agreement, and the applicable Coverage Documents. Failure of a Member to pay its
contribution or other payment within 30 days of receipt of an invoice may result in the
assessment of a late fee at a rate not to exceed the maximum interest rate allowed by law.
B. To designate in writing a representative to serve as a coordinator with RMP (a "Pool
Coordinator"). The Pool Coordinator must be an employee or official of the Member.
The Pool Coordinator may be changed from time to time, provided that written notice of
such change is promply provided to RMP;
C. To allow RMP and the RMP Manager, and/or its agents, contractors, and officers,
reasonable access to all facilities of the Member and all records, including, but not
limited to, financial records, as required for the administration of RMP;
D. To cooperate fully with RMP's attorneys and the RMP Manager, and any other agents,
contractors, or officers of RMP in activities relating to the purposes and powers of RMP;
E. To provide RMP, upon request, information on exposures identified by RMP;
F. To allow attorneys and others designated by RMP to represent any Member in the
investigation, settlement, and litigation of any claim made against the Member within the
scope of the Coverage Documents; and
G. To report to RMP, in the form required by the Board or the RMP Manager and as
promptly as possible, all incidents or occurrences which would reasonably be expected to
result in RMP being required to consider a claim against the Member, its agents, officers,
or employees, within the scope of the Coverage Documents.
H. To cooperate in instituting any and all reasonable safety regulations that may be
recommended for the purpose of eliminating or minimizing hazards that may contribute
to losses.
I. To comply with any safety program adopted by the Board.
ARTICLE VIII
Char~es/Dividends
A. RMP shall charge the Members for the benefits and services provided, with such charges
being established by the Board.
B. Any surplus may be used by the Board to distribute dividends to Members in accordance
with policies or determinations adopted by the Board, may be used to reduce required
5
Approved August 16, 2007
contributions, may be retained in reserves or used in any other manner to strengthen or
benefit RMP, including merger with any other TAC sponsored intergovernmental pool.
ARTICLE IX
Board of Directors and Officers
A. Eli ibili An individual is not eligible to serve on the Interim Board, the Initial Board
or the Permanent Board unless the governmental unit the individual represents is a
member of RMP and a member of TAC.
B. Interim Board of Directors. The President of TAC shall appoint athree-person Board
from among the Trustees of the Charter Members, to be referred to as the Interim Board,
as soon as practicable after the creation of RMP, and shall appoint one of the Interim
Directors as Chair of the Interim Board. The term of the Interim Board ends on
December 31, 2007. Directors of the Charter Members' boards of trustees are eligible to
serve on the Interim Board. Any overlapping directorate that results from service on the
Interim Board shall not constitute a conflict of interest and such Trustee of a Charter
Board who is also an RMP Interim Director may participate fully in all RMP functions.
Alternatively, if there is a conflict of interest caused by the overlapping directorate, RMP
expressly waives such conflict of interest.
C. Initial Board of Directors. Effective January 1, 2008, the Initial Board of Directors shall
consist of all of the Trustees of the Boards of Trustees of the Charter Members, as they
were constituted on December 31, 2007. The term of office for the Initial Board shall be
the calendar year of 2008. The Initial Board shall serve until the Permanent Board is
appointed and approved.
D. Permanent Board of Directors.
(1) The Permanent Board of Directors shall consist of eleven (11) persons. No
Member may have more than one employee or elected official on the Board at any one
time. Any Director must be an employee or an elected or appointed official of a
governmental unit, as that term is defined in Texas Government Code Chapter 2259; that
is a Member of RMP. The withdrawal of a Member shall disqualify a Director or any
employee or elected or appointed official of the withdrawing Member. Any Director
who ceases to be an employee or elected official of a Member shall be disqualified to be
a Director. Notwithstanding any provision herein, a Permanent Director shall serve until
a successor takes office pursuant to these Bylaws.
(2) Directors for the Permanent Board shall be appointed by the President of
TAC, with the concurrence of the TAC Board of Directors. Four of such Directors, to be
known as Group A Directors, shall serve an initial term of one (1) year. Four of such
Directors, to be known as Group B Directors, shall serve an initial term of two (2) years.
Three of such Directors, to be known as Group C Directors, shall serve an initial term of
three (3) years.
6
Approved August 16, 2007
~ - (3) For a regular term, the President of TAC shall, with the concurrence of the
Board of Directors of TAC, appoint a person for each particular Director position. The
regular term of office shall be three (3) years. A Director may not serve more than two
(2) consecutive regular terms, but service as a Group A or Group B Director shall not
disqualify a Director from being appointed to a regular term immediately following that
Director's service as a Group A or Group B Director.
