City Council Agenda Report
Meeting Date: December 2, 2025
From: Brian Saeki, City Administrator
Department: City Administration
Submitted by: Lilia Hernandez, Assistant to the City Administrator Subject
Report on Services Agreement with AEGIS Insurance Services, Inc. Approved by the City Administrator
Recommendation
Receive and file a report on the Property Loss Control Services Agreement with AEGIS Insurance Services, Inc., as approved by the City Administrator pursuant to Vernon Municipal Code Sections 3.32.110(B)(2) and 3.32.110(B)(3) for property and machinery loss control services for a total not-to-exceed $10,900.
Background
As of July 1, 2025 the City secured property and machinery insurance for the Malburg Generating Station (MGS) from AEGIS Insurance Services, Inc. (AEGIS). AEGIS requires a comprehensive property and machinery risk assessment to evaluate the operation and maintenance of critical MGS equipment. The assessment may be completed by a third party; however, this is not ideal as it can result in denied coverage if deemed inaccurate or deficient. As the insurer, AEGIS has a vested interest in ensuring the assessment is accurate and thorough. AEGIS has staff capable of conducting the necessary assessment and is well regarded in the industry. Consistent with pricing from the previous year, the cost quoted by AEGIS for the assessment was $10,900.
On November 4, 2025, the City Administrator approved a Property Loss Control Services Agreement (Agreement) with AEGIS for the needed assessment pursuant to Section
3.32.110(B)(2) of the Vernon Municipal Code (VMC). The VMC authorizes the City Administrator to exempt contracts from the competitive selection process when the best interests of the City are served by a direct award of the contract. The Agreement with AEGIS was awarded without a competitive process to avoid potential third-party liability and issues with coverage as well as on their ability to perform the necessary property and machinery risk assessment at a competitive price. The report to City Council is provided as required pursuant to VMC Section 3.32.110(B)(3).
Fiscal Impact
The fiscal impact was $10,900. Sufficient funds are available in the Fiscal Year 2025-26 Public Utilities Fund Budget, Insurance – Property/Crime, Account No. 055-050-586-520035.
Attachments
None.