Cotati City Council
Agenda Staff Report
Item type: REGULAR AGENDA (ACTION)
To: City Council
Subject: JOINING COALITION TO SUPPORT TORT REFORM
Date: June 23, 2026
Written by: Damien O'Bid, City Manager
Recommendation
It is recommended that the City Council authorize the City joining Cal Cities, CIRA and a coalition of California public agencies advocating for tort reform legislation aimed at reducing escalating public agency liability costs and preserving taxpayer resources for essential public services and infrastructure.
Background
Lawsuits and liability claims against California public entities are skyrocketing, resulting in a rapidly increasing redirection of public funds from services and infrastructure to paying insurance premiums and settlements. According to the California Association of Joint Powers Authorities (CAJAPA), payments for large claims over $1 million have nearly quadrupled since 2018-19 and are projected to triple again by 2026-27.
As a result of this unsustainable increase in costs and diversion of taxpayer funds, a coalition of public agencies is forming to petition the State Legislature to introduce legislation to fix this problem.
Analysis/Discussion
The City of Cotati (City), belongs to a self-insurance risk pool called the California Intergovernmental Risk Authority (CIRA). CIRA is a non-profit joint powers authority that represents over 60 cities and special districts in California. Recently, CIRA updated their strategic plan, with nearly all members prioritizing tort reform as the highest priority for CIRA to address. This was borne primarily out of a collective frustration with exponentially increasing insurance rates, which are a direct result of the current statutory framework in California that encourages expensive settlements to avoid litigation and face the potential of uncapped multi- million dollar jury verdicts that public agencies must pay, even if found only 1% responsible.
This has resulted in an unsustainable re-direction of taxpayer funds away from services and infrastructure to fund settlements and plaintiffs' attorneys. Plaintiffs’ attorneys are conservatively estimated to now receive over $500 million annually in taxpayer funds in California.
In addition to CIRA, the League of California Cities (Cal Cities) has also joined a coalition urging the State Legislature to pass tort reform legislation. Many associations and individual agencies have already signed on, with their logos appearing on the letterhead. The legislative process is moving quickly, so Cal Cities is encouraging interested cities to respond with an email confirming interest, as well as the city logo. The most up-to-date version of the coalition letter is attached.
Financial Considerations
As described in prior budget study sessions, the City has experienced a large increase in insurance premiums, primarily due to the aforementioned market dynamics. Over the past 10 years, the City’s $11M General Fund has experienced a dramatic increase in insurance costs from around $100k per year to now over $800,000 per year. This means that the City now has at least $700,000 less funding each year for services to the community or infrastructure, such as roads or parks. This same story is playing out in other communities across the state.
Environmental Issues
Where it can be determined with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA review.
This general rule can be applied to activities which could be subject to the CEQA process, but which logic dictates should not be subject to CEQA review. Therefore, based on the information provided above, the proposed action is exempt from CEQA pursuant to Section 14.03.021 of the CEQA Guidelines in that there is no possibility that the activity may have a significant impact on the environment.