Item No. 13.
TO:HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM:OFFICE OF THE CITY MANAGER
BY:JAMES MCQUEEN, DIRECTOR OF HUMAN RESOURCES
DATE:MAY 26, 2026
SUBJECT:ADOPTION OF RESOLUTION AUTHORIZING THE CITY OF DOWNEY TO WITHDRAW
FROM THE INDEPENDENT CITIES RISK MANAGEMENT AUTHORITY
EXECUTIVE SUMMARY
The City Council will consider adopting a resolution authorizing the City to provide notice of intent to withdraw from the Independent Cities Risk Management Authority (ICRMA) which currently provides pooled insurance services to the City.
RECOMMENDATION
That the City Council:
Adopt Resolution No. 26-8353, authorizing the City to provide notice of the City's intent to withdraw from the Independent Cities Risk Management Authority.
BACKGROUND
The City of Downey, like many municipalities in California, is a member of a joint powers authority which provides a combination of self- insurance, pooled coverage and other risk management products and programs to member agencies. The City is currently a member of the Independent Cities Risk Management Authority (ICRMA). ICRMA currently provides services to a total of twelve Southern California cities.
ANALYSIS
Over recent years, the cost of coverage has continued to increase while the pool has also decreased in the total number of member agencies. As a result, these rising costs have to be spread among the remaining membership.
Recently, two additional member agencies have also issued notice of their intent to withdraw in the upcoming program year. There is also a possibility that other agencies will soon be following suit, further decreasing the membership. The primary factor these other agencies are electing to pursue other options appears to be due to increasing costs. As the membership continues to decrease the continued benefit of pooling is reduced for the remaining member agencies.
In an effort to retain membership and streamline operations ICRMA will conduct a comprehensive review of current structure and member costs to be completed in the next 6 months. This review is being undertaken with the intent to restructure operations in an effort to retain current membership and minimize increasing costs which may have significant impacts to remaining members. In an effort to preserve the City's rights during this process, staff is recommending the filing of this notice of intent to with draw from the pool. ICRMA bylaws require the adoption of a resolution indicating an agency's intent to withdraw to be filed by July 1st in order to be effective at the start of the following program year. As such, the City is required to adopt this notice of intent to withdraw by July 1, 2026, in order to preserve the City's rights to withdraw by July 1, 2027, if determined to be in the City's best interest.
Following the adoption of this resolution, staff is committed to working with ICRMA to ensure the conditions are met for the City's continued membership. Additionally staff will research other potential coverage options to determine if continued membership with ICRMA is in the City's best interest. The City last issued a notice of intent to withdraw in November of 2017 in order to review other potential coverage options. The following January the City elected to rescind this notice and stay with the ICRMA. In addition to the potential structural changes to the pool, this additional review is timely as it has been over 8 years since the City last completed a review of these services. If continued membership is determined to be in the best interest of the City, the appropriate withdrawal notice shall be provided by the December 1, 2026 deadline as authorized by this resolution.
CITY COUNCIL PRIORITIES
Fiscal Responsibility
FISCAL IMPACT
There is no fiscal impact.
Attachments
Attachment A: Resolution No. 26-8353 - Notice of Intent to Withdraw ICRMA
RESOLUTION NO. 26-8353
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DOWNEY
PROVIDING NOTICE OF THE CITY’S INTENT TO WITHDRAW FROM THE
INDEPENDENT CITIES RISK MANAGEMENT AUTHORITY
WHEREAS, the Independent Cities Risk Management Authority (ICRMA) provides a variety of pooled insurance products to its member cities; and
WHEREAS, the City of Downey is currently an ICRMA Governing Board Member and participates in various ICRMA insurance programs; and
WHEREAS, the Joint Exercise of Powers Agreement for Insurance and Risk Management Purposes and the bylaws of the ICRMA establish the guidelines for participation in the insurance and other related programs offered by ICRMA and further provide the process for withdrawal from the ICRMA; and
WHEREAS, the ICRMA program bylaws require a member to provide specific notification of intent to withdraw by the adoption of a governing body resolution; and
WHEREAS, the City is currently performing a due diligence analysis of its current method for providing insurance and related programs; and
WHEREAS, the City wishes to preserve its right to withdraw from ICRMA should the current analysis show that withdrawal would be advantageous to the City; and
WHEREAS, the City is required to provide notice of its intent to withdraw from ICRMA by July 1, 2026 if it wishes to withdraw effective July 1, 2027; and
WHEREAS, the City may elect to rescind this notice to withdraw by December 1, 2026, should the analysis show that withdrawal would not be advantageous to the City.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF DOWNEY DOES HEREBY RESOLVE AS FOLLOWS:
SECTION 1. The City of Downey hereby provides written notice of its intent to withdraw membership from ICRMA effective July 1, 2027.
SECTION 2. The City Manager shall be authorized to rescind this notice of intent to withdraw by December 1, 2026, if it is determined that withdrawal from ICRMA would not be in the best interest of the City as determined by further analysis.
SECTION 3. The City Clerk shall certify to the adoption of this Resolution.
APPROVED AND ADOPTED this 26th day of May, 2026.
_________________________________
CLAUDIA FROMETA, Mayor
RESOLUTION NO. 26-8353
PAGE 2
ATTEST:
______________________________
MARIA ALICIA DUARTE, CMC
City Clerk
APPROVED AS TO FORM:
JOHN M. FUNK
City Attorney
I HEREBY CERTIFY that the foregoing Resolution was adopted by the City Council of the City of Downey at a regular meeting held on the 26th day of May, 2026, by the following vote, to wit:
AYES: Council Members:
NOES: Council Members:
ABSENT: Council Members:
ABSTAIN: Council Members:
MARIA ALICIA DUARTE, CMC
City Clerk