E. Any Director who fails to attend two (2) or more consecutive meetings, whether regular
or special, without having been excused by the Chairman, shall be deemed to have
resigned. However, the Director shall continue to serve on the Board until such time as
his successor is selected pursuant to the terms of paragraph D(2) set out above.
F. For a regular term, the Chairman and Vice Chairman of the Board shall be designated
annually by the President of TAC, with approval of the TAC Board of Directors. The
Chairman shall designate a Secretary, who may or may not be a Director, to keep the
minutes and records of the Board. A majority of Directors of the Board, as the Board is
constituted at the time, shall constitute a quorum. Concurrence of a majority of those
present and voting shall be necessary for any official action taken by the Board, except as
otherwise provided herein. Any vacancy on the Board due to death, resignation,
disqualification, or inability to act shall be filled for the unexpired term by selection of
another Director in the same manner that the original Director was selected. The
designation of a person to fill an unexpired term of a Director shall not be deemed to
create service in a consecutive term for purposes of the prohibition of paragraph D(3) of
this Article.
G. The duly appointed, qualified and acting Directors shall serve without compensation, but
shall be entitled to reimbursement of actual expenses incurred in the performance of their
official duties upon the approval of such expenses by the Board. Such reimbursement
shall be in accordance with the reimbursement policies of TAC as are currently in force.
H. RMP is not intended to be a trust and the Directors shall not be deemed to have the duties
of trustees under the Texas Trust Act, any other statute, or the common law. They may
act In accorda"uie with the buS111eSS judgment iLite anu Luc oLllGl ~iorisLlLLlerlliles uol+Llllle.
ARTICLE X
Powers and Duties of the Board of Directors
A. RMP's Board of Directors shall have all the powers and duties necessary for the
accomplishment of the purposes and goals of RMP, including but not limited to the
following specific powers and duties:
1. To contract for such professional services as it may deem necessary and to fix the
time, manner, and payment therefor;
2. To contract with any qualified organization to perform any of the functions
necessary for carrying out aself-insured pool arrangement, including any and all
7
Approved August 16, 2007
other services that the Board shall deem expedient for the proper servicing of those
Members who use the services of RMP;
3. To carry out or supervise the performance of all of the duties necessary for the
proper operation and administration of RMP on behalf of RMP Members and to
that end the Board shall have all of the powers necessary and desirable for the
effective administration of the affairs of RMP, including the power to delegate
certain functions to contractors as described herein;
4. To adopt rules to carry out the requirements of and implement these Bylaws and
Plan of Operation, the Charter Interlocal Agreement, the Agreement and Plan of
Merger and all interlocal participation agreements with its Members;
5. To establish the contributions and other payments to be paid by the Members;
6. To develop and prepare the interlocal participation agreement or agreements to be
entered into by counties or other governmental units to become Members of RMP,
including different agreements in accordance with differing financial arrangements
approved pursuant to policies of the Board (such as "cash flow" agreements);
7. To approve claims administration services providers and other service providers,
including but not limited to third-party administrators, necessary for the
administration of RMP, upon recommendation of the RMP Manager or its agents or
contractors;
8. To set a budget and any necessary revisions to the budget;
9. To establish policies for claims and loss control procedures;
10. To establish underwriting criteria;
11. To establish the fees, contributions, loss reserves and other financial arrangements
to cover the costs of operating RMP and providing coverages to RMP Members;
12. To establish policies for the investment and disbursement of funds;
13. To arrange for the investing of the monies of RMP in accordance with the Board's
investment policy and to open and maintain bank and other accounts as are deemed
necessary by the Board;
14. To have an audit performed by a certified public accountant at the end of each fiscal
year;
15. To form and delegate to committees to provide other services as needed by RMP;
16. To do all acts necessary and proper for the operation of RMP and implementation
of these Bylaws subject to the limits of the Bylaws and not in conflict with these
Bylaws;
Approved August 16, 2007
s
- 17. To implement the dissolution of and disbursement of assets of RMP following a
determination made pursuant to the provision. of Article III, paragraph E;
18. To select a qualified actuary, who shall conduct an annual review of RMP and
make recommendations to RMP Manager and Board based on such review;
19. To approve attorneys or firms of attorneys retained to represent Members in claims
within the scope of the Coverage Documents furnished by RMP or to delegate such
approval to the RMP Manager or its designee;
20. To require at any time the execution by a Member of a new interlocal participation
agreement within sixty (60) days of receipt of such new agreement by mail, or in
the absence of execution, to terminate the Member's participation in RMP at the
option of the Board, in accordance with Article XV of these Bylaws;
21. The Board shall have the general power to make and enter into all contracts, leases,
and agreements necessary or convenient to carry out any of the powers granted
under these Bylaws or under any other law. All such contracts, leases, and other
agreements shall be approved by resolution of the Board and shall be executed by
those individuals designated in such resolution. However, the Board's designee
shall have the power to execute interlocal participation agreements in accordance
with the policy or practice of the Board without the necessity of express Board
action on each such agreement. Additionally, the Board shall have the power to
delegate all the above mentioned functions to contractors as permitted under these
Bylaws or other law. In the absence of such designation or delegation, all
agreements shall be executed by the Chairman or Vice Chairman or the Executive
Director of TAC.
