Woodland’s annual municipal-liability, insurance premium rose from $418,000 to $640,000 for the upcoming fiscal year — a $222,000 increase — due a single incident involving 44 year-old Ricardo Abrahams —  whose welfare was allegedly of concern to four Woodland police officers involved in his death.

This basic proportion of premium increase for the city will remain in effect for three years — adding a total of about $666,000 in red ink — to Woodland’s several years of budget deficits.

Two years ago, Woodland’s annual liability-insurance premium was only about $300,000.

___  Abrahams Died From Physical Compression & Suffocation  ___

Abrahams died of — “positional asphyxia” — in the opinion of the Yolo County Coroner, while under physical restraint by these four police officers — although there was apparently no legal basis for his detention or arrest.

Wrongful-death litigation against the City of Woodland and these four individual police officers was initiated on February 11, 2009, by Sacramento-based attorney Johnny Griffin, on behalf of Abrahams’ parents, Rosemary and Cecil Abrahams of Davis.

Abrahams reportedly was a law student and an intern in the office of Yolo County District Attorney, Jeff Reisig.

___  Abrahams Not Accused of Criminal Behavior  ___

Abrahams was a client of Safe Harbor Crisis House, a mental health provider, located in the 500 block of Kentucky Avenue. During or soon after his visit to this facility on May 28, 2008, someone notified police about their — apparently: non-criminal — concerns regarding Abrahams.

Yolo Sun’s request for comments by the (at least in this instance — ironically named) Safe Harbor Crisis House have so far been declined, although this facility doesn’t appear to be a target of litigation by Abrahams’ parents.

No allegation of unlawful conduct by Abrahams has been made during the course of local police investigation, as well as an investigation by the state Attorney General — which also found that no criminal violations occurred — on the part of these four officers.

These four police, dispatched for such a — “welfare check” — type of situation encountered Abrahams nearby this facility.

When Abrahams (armed only with a pencil, according to some accounts of this incident) displayed behavior which might reasonably be expected of persons with mental instability / illness — and failed to obey some police instructions — he was shot with four separate taser weapons, ultimately being physically subdued and restrained by these four police officers — who suffocated him in the process.

___  JPA Insurer for Local Governmental Entities  ___

Yolo County’s various jurisdictional entities (cities and special districts, etc., as well as the County) aggregate their resources for insurance — liability protection — within a separate legal entity, generically known as a Joint Powers Authority: Yolo County Public Agency Risk Management Insurance Authority (YCPARMIA).

YCPARMIA is a component of a broader network and program of self-insurance for public entities, with seventy to eighty members throughout Northern California (California Joint Powers Risk Management Authority), for use on occasions of legal judgments exceeding $500,000 for a single event.

Woodland’s liability coverage under this expanded, excess-risk umbrella system of liability management, is $40 million for any single event.

___  Claims History Component in Insurance Premium Formula  ___

Jeff Tonks, CEO of YCPARMIA, describes that — “there’s an element of experience” — within the formula for determining premium amounts within the various jurisdictions participating in this self-insurance system. “Too adverse a [litigation] history, has an adverse affect on [that member’s] premium.”

Tonks expressed that the incident involving the death of Abrahams was the factor responsible for the huge jump in Woodland’s liability premium.

“A three-year experience modifier” exists within this allocation formula for setting members’ premiums, relates Tonks. Just as a person’s driving history (accidents, citations, various factors influencing liability exposure, etc.) is a determinative factor in rating their automobile insurance — a city’s — “adverse litigation and claims component” — will for this period of time elevate its proportion of fiscal burden within this self-insurance system.

“Good risk practices by member agencies, good claims practices by [YCMARMIA], and [fostering] safety” in all facets of agency exposure to liability are the keys to success for such multi-jurisdictional systems, indicates Tonks.

“One or two bad claims can greatly skew an entity’s relative position [within YCPARMIA].”

___  Death Cases Cause Sharp Rises in Insurance Premiums  ___

“Where you have a death case, [  ] the fluctuating dynamic of this history element becomes very negative,” Tonks emphasizes.

Tonks predicts that the recent death of Luis Gutierrez during a mid-day encounter with four members of the Gang Suppression Unit of the Yolo County Sheriff’s Office will cause a similar — very significant elevation — of the County’s share of next year’s premium allocation.

Yolo County’s current (annual) liability premium through YCPARMIA is $949,404, so the incipient lawsuit in the Gutierrez matter will surely boost the County’s annual insurance bill — to way over a million dollars.

If it rises roughly in proportion to Woodland’s recent increase, the County’s share would exceed $1.5 million for fiscal year 2010-11.

Such an increase would stay in place for three years (until 2014), connected to the adverse-history, modifier component of YCPARMIA’s risk management formula.

Woodland’s elevated proportion of this JPA premium-pool will likewise be maintained for three years — resulting in a total loss to the City of about $666,000. Also, this year’s premium was diminished by $60,000 because of an expenditure of reserves by YCPARMIA.

More or less, the city is paying-off more than the — full amount — of the local liability cap ($500,000) — with its increased premiums over three years — simply based on such a significant damage claim being litigated.

Unless, of course, a successful damage claim exceeds $40 million — these elevated premiums are the extent of the city’s basic loss. While, various other expenses related to such extraordinary circumstances surely expand to some extent the overall cost.

However — a multi-million dollar legal judgment against Woodland — for the wrongful death of Ricardo Abrahams — would likely have various political and financial consequences.

___  Comparisons With Other YCPARMIA Jurisdictions ___

For comparison, Tonks mentioned that the City of Davis has a less adverse, recent “history element,” which is directly reflected in its — much lower — $336,061 liability premium for the current fiscal year.

A few years ago (as noted), Woodland’s annual premium was in this range.

West Sacramento’s present share of the YCPARMIA premium-pool for liability coverage is $561,545. As noted, the county’s share is now $949,404.

YCPARMIA also covers workers compensation claims on behalf of its members. Woodland’s premium for this insurance coverage also went up for fiscal year 2009-10, from $471,334 to $544,000.

___  YCPARMIA Reserves Lower Woodland’s Premium  ___

Some liability claims will be lost, while some will be won. Overall, YCPARMIA is in pretty good (stable) shape.

In fact, YCPARMIA  just expended some “excess, surplus” reserve funds, “credited against [current and] future premiums of the member agencies,” says Tonks, who added that such help was fairly “common” within the authority’s operations — whenever reserves are sufficient and the members could use a fiscal hand — as in the current economic conditions / budget crises.

This YCPARMIA (reserve) supplement for 2009-10 meant about $60,000 to Woodland, reducing its premium from a projected (and budgeted) $700,000 — down to $640,000.

Tonks reports that the total amount of premiums paid by members of YCPARMIA is presently at the same level that it was in 1995 — indicating a well-managed operation.

“How would you feel if your overall debts were the same as [fifteen years ago]?,” he proudly expressed.

___  Budget Savings From YCPARMIA Help Already Soaked Up  ___

Inquiry to the City Manager regarding budgetary savings created by the difference between projected and actual expenses for liability and workers compensation insurance — roughly $216,000 — resulted in Mark Deven’s (regularly) timely response:

“Any savings realized due to premiums being lower than originally estimated could be used to offset the [anticipated