ANNUAL REPORT

2015

PUBLIC ENTITY RISK MANAGEMENT AUTHORITY

PUBLIC ENTITY RISK MANAGEMENT AUTHORITY

ANNUAL REPORT 2015

TABLE OF CONTENTS

About PERMA ............................................................................................................ 1

Coverage Programs ................................................................................................... 1

Program Participation ................................................................................................. 2

Member Services ....................................................................................................... 3

CAJPA Accreditation .................................................................................................. 5

Board of Directors ...................................................................................................... 6

Executive Committee ................................................................................................. 7

Mission Statement ...................................................................................................... 7

General Liability Program ........................................................................................... 8

Workers’ Compensation Program ............................................................................ 13

Financial Statements and Graphs ............................................................................ 18

Investment Report .................................................................................................... 22

Staff and Service Providers ...................................................................................... 23

-1-

ABOUT PERMA

The Public Entity Risk Management Authority (PERMA) was created in 1985 for the purpose of jointly funding programs of insurance. PERMA is a risk retention pool with 32 members, consisting of 22 cities, 3 transit agencies, and 7 special districts. PERMA is governed by a Board of Directors, which consists of one representative from each member agency. The Board meets three times a year. The Board elects an Executive Committee, which meets in between Board meetings to supervise and conduct PERMA affairs. The day-to-day business of PERMA is handled by a full-time staff headed by a General Manager. Coverage programs available to PERMA members: General Liability. The General Liability Program provides defense and indemnity coverage against claims and suits arising from covered occurrences. It provides $50 million in broad form general liability coverage, which includes auto liability, bodily injury and property damage, personal injury, and public officials errors and omissions. Members select from a self-insured retention (SIR) of $0, $5,000, $10,000, $25,000, $50,000, $75,000, $100,000, $125,000, $250,000, or $500,000. Cyber Liability. This new program provides coverage for information security & privacy liability, privacy notification costs, regulatory defense & penalties, website media content liability, cyber extortion, first party data protection & business interruption losses. Workers’ Compensation. The Workers’ Compensation program provides statutory benefits for employee injuries arising out of and in the course of employment. It provides statutory limits in workers’ compensation coverage and $5,000,000 in employers’ liability coverage. Members select from a self-insured retention (SIR) of $50,000, $100,000, $150,000, $200,000, or $250,000. Property. The Property program is a fully insured program providing all-risk replacement cost coverage. Automobile physical damage coverage is also available on a replacement cost basis. Employment Practices Liability. The EPL program provides members coverage for employment related lawsuits, such as wrongful termination and discrimination, through participation in the Employment Risk Management Authority (ERMA). ERMA provides $1 million in employment practices liability coverage. Additional limits in EPL coverage is provided by CSAC-EIA. Crime Coverage. This program provides public employee dishonesty, forgery or alteration, and computer fraud coverage with a $1,000,000 limit of insurance. Special Events. The Special Events program is a fully insured program allowing members of the public to purchase Liability Insurance at a substantially reduced cost for functions (such as weddings, parades, meetings) held on member premises. Employee Benefits. The Employee Benefits program is a fully insured program providing a wide range of health and welfare benefits and services.