B. Annually, the Chairman of the Board shall appoint an Executive Committee of four (4)
Directors to handle the affairs of the Board between the regular Board meetings or any of
the called Board meetings. Any action taken by the Executive Committee is subject to
approval by the Board at the subsequent Board meeting. Any action taken which would
impose a contrac*~~al nbllgatlnn nn RMP shall 1Je reported lm__merllately to each Beard
member. Any such contractual obligation shall be honored by RMP for the period
between the creation of the obligation and any rescission at the next meeting of the
Board. The Chairman may appoint other committees with authority specifically granted
by the Board and subject to its supervision. The Board may dissolve the Executive
Committee and any other committee at any time.
C. The Board shall contract with TAC or its designee for general administrative services as
the RMP Manager. The contract shall include a reasonable fee to cover the cost of
administrative services being provided. Services to be provided by or through the RMP
Manager shall include, but not be limited to: negotiating terms of any insurance or
reinsurance contracts; bookkeeping services; financial statements; necessary reports on
claims, incidences and recording and depositing of payments; providing information to
potential members; reviewing claims from Members; reviewing and making
recommendations on all RMP :contracts; maintaining a complaint register; acting as a
9
Approved August 16, 2007
liaison with state authorities and responding to inquiries from state authorities;
computing and providing membership billings, filing required forms and reports with
state and other governmental authorities; maintaining appropriate files; assisting RMP's
auditor and actuary as necessary; reviewing the performance of all contract services
providers; coordinating banking functions, and handling deposits and reconciliations;
implementing investment policies established by the Board; supplying resource material
for Board meetings; attending Board meetings and other meetings necessary to the
administration of RMP; keeping detailed minutes of Board meetings; providing risk
management services; and administering committees established by the Board. The RMP
Manager may execute all contracts on behalf of RMP that are necessary to provide the
general administrative services described herein if any monies to be expended under the
contract are included in RMP's approved budget or any approved revisions thereto.
ARTICLE XI
Meetings of the Board of Directors
A. Meetings may be called by the Chairman or by a majority of the Directors or by
unanimously executed waiver of notice.
B. All acts of the Board shall require a majority vote of the Directors present, except as
otherwise specifically provided in these Bylaws.
C. If allowable by law, any meeting of the Board may be held by telephone conference call
in which all or certain of the Directors are not physically present at the place of the
meeting, but all or some participate in the conduct thereof by telephone. For the purpose
of determining the presence of a quorum and for all voting purposes at such a meeting, all
participating Directors shall be considered present and acting.
ARTICLE XLi
Indemnification and Liability
A. In this Article:
1. "Proceeding" means any threatened, pending, or completed action, suit, or other
proceeding, whether civil, criminal, administrative, arbitrative, or investigative,
any appeal thereof, and any inquiry or investigation that could lead to such an
action, suit, or other proceeding. "Proceeding" does not include an action to
discipline or terminate an employee.
2. "Expenses" includes court costs and attorneys' fees.
3. "Eligible Person," means a current or former Director of RMP, a current or
former Trustee or Officer of a Charter Member , a current or former Director,
Officer, or employee of TAC, and a current or former member of a committee
appointed by RMP, a Charter Member, or TAC. The term includes the estate of
an Eligible Person.
to
Approved August 16, 2007
B. RMP shall indemnify an Eligible Person in accordance with this Article.
C. Except as otherwise provided in this Article, RMP shall indemnify an Eligible Person for
a proceeding brought by any person or entity against the Eligible Person based on the
Eligible Person's current or former position or the duties he or she performed on behalf
of RMP, a Charter Member, or TAC. RMP shall indemnify the person against
judgments, penalties (including excise and similar taxes), fines, settlements, and
reasonable expenses actually incurred by the person in connection with the proceeding
and in the defense thereof.
