Item No. 1
Town of Atherton
CITY COUNCIL STAFF REPORT – ACTION ITEM
TO: HONORABLE MAYOR AND CITY COUNCIL
GEORGE RODERICKS, CITY MANAGER
FROM: ROBERT BARRON III, ASSISTANT CITY MANAGER/FINANCE
DIRECTOR
DATE: NOVEMBER 5, 2025
SUBJECT: A RESOLUTION OF THE CITY COUNCIL OF THE TOWN OF
ATHERTON CONSENTING TO JOIN THE POOLED LIABILITY
ASSURANCE NETWORK (PLAN) JPA WORKERS COMPENSATION
PROGRAM
RECOMMENDATION
Staff recommend that the Council approve the proposed Resolution consenting to join the Pooled Liability Assurance Network (PLAN) JPA Workers Compensation Program.
BACKGROUND
At its October 15, City Council meeting, the council adopted a resolution to dissolve the San Mateo County Cities Insurance Group Joint Powers Authority (the “Cities Group”) This JPA was formed to allow its Member Agencies to pool resources to fund and administer their workers’ compensation programs.
After receiving a withdrawal notice from the City of Foster City in November 2024, four of the five other Member Agencies also submitted withdrawal notices prior to the January 1, 2025 deadline. Unlike Foster City, however, those Member Agencies indicated that they issued their notices in order to reserve their right to withdraw from the Cities Group but had not yet determined whether they intended to withdraw as of July 1, 2025. It was during this time that the Cities Group continued to operate and studied the future viability of the Cities Group. Foster City represented a larger share of the claims handled by the Cities Group and was now viewed as less attractive on the reinsurance market.
It was recommended that each Member Agency conduct its own due diligence to determine where it might take its claims should the Cities Group dissolve. The Board held several discussions in the following months about the future of the Cities Group and the prospect of dissolving the Group.
Plan JPA Workers Compensation Program Staff Report
November 5, 2025
With the termination of Foster City’s membership from the JPA August 1, 2025, the remaining members of the Cities Group included the City of San Carlos, the City of Half Moon Bay, the City of Dublin, the Town of Atherton, and the Town of Hillsborough. It was determined that an orderly dissolution of the Cities Group was the preferable method of transitioning the Member Agencies out of the Cities Group, rather than having each Member Agency individually withdraw.
That resolution directed Cities Group staff to create and present to the Board a dissolution plan under which the Cities Group would cease providing claims administration and all other benefit services on behalf of the Member Agencies on or before December 31, 2025.
ANALYSIS
During the past several months Town staff performed due diligence in researching potential alternatives for its Workers’ Compensation Joint Powers Authority (JPA) program. Staff evaluated three potential programs that included Bay Cities JPA, PLAN JPA, and CJPIA. In researching the various programs staff took into consideration costs and proximity of the underlying JPA’s.
The Town previously assessed membership in CJPIA several years ago and found their program to be considerably more expensive. In addition, with headquarters located in Southern California, their resources are more limited in Northern California. During the dissolution discussions with Cities Group staff performed a comparative review and application to both the Bay Cities JPA and PLAN JPA. Staff found that both organizations offer similar coverage structures and pricing for various cities located in the Bay Area. There are refined differences between them.
Bay Cities currently has 16 members, which requires a substantially higher self-insured retention minimum of $150,000 per claim. Meaning the member agency is responsible for the first $150,000 of each claim before coverage begins. Within this model an agency incurs additional claimsrelated expenses in addition to the premium of which can significantly increase total costs of the workers’ compensation program. Whereas PLAN JPA offers a much lower retention level of $10,000 per claim. Staff believe that PLAN JPA would be a better fit given the Town’s average of three to seven active claims at any given time and allows for annual assessments to be similar to what the Town was contributing to the Cities Group.
Another difference is that the Town would be a voting member within the PLAN JPA. With Bay Cities since the Town is not part of their liability program, the Town would be a Class B Member.
This means that a B member of BCJPIA maintains all the same rights and privileges of a Class A member, except that a Class B member is entitled to an advisory vote on matters solely concerning the programs in which they participate. In this case, the Town would have an advisory vote on any items solely concerning the Workers’ Compensation program.
Within the PLAN JPA the Town is already part of their general liability and property insurance programs. Staff believe that consolidating both the general liability and workers’ compensation programs under the same JPA offers operational advantages as this produces a more coordinated package approach to risk management. This allows the Town to identify trends, align safety measures, and implement effective prevention strategies between the programs.