Year

Joined

Member

Liability

W/C

Property

APD

ERMA

Crime

1985-86 City of Barstow X X X X X X

1985-86 City of Perris X X X X X X

1985-86 City of Westmorland X X X X

1986-87 City of Banning X X X X X X

1986-87 City of Blythe X X X X X

1986-87 City of Cathedral City X X X

1986-87 City of Coachella X X X X X X

1986-87 City of Desert Hot Springs X X X X X X

1986-87 City of Holtville X X X X X X

1986-87 City of Norco X X X X

1986-87 City of Rancho Mirage X X X X X

1986-87 City of San Jacinto X X X X X

1986-87 City of Stanton X X X X X X

1986-87 SunLine Transit Agency X X X X X

1991-92 City of Murrieta X X X X X

1993-94 City of Adelanto X X X X X X

1996-97 March JPA X X X X

1996-97 MD&MIWMA X

1996-97 VVEDA X

1996-97 VVTA X X X X X

1997-98 Palo Verde Valley Transit X X

1997-98 City of Victorville X X X

2002-03 IVECA X X

2002-03 City of La Mesa X X X X X X

2005-06 Palm Springs Aerial Tramway X X X X X

2009-10 City of Moreno Valley X X X X

2010-11 City of Hesperia X X X X X X

2010-11 ICTC X X X

2010-11 City of Eastvale X X X X X

2011-12 City of Canyon Lake X X X X X

2011-12 City of Jurupa Valley X X X X X

2013-14 Regional Training Center X X X

Cyber

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

X

Total 32 30 18 25 24 21 24

PROGRAM PARTICIPATION

-2-

MEMBER SERVICES

► Actuarial Services — Members of the Liability and Workers’ Compensation programs are

provided with estimated outstanding liabilities and funding rates within their selected self-insured retention at no additional cost.

► WeTip — WeTip is a nonprofit organization that takes anonymous crime tips nationwide. This

is an optional participation program offered at a discounted fee. 14 members participate in this program and 752 tips were reported this year for a total to date of 11,783.

► Special Events/SPARTA — Event holders and contractors can apply directly on-line or call a

toll free number to obtain quotes. Premium payments are paid directly to the program administrator, relieving the Member from the administrative process. 35 special events policies were issued this year, compared to 25 last year. One SPARTA policy was issued this year, compared to one last year.

► Video Rentals — Members have access to a library of over 10,000 safety videos. However,

no videos were rented this year. The decline in rentals is attributed to the availability of free streaming videos and recorded webinars.

► On-Site Training — PERMA members may be reimbursed for 75% of the actual expenses

which they incur for the training of their employees and staff on risk management matters, to a maximum of $3,000 per program year. This year, 5 members were reimbursed a total of $8,067. Last year, 6 members were reimbursed a total of $12,211.

► Workshops — Live workshops and webinars, such as Social Media, Accommodating

Disabled Employees, Disability Interactive Process, and Employment Best Practices for Managers were well attended by the membership.

► Agility Recovery — Members have access to industry-leading disaster planning tools and

resources by subscribing to this service. Agility provides access to four key elements of recovery: power generators, office space, technology, and satellite connectivity for phone and Internet access.

-3-

MEMBER SERVICES

► Risk Control Services — PERMA contracts with Bickmore Risk Services for risk control

services, which include on-site training and consulting, webinars, streaming videos, sample programs and development, safety communications, and telephone hotline.

► Claims Administration — PERMA provides in-house claims administration under the

Liability program and a TPA of choice option under the Workers’ Compensation program. On-line access is available.

► Claim Audits — Claim audits for the Liability and Workers’ Compensation programs are

conducted on a biannual basis. ► Subrogation — 79 claims were submitted for recovery this year, compared to 42 last year.

Staff recovered on 44 of the claims to date for a total of $159,634, compared to last year’s recovery of $194,3602. Since 1996, staff has recovered $1,134,307 on behalf of the members.

► Small Claims Court Appearances — 7 appearances were made this year, resulting in 6

defense awards and 1 plaintiff award. Last year, 8 appearances were made, resulting in 7 defense awards and 1 settlement.

► Lexipol Policy Manuals — 6 out of 8 members with police departments subscribe to the

Lexipol law enforcement policy manual. Additionally, 1 member subscribes to the Lexipol custody policy manual and another member subscribes to the fire policy manual.

► PERMA Website — The PERMA website is the central location for obtaining information

regarding governance, programs, services, and meetings.

-4-

13-14 Claims GL W/C

Received 404 299

Closed 423 343

Open @ 6/30 257 498

14-15 Claims GL W/C

Received 394 288

Closed 342 268

Open @ 6/30 309 518

CAJPA ACCREDITATION

PERMA has been accredited with excellence by the

California Association of Joint Powers Authorities

(CAJPA) since 1997. CAJPA sponsors the nation’s

first risk management accreditation program. This

program establishes a model of professional

standards, which serves as a guidelines for all risk

management pools regardless of size, scope of

operation, or membership structure.