D. For a proceeding brought by RMP against a person who is or was a Director of RMP,
RMP may indemnify the person only if RMP determines that a person similarly situated
could have reasonably believed that his or her conduct was in the best interest of RMP.
Indemnification shall be limited to reasonable expenses actually incurred by the person in
connection with the proceeding.
E. RMP may indemnify an Eligible Person in the case of a criminal proceeding if RMP
determines that the Eligible Person had no reasonable cause to believe that his or her
conduct was unlawful.
F. RMP may not indemnify an Eligible Person for obligations resulting from a proceeding
in which the person is found liable for theft from RMP, TAC, or a Charter Member.
G. Notwithstanding any other provision of this Article, RMP shall indemnify an Eligible
Person against reasonable expenses incurred in connection with a proceeding brought
against the person because he or she holds or held a position or performed duties on
behalf of RMP, TAC, or a Charter Member if the person is or was wholly successful, on
the merits or otherwise, in the defense of the proceeding.
H. A determination of indemnity under Paragraph D and of the reasonableness of expenses
must be made by the RMP Directors who are not named defendants or respondents in the
proceeding as follows:
1. By a majority vote of a quorum of the Directors eligible to vote on the matter;
2. By a majority vote of a committee composed of two or more eligible Directors
that is designated to act by a majority vote of all Directors; or
3. By special legal counsel selected by a majority vote of a quorum of the eligible
Directors or by a majority vote of the committee, as applicable, or by a majority
vote of all Directors if a quorum or committee cannot be established.
I. An Eligible Person may bring an action for RMP's failure or refusal to indemnify the
person. The action shall be brought in the District Court of Travis County, Texas for a de
novo determination.
J. The termination of a proceeding by judgment, order, settlement, or conviction or a plea of
polo contendere or its equivalent is not of itself determinative that the person to whom
11
Approved August 16, 2007
indemnity may be or may have been provided did not meet the requirements necessary
for indemnification under this Article.
K. RMP may indemnify and advance expenses to an Eligible Person who is not a current or
former Director or Trustee before the final disposition of the proceeding as may be
provided by specific action of the Board, or contract or as required by common law.
L. RMP may indemnify and advance expenses to a current or former RMP Director before
final disposition of the proceeding only after:
1. a determination by the entity designated in Paragraph H that the facts then known
by the entity would not preclude indemnification; and
2. the current or former Director provides a written affirmation of the person's good
faith belief that he or she has met the standard of conduct necessary for
indemnification and a written undertaking by or on the person's behalf to repay
the amount paid or reimbursed if it is ultimately determined that the person has
not met the standard. The written undertaking must be an unlimited general
obligation of the current or former Director but security is not required.
M. RMP may purchase and maintain insurance on behalf of any Eligible Person against any
liability asserted against the person because of the position held or the duties performed,
whether or not RNIP would have the power to indemnify the person against that liability
under this Article.
N. An Eligible Person is not personally liable to RMP or its Members for any acts
performed or omitted for RMP, except for theft from RMP.
O. The Fund may obtain a bond or other security to guarantee the faithful performance of
the duties of each Director.
P. The right of an Eligible Person to indemnification under these Bylaws vests at the time of
the alleged conduct upon which the proceeding is based, and the right of indemnification
survives any subsequent amendment of these Bylaws.
Q. In the event of invalidity of any portion of this Article, indemnity shall be provided in
accordance with and to the fullest extent permissible by law.
ARTICLE XIII
Bond
Each Director of the Board and each employee, as well as any employee of TAC who has
any authority over money in RMP or money collected or invested by RMP may be required by
the Board to execute a bond in an amount determined by the Board, conditioned on faithful
performance of his or her duties. The cost of the bond shall be paid by RNIl'.
12
Approved August 16, 2007
ARTICLE XIV
Withdrawal from Membership
A. Any Member may withdraw from RMP by giving at least sixty (60) days' written notice
to the Board and the RMP Manager of its desire to withdraw. All coverages provided by
RMP will terminate on the effective date of the withdrawal.
B. Any Member withdrawing shall be entitled to receive only its share of all dividends that
are given during or are declared by the Board to be calculated in accordance with a
period for which the withdrawing Member was a participant in RMP, subject to a set-off
for any outstanding obligation of such Member to RMP. Such share shall be calculated
in accordance with policies and determinations which are made by the Board. Except as
provided in this Paragraph, a withdrawing Member shall have no right to any portion of
the assets or accumulated surplus of RMP, including any renewal credit.