Plan JPA Workers Compensation Program Staff Report
November 5, 2025
PLAN JPA is an established joint powers insurance authority consisting of 28 members cities in the Bay Area. As mentioned above the Town is already a member of the PLAN JPA for risk management insurance pooling programs including general and property liability, auto liability, cyber security and employment liability. On June 26, 2025, the PLAN JPA Board of Directors approved the formation of the workers’ compensation program effective January 1, 2026, allowing for a strategic synergy for the Town as this aligns with our Cities Group end date of coverage. The formation of the worker’s compensation program completes the insurance offerings of the PLAN JPA. Based on this evaluation, staff recommend pursuing membership with PLAN JPA.
Municipalities Opting Membership
Currently four cities are joining the initial Workers’ Compensation program as of January 1, 2026.
There is anticipation that other agencies will be joining the program in July 2026. PLAN JPA offers a cost effective and comprehensive package solution for the Town’s needs through competitive premium that includes claims administration, excess insurance coverage, and safety risk mitigation services.
The PLAN JPA calls for agencies with public safety departments to have a low Self Insured Retention amount - $10,000 per claim. Since we are joining as of January 1, 2026, with the minimum $10,000 SIR amount, this includes a half year assessment cost of $208,294. With an SIR of $150,000, the half year assessment would be $107,633. PLAN JPA offers reliable premium with an SIR range from ($10K, $25K, $50K, $100K $150K) and an 85% confidence level on costs. A higher confidence level provides a greater likelihood that actual costs will fall within the projected estimate. This reduces the risk of underbudgeting program costs. Estimated costs for a full fiscal year in PLAN JPA are estimated at $416,588. The table below summarizes the estimated annual costs of the two options beginning July 1, 2026.
Workers’ Compensation Program PLAN JPA Bay Cities JPA
Claims Premium $416,588 $616,218
Self-Insured Retention (SIR) per claim -minimum $10,000 $150,000 Excess Insurance Included Included
Claims Expense Included Included
Safety Program/Consulting Services Included Included
Total $416,588 $616,218
As the PLAN JPA program grows it is predicted to breed stability. The Town is joining the Workers’ Compensation program as of January 1, 2026. Three other former members of the Cities Group JPA are also joining and they include Hillsborough, Half Moon Bay, and San Carlos. The PLAN JPA has twenty-eight (28) members within its general liability program. There are currently twelve (12) members that submitted applications to join the Workers’ Compensation program. The earliest most of the members can join is July 1, 2026. The growth of the PLAN JPA Workers’ Compensation Program will assist in spreading risk across multiple agencies, stabilizing costs, and protect against large unpredicted claims. The Town’s familiarity with PLAN JPA operations within the existing liability program allows for a smooth transition and Plan JPA Workers Compensation Program Staff Report
November 5, 2025
consolidation of insurance programs under the same JPA umbrella. PLAN JPA currently provides the best coverage program for the Town. The administrator will work with the Cities Group on the transfer of all of its past and current claims through December 31, 2025 and become the Town’s workers’ compensation program provider beginning January 1, 2026. Currently the Cities Group JPA will handle claims up to December 31, 2025, and then each City of the JPA would take all their existing claims with them to their new JPA. The Town currently has twelve open claims with a total liability of approximately $340,000.
CONCLUSION
Staff requests that the Council approve the proposed resolution for membership attached here as Attachment 1, which will consent the Town to join the PLAN JPA Workers’ compensation program and authorize the City Manager to execute the necessary agreements on behalf of the Town to join the PLAN JPA Workers’ Compensation Program.
FISCAL IMPACT
The overall fiscal impact on joining a new coverage program would include possible slight increase in yearly assessment premiums and access options to individual SIRs. Due to the Town’s diligence in building up its Workers’ Compensation Fund over the years, there is a healthy fund balance for transition from the Cities Group to a new JPA if there is a requirement for the establishment of an equity reserve.
GOAL ALIGNMENT
Goal A- Maintain Fiscal Responsibility
PUBLIC NOTICE
Public notification was achieved by posting the agenda, with this agenda item being listed, at least 72 hours prior to the meeting in print and electronically. Information about the project is also disseminated via the Town’s electronic News Flash and Atherton Online. There are approximately 1,200 subscribers to the Town’s electronic News Flash publications. Subscribers include residents as well as stakeholders – to include, but be not limited to, media outlets, school districts, Menlo Park Fire District, service provides (water, power, and sewer), and regional elected officials.
ATTACHMENT
1.Proposed Resolution Consenting to joining the PLAN JPA Workers’ Compensation Program.
2.Master Program Document for PLAN JPA Pooled Workers’ Compensation Program