Only 54 out of an estimated 150 risk

management joint powers authorities

have been accredited with excellence by

the California Association of Joint Powers

Authorities (CAJPA).

-5-

CAJPA was formed in 1981. The

pooling concept for insurance pur-

poses was relatively new and fairly

obscure. JPAs ventured alone in

unchartered waters as they wres-

tled new and perplexing problems.

CAJPA was formed to meet the

need for communication and coop-

eration among the newly formed

JPAs. Its founders structured an

association that serves as an in-

formation and educational net-

work; one that has grown to also

promote unique insurance and risk

management concepts and ser-

vices for its members.

Member Agency Director Alternate

Adelanto Lillian Salcido Larry Jarvis

Banning Rita Chapparosa -

Barstow Ava Reyes -

Blythe Mallory Sutterfield Christa Elms

Canyon Lake Ariel Hall -

Cathedral City Tami Scott Sylvia Zelnys

Coachella Bill Pattison Sandy Krause

Desert Hot Springs Joe Tanner Martin Magana

Eastvale Marc Donohue -

Hesperia Brian Johnson Rita Perez

Holtville Denise Garcia Nicholas Wells

ICTC Mark Baza Michelle Bastidas

IVECA Rodolfo Aguayo -

Jurupa Valley Gary Thompson Alan Kreimeier

La Mesa Rida Freeman -

March Joint Powers Authority Ellen Stephens -

MD&MIWMA John Davis -

Moreno Valley Chris Paxton Michele Patterson

Murrieta Joy Canfield Dr. Kimberly Foxworth

Norco Andy Okoro Myrna Paakkonen

Palm Springs Aerial Tramway Marjorie De La Cruz Tara Meinke

Palo Verde Valley Transit Agency George Colangeli Dale Reynolds

Perris Isabel Carlos Saida Amozgar

Rancho Mirage Kim Malcolm-Valente Britt Wilson

San Jacinto Tim Hults Carolyn Durden

Stanton Cynthia Guzman Stephen Parker

SunLine Transit Agency Luis Garcia Eric Taylor

VVEDA Keith Metzler -

Victor Valley Transit Authority Kevin Kane -

Victorville Charles Buquet -

Westmorland Sally Traylor -

SD Regional Training Center Michael Gray Marisa McCullough

-6-

GOVERNING BODY

BOARD OF DIRECTORS PERMA is governed by a Board of Directors, which consists of one director and at least one alternate from each agency. Each member agency, regardless of size, is afforded one vote.

GOVERNING BODY

EXECUTIVE COMMITTEE The Executive Committee, which meets monthly, is elected from the Board. There are seven members on the Executive Committee: President, Vice-President and five Members-at-Large. The Executive Committee consists of the following Board members as of June 2015:

President

Chuck Buquet, City of Victorville

Vice-President

Kevin Kane, Victor Valley Transit Authority

Members-at-Large

Isabel Carlos, City of Perris

Kim Malcolm-Valente, City of Rancho Mirage

Myrna Paakkonen, City of Norco

Chris Paxton, City of Murrieta

Joe Tanner, City of Desert Hot Springs

MISSION STATEMENT

The Public Entity Risk Management Authority (PERMA) is a member-directed pool dedicated to providing financially secure, stable, and cost

effective coverage programs and risk management services for its members.

-7-

GENERAL LIABILITY PROGRAM The General Liability program provides defense and indemnity coverage against claims and suits arising from covered occurrences. For the 2014-15 policy year, the limit of coverage is $50,000,000 per occurrence, with self-insured retentions (SIRs) ranging from $0 to $500,000. All member entities participate in this program, generating $5 million in deposit premium.

The above Losses by Policy Year chart shows the actuarial projection for ultimate losses, including the losses within members’ self-insured retentions.

The Frequency and Severity charts illustrate the highest number of claims filed (frequency) and the total amount incurred (severity) by cause of loss for the 5 year period of 07/01/10 through 06/30/15.