C. RMP shall continue the servicing of any pending claims after the withdrawal of the
Member unless the Member specifically assumes the liability and makes provision to
indemnify RMP from loss by taking over the servicing of the claim. RMP will have no
responsibility for payment or servicing of claims from an Administrative Services Only
contract Member after termination of the Administrative Services Only contract.
D. A Member that has withdrawn shall not be entitled to any reimbursement of contributions
that are to be paid or that shall become payable in the future, and shall continue to be
obligated to make payment for an obligation which arose prior to withdrawal and for any
additional period for which liability may be created by contract. If the withdrawal occurs
prior to the end of the Member's annual coverage period, normal short-rate earned
contribution factors will be utilized in calculating the Member's liability or refund.
ARTICLE XV
Expulsion of Members
A. By a majority vote of the Board, not including any Director disqualified pursuant to
l~rtirle XV B_~ any 1Vlember nay be expelled, S~~ch exrnulcinn~ whirLi shall take effect
sixty (60) days after such meeting, may be carried out for one or more of the following
reasons:
1. Failure to allow RMP or the RMP Manager reasonable access to all facilities and
records of the Member necessary for proper administration of RMP;
2. Failure to fully cooperate with the RMP Manager or other agent, contractor, or
any officer of RMP;
3. Failure to carry out any obligation of a Member which impairs the ability of RMP
to carry out its purposes or powers;
4. Failure to comply with the obligations of Members as set forth in Article VII of
these Bylaws;
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Approved August 16, 2007
5. Failure to execute a new interlocal participation agreement with RMP when
required under Article V, paragraph A.12 and under Article X, paragraph A.21 of
these Bylaws; or
6. Failure to control losses over an extended period have resulted in a financial loss
to RMP in any three of the past five years and when the Board determines that
this loss is the result of the action or inaction of the Member.
B. The vote of a Director who is employed by, an officer of, or otherwise representing a
governmental unit proposed to be expelled shall not be counted in determining the
number of votes required nor shall such Director be entitled to vote on the expulsion of
his or her own governmental unit.
C. Except for nonpayment of an obligation to RMP, no Member may be expelled except
after written notice from the Board of Directors of the alleged failure along with a
reasonable opportunity of not less than thirty (30) days to cure the alleged failure. The
Member may request a hearing before the Board before any final decision, which shall be
held within thirty (30) days after the expiration for the time to cure has passed. A
decision by the Board to expel a Member after notice of hearing and failure to cure the
alleged defect shall be final and take effect sixty (60) days after the decision to expel is
rendered by the Board. After expulsion, the former Member shall continue to be liable
for any unpaid contributions and to make any payment for which an obligation arose
prior to expulsion or in accordance with any contract provisions. The expelled Member
shall not be entitled to any reimbursement of contributions that are to be paid or that shall
become payable in the future; provided, however, the expelled Member shall be entitled
to receive all dividends which are given in accordance with Board determinations,
subject to a set-off for any outstanding obligation to RMP. If the Member is expelled
prior to the end of Member's annual coverage period, normal short-rate earned premium
factors will be applied to determine the obligation of the Members.
D. Notwithstanding any other provision in these Bylaws, the Board may terminate the
membership and expel a Member without further notice if any payment owed by the
IvZ~,nbei to tuvir remains outstanding oeyona sixty X00) days of the aue oats.
E. Expulsion shall be in addition to any other remedy which otherwise exists.
F. All of a Member's coverages shall terminate on the effective date of the Member's
expulsion.
ARTICLE XVI
Contractual Obligation
A. An original or certified or attested copy of each Member's executed interlocal
participation agreement shall remain on file with RMP.
B. Except to the extent of the financial contributions to RMP agreed to herein or such
additional obligations as may come about through amendments to these Bylaws, no
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Approved August 16, 2007
Member agrees or contracts herein to be .held responsible for any claims made against
any other Member. The contracting parties intend in the creation of RMP to establish an
organization to operate only within the scope herein set out and have not herein created
as between Member and Member any relationship of surety, indemnification or
responsibility for the debt of or claims against any other Member. The parties do not
intend to create a trust, partnership, joint venture or other joint enterprise.
ARTICLE XVII
Fiscal Year
The fiscal year of RMP shall be the calendar year or other twelve (12) month period as
established by the Board of Directors.