$3,184 $3,001

$5,593

$2,762

$931

$3,570

$2,204

$6,541

$2,849 $3,101

$0

$2,000

$4,000

$6,000

$8,000

06 07 08 09 10 11 12 13 14 15

Thousands

Losses by Policy Year

Claim Payments Reported Reserves IBNR Reserves

0 50 100 150 200 250 300

Power Failure

Police Force

False Arrest

Water/Flood

Sewer Backup

Construction Zone

City Trees

Road Design

Slip & Fall

Road Condition

Negligence

Agency Vehicle

Potholes

Other

Frequency

$0 $2,000,000 $4,000,000

Power Failure

Potholes

Construction Zone

Road Condition

Negligence

City Trees

Sewer Backup

False Arrest

Police Force

Water/Flood

Slip & Fall

Other

Agency Vehicle

Road Design

Severity

-8-

GENERAL LIABILITY PROGRAM The following charts provide the membership payroll for the last 10 years and the loss rate per $100 of payroll for the same 10 years. The loss rate is calculated by dividing the total incurred by the pay-roll. The total incurred does not include IBNRs.

-9-

$ 2.13

$ 1.79

$ 2.94

$ 1.42

$ 0.45

$ 1.72

$ 1.06

$ 2.80

$ 1.05

$ 0.45

$ 0.00

$ 0.50

$ 1.00

$ 1.50

$ 2.00

$ 2.50

$ 3.00

$ 3.50

$ 4.00

06 07 08 09 10 11 12 13 14 15

Loss Rate per $100 Payroll

Loss Rate 3 Year Moving Avg $1.55 Average

149.7 167.9 

190.3  194.1 208.5  208.1  203.4  198.4  204.3  206.0 

$0

$50

$100

$150

$200

$250

06 07 08 09 10 11 12 13 14 15

Millions

Total Payroll

Payroll

GENERAL LIABILITY PROGRAM The following charts provide the claim count for the last 10 years and the average cost per claim for the same 10 years. The average cost per claim is calculated by dividing the total incurred by the number of claims. The total incurred does not include IBNRs.

-10-

Total 10 Year Claim Count: 3,406 - Open: 304, 9% - Litigated: 404, 12%

302 295

378

297

355

444

331348

365

291

47 43 50 37 40 55 43 40 3712

0

100

200

300

400

500

06 07 08 09 10 11 12 13 14 15

Claim Count by Program Year

All Open Litigated

0

20

40

60

80

100

120

06 07 08 09 10 11 12 13 14 15

Thousands

Average Cost per Claim

All Claims Litigated Claims Non‐Litigated Claims

$8,760 Average $51,938 Average $2,949 Average

GENERAL LIABILITY PROGRAM

The following charts illustrate the pool performance for each of the policy years. The charts clearly depict that claims experience affects the success of each program year.

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15

Revenues(000)

Deposit Premiums PERMA - Assessments Other - Dividends Investment Income

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15

Expenses(000)

Claim Payments Claims Payable G&A/Direct/Insurance CostsPERMA - Dividends Interest Charge Other - Assessments

0500

1,0001,5002,0002,5003,0003,5004,000

86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15

Net Position(000)

-11-

GENERAL LIABILITY PROGRAM

Each member’s net position below is based upon the member’s net position in each policy year. Some policy years report an excess of premiums over estimated claims and expenses, which results in a positive net position. Other policy years report a deficiency of premiums, which results in a deficit net position. The assignment of a particular policy year’s surplus or deficiency to each member is based upon each member’s percentage of premiums paid for that particular policy year. This is an approximation at this time and is subject to future changes in premium contributions and claims data. As of June 30, 2015, each member’s net position is estimated as follows:

-12-

Member Net Position Member Net Position

Adelanto $497,847 San Jacinto $369,977

Banning $1,756,191 Sierra Madre $4,579

Barstow $716,862 Stanton $285,742

Blythe $474,430 SunLine Transit Agency $909,287

Canyon Lake $14,777 Tulelake $28,193

Cathedral City $822,091 Victorville $1,710,924

Coachella $383,355 VVEDA $24,691

Desert Hot Springs $931,426 VVTA $36,291

Eastvale $25,305 Westmorland $66,938

Hesperia $614,954

Holtville $206,303 Total $16,235,988

ICTC $15,573

IVECA $24,518

Jurupa Valley $7,893

La Mesa $2,310,354

March JPA $141,173

MD&MIWMA $24,691

Moreno Valley $643,711

Murrieta $1,202,487

Norco $588,913

PS Aerial Tramway $336,766

PVVTA $24,707

Perris $666,011

Rancho Mirage $362,354

Regional Training Center $6,674

WORKERS’ COMPENSATION PROGRAM The Workers’ Compensation program provides statutory benefits for employee injuries arising out of and in the course of employment, and employers’ liability coverage. For the 2014-15 policy year, the program provides statutory limits for workers’ compensation coverage and $5,000,000 in employers’ liability coverage. Each member self-insures up to $250,000 per accident or employee. Eighteen member entities participate in this program, generating $7 million in deposit premium.

The above Losses by Policy Year chart shows the actuarial projection for ultimate losses, including the losses within the members’ self-insured retentions.

-13-

The Frequency and Severity charts provide the highest number of claims filed (frequency) and the total amount incurred (severity) by department for the 5 year period of 07/01/10 through 06/30/15.

$6,316

$4,296

$5,786 $5,915

$8,130$7,139

$5,464

$8,040

$6,815$7,571

$0

$2,000

$4,000

$6,000

$8,000

$10,000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Thousands

Losses by Policy Year

Claim Payments Reported Reserves IBNR Reserves

0 100 200 300 400 500 600

Parks

Comm Srvcs

Admin

Comm Dvlpmnt

Utilities

Transit

Fire

Public Works

Police

Frequency

$0 $5,000,000 $10,000,000

Comm Srvcs

Parks

Comm Dvlpmnt

Admin

Utilities

Transit

Public Works

Fire

Police

Severity

WORKERS’ COMPENSATION PROGRAM The following charts provide the membership payroll for the last 10 years and the loss rate per $100 of payroll for the same 10 years. The loss rate is calculated by dividing the total incurred by the pay-roll. The total incurred does not include IBNRs.

-14-

$144.8 

$163.0 

$185.1  $188.5  $182.7  $179.2  $179.3  $175.9  $180.7  $181.5 

$0

$20

$40

$60

$80

$100

$120

$140

$160

$180

$200

06 07 08 09 10 11 12 13 14 15

Millions

Total Payroll

Payroll

$4.28 

$2.61 

$3.03  $3.03 

$4.30 

$3.65 

$2.75 

$3.78 

$2.58 

$1.81 

 $‐

 $0.50

 $1.00

 $1.50

 $2.00

 $2.50

 $3.00

 $3.50

 $4.00

 $4.50

 $5.00

06 07 08 09 10 11 12 13 14 15

Loss Rate per $100 Payroll

Loss Rate 3 Year Moving Avg $3.16 Average

WORKERS’ COMPENSATION PROGRAM The following charts provide the claim count for the last 10 years and the average cost per claim for the same 10 years. The average cost per claim is calculated by dividing the total incurred by the number of claims. The total incurred does not include IBNRs.

-15-

Total 10 Year Claim Count: 3,187 - Open: 438, 14%

350  343  333 349  347 

307  303  307 293 

255 

16  12  15  21  25  33  44 

77  82 113 

 ‐

 100

 200

 300

 400

06 07 08 09 10 11 12 13 14 15

Claim Count by Program Year

All Claims Open

$17.7 

$12.4 

$16.8  $16.4 

$22.6 $21.3 

$16.3 

$21.6 

$15.9 

$12.9 

 $‐

 $5

 $10

 $15

 $20

 $25

06 07 08 09 10 11 12 13 14 15

Thousands

Average Cost per Claim

All Claims $17,479 Average

WORKERS’ COMPENSATION PROGRAM The following charts illustrate the pool performance for each of the policy years. The risk sharing arrangement was established July 1, 2002.