ARTICLE XVIII
Severability
In the event that any article, provision, clause or other part of these Bylaws is held
invalid or unenforceable by a court of competent jurisdiction, such validity or unenforceability
shall not affect the validity or enforceability with respect to other articles, provisions, clauses,
applications or occurrences, and these Bylaws are declared to be severable.
ARTICLE XIX
Amendment of Bylaws
A. Any amendment to the Bylaws shall become binding on any RNIP Member upon its
adoption. The provisions of any amendment which alter the rights of a Member which
would otherwise exist under a contract shall be effective on the thirtieth (30th) day after
written notice of the provision has been served on the Member in accordance with the
contract provisions, or otherwise as the parties may agree.
B. These Bylaws may be altered, amended or repealed by a majority of the Board of
Directors of TAC present at any regular meeting or at any special meeting of the TAC
Board of Directors if at least two days written notice is given of an intention to alter;
amend or repeal these Bylaws or to adopt new Bylaws at such meeting. The Board of
Directors of RMP may recommend such changes as it deems necessary or desirable to the
Board of Directors of TAC.
ARTICLE XX
Notices
A. Any notice required or permitted by these Bylaws to be given to a Director, officer, or
Member of RMP may be given by facsimile, mail, telegram, or e-mail. If mailed, a
notice is deemed delivered when deposited in the mail addressed to the person at his or
her address as it appears on the RMP's records, with postage prepaid. If given by
telegram, a notice is deemed delivered when accepted by the telegraph company and
addressed to the person at his or her address as it appears on the RMP's records. If by
facsimile transmission, a notice is deemed delivered when printed confirmation of receipt
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Approved August 16, 2007
is obtained from the transmitting mechanism. A person may change his or her address in
the RMP's records by giving written notice of the change to the secretary of RMP.
B. Whenever any notice is required by law or these Bylaws, a written waiver signed by the
person entitled to receive such notice is considered the equivalent to giving the required
notice. A waiver of notice is effective whether signed before or after the time stated in
the notice being waived.
C. A person's attendance at a meeting constitutes waiver of notice of the meeting unless the
person attends for the express purpose of objecting to the transaction of any business
because the meeting was not lawfully called or convened.
ARTICLE XXI
Miscellaneous Provisions
A. These Bylaws shall be construed under Texas law. All references in these Bylaws to
statutes, regulations, or other sources of legal authority shall refer to the authorities cited,
or their successors, as they maybe amended from time to time.
B. To the greatest extent possible, these Bylaws shall be construed to conform to all legal
requirements and all requirements for obtaining and maintaining all tax exemptions that
may be available to unincorporated associations such as RMP. Venue for any dispute
arising out of or under these Bylaws shall be in Travis County, Texas.
C. The headings used in the Bylaws are for convenience and may not be considered in
construing the Bylaws:
D. All singular words include the plural, and all plural words include the singular.
E. A person may execute any instrument related to RMP, except a vote or written consent of
a Director, by means of a power of attorney if an original executed copy of the power of
attorney is provided to the Secretary to be kept with RMP's records.
F. The Bylaws will bind and inure to the benefit of the Directors, officers, employees, and
agents of RMP and their respective heirs, executors, administrators, legal representatives,
successors, and assigns except as the Bylaws otherwise provide.
Rescisison of Merger Provisions
In the event that the operation of RMP is deemed to be inefficient, inconvenient or
inappropriate for any reason, the Board of RMP, with the consent of the TAC Board, may
rescind the contract of merger, thereby reconstituting the Charter Members and restoring all
assets and liabilities to the Charter Members. The restoration of assets and liabilities may be
accomplished by the appointment, by the RMP Board, of a dissolution administrator, who shall
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make the restoration by any fair method, taking into account, as a significant factor, the initial
~~
` percentages of contribution of assets and liabilities by the three pools to RMP. The
administrator's estimate of profitability or losses of each coverage marketed subsequent to the
creation of RMP shall be taken into account, recognizing that a precise accounting cannot be
accomplished. The administrator shall have no liability for negligence in the performance of the
tasks under this section. In addition, the assets of RMP shall remain available to indemnify him
for any negligence in the performance of such duties. The boards of trustees of the reconstituted
pools shall be appointed by the TAC President pursuant to the terms of the bylaws of each pool
as they existed prior to the merger.
CERTIFICATE
I am the secretary of the Texas Association of Counties Risk Management Pool, and the official
custodian of its records. I hereby certify that this document is a true and correct copy of the current
version of RMP's Bylaws, as kept in the normal course of business.
Dated:
Bv:
Board Secretary
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