-16-

0

500

1,000

1,500

2,000

2,500

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Revenues(000)

Investment Income Other - DividendsPERMA - Assessments Deposit Premiums

0

500

1,000

1,500

2,000

2,500

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Expenses(000)

Claim Payments Claims Payable G&A/Direct/Insurance CostsPERMA - Dividends Interest Charge Other - Assessments

(200)

(100)

0

100

200

300

400

500

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Net Position(000)

WORKERS’ COMPENSATION PROGRAM Each member’s net position is based upon that member’s net position in each policy year. Some policy years report an excess of premiums over estimated claims and expenses, which results in a positive net position. Other policy years report a deficiency of premiums, which results in a deficit net position. The assignment of a particular policy year’s surplus or deficiency to each member is based upon each member’s percentage of premiums paid for that particular policy year. This is an approximation at this time and is subject to future changes in premium contributions and claims data. As of June 30, 2015, each member’s net position is estimated as follows:

Member Net Position Member Net Position

Adelanto $36,338 Norco $66,060

Banning $157,311 Perris $60,190

Barstow $221,860 Rancho Mirage $48,333

Blythe $115,926 San Jacinto $45,629

Cathedral City $252,709 Stanton $15,225

Coachella $48,597 SunLine Transit $203,649

Desert Hot Springs $91,073 Victorville $157,011

Hesperia $48,020

Holtville $42,681 Total $2,043,190

La Mesa $220,338

Murrieta $212,240

-17-

Workers’ Compensation

Program

Workers’ Compensation

Program—Effective July 1, 2015

FINANCIAL STATEMENT Audited Financial Statement as of June 30, 2015

Liabil ity, 52.9%

W/C, 43.9%

Other Programs, 

3.2%

Assets by Program

-18-

Liability, 23.4%

W/C, 71.2%

Other Programs, 

5.4%

Liabilities by Program

Liability, 88.8%

W/C, 11.2%

Net Position by Program

Assets

Cash and cash equivalents $5,117,096

Accounts receivable 920,549

Member receivable 90,480

Interest receivable 122,189

Prepaid expenses 41,076

Deposits with others 507

Investments 33,339,705

Capital assets 844,194

Total assets 40,475,796

Deferred Outflows of Resources 83,195

Liabilities and Net Position

Accounts payable $69,367

Pre-litigation defense 4,446

Property valuation 8,484

Compensated absences 52,369

Member deposits 13,264,825

OPEB 50,185

Claim reserves/IBNRs 8,100,046

Net position 18,279,178

Total liabilities and net position $40,558,991

Net Pension Liability 542,415

Deferred Inflows of Resources 187,676

Total $40,558,991

Statement of Net Position

FINANCIAL STATEMENT Audited Financial Statement as of June 30, 2015

Statement of Activities

-19-

Liabil ity, 88.8%

W/C, 11.2%

Net Position by Program

Liability, 76.9%

W/C, 23.1%

Expenses by Program

Liability, 71.8%

W/C, 28.2%

Revenue by ProgramOperating revenues

Deposit premiums $7,413,630

Excess insurer returns/premium adjustments 324,337

Total operating revenues 7,738,125

Operating expenses

Provision for claims and claim adjustment expenses

2,806,345

Excess insurance 1,848,881

Salaries and benefits 698,345

Professional services 852,830

Maintenance and operations 391,811

Member dividends/returns 1,228,461

Total operating expenses 7,826,673

Operating loss -88,548

Non-operating income

Investment earnings 206,769

Net increase in fair value of investments 183,521

Total non-operating income 390,290

Change in net position 301,742

Beginning net position 17,977,436

Ending net position $18,279,178

Other income 158

FINANCIAL GRAPHS The following Balance Sheet graph provides you with a ten year comparative history of the organization’s financial position at June 30th.

The net position of PERMA decreased by $362 thousand or 1.9% — $18.3 million at June 30, 2015

compared to $18.6 million at June 30, 2014. The financial position changed as a result of the

revenue and expense fluctuations described below.

Operating revenues increased by $492 thousand (6.8%), which includes $324 thousand in dividends and premium adjustments from its excess insurers.

Operating expenses increased by $1.4 million (22.3%), due to an increase in the provision for claims and claims adjustment expenses ($1.14 million or 68.1%).

The Board agreed to return $1.2 million in dividends during the 2014-15 fiscal year, about the same as the prior annual returns.

Non-operating income (investment earnings and fair value adjustments) decreased $30 thousand (7.2%) from the prior year.

-20-

$0

$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

$30,000,000

$35,000,000

$40,000,000

$45,000,000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Statement of Net Positions

Assets & Deferred Outflows Liabilities & Deferred Inflows Net Position

Member Dividends

9%

Personnel5%

Professional Services6%

Maintenance & Operations

1%

Insurance27%

Claims Paid50%

Cost of Operations

2013‐14

Member Dividends

11%

Personnel5%

Professional Services6%

Maintenance & Operations

1%Insurance

28%

Claims Paid47%

Cost of Operations

2014‐15

FINANCIAL GRAPHS The following charts depict the amount paid on behalf of all programs at the pooled layers and within member retention, during the last two fiscal years for claim payments, personnel, maintenance & operations, professional services, insurance, and dividends.

2014-15 2013-14 2012-13 2011-12 2010-11

Claims Paid $6,298,024 $6,678,968 $6,952,893 $7,157,842 $6,880,536

Personnel $698,345 $697,042 $851,063 $668,010 $672,636

Maintenance & Operations $391,811 $375,495 $354,312 $281,499 $279,965

Professional Services $864,472 $866,927 $831,288 $771,548 $751,069

Insurance Expense $3,681,873 $3,607,846 $3,528,077 $3,790,259 $3,759,683

Dividends $1,474,920 $1,203,492 $1,543,629 $2,130,673 $1,637,413

Total $13,409,445 $13,429,770 $14,061,262 $14,799,831 $13,981,302

-21-

INVESTMENT REPORT Falling interest rates and yields continue to impact our investment earnings—we expect earnings to continue at these lower rates in the near term. Our emphasis, in order of priority, continues to be safety, liquidity and yield.

-22-

$0

$10,000,000

$20,000,000

$30,000,000

$40,000,000

$50,000,000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Cash & Investments

Cash LAIF Treasury Obligations

Federal Agency Obligations Corporate Notes Municipal Bonds

Certificates of Deposits

0%

20%

40%

60%

80%

100%

1 2 3 4 5 6 7 8 9 10

Number of Years

Investments PurchasedDistribution of Maturity Dates

2010‐11

2011‐12

2012‐13

2013‐14

2014‐15

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Investment Rate of Return

STAFF

Scott Ellerbrock, General Manager

Kerry Trost, Liability Claims Manager

Michael Caton, Financial Analyst

Karon Patterson, Liability Claims Specialist

Jennifer Martin, Secretary

TREASURER

Andy Okoro

CITY OF NORCO

BOARD COUNSEL

Austin Gibbons

GIBBONS & CONLEY

BROKER OF RECORD

Seth Cole

ALLIANST INSURANCE SERVICES

FINANCIAL AUDITOR

David Becker

JAMES MARTA & COMPANY

ACTUARY

Mujtaba Datoo

AON RISK SOLUTIONS

INVESTMENT MANAGER

PFM ASSET MANAGEMENT

WORKERS’ COMPENSATION TPAS

ADMINSURE

CORVEL

YORK RISK SERVICES

RISK CONTROL

Terrie Norris

BICKMORE

SPECIAL EVENTS

MERRIWETHER & WILLIAMS

ALLIANT INSURANCE SERVICES

36-951 Cook Street, Suite 101

Palm Desert, CA 92211

Tel (760) 360-4966 ~ Fax (760) 360-3264

www.perma.dst.ca.us

-23-

30 Years

1985 — 2015

Public Entity

Risk Management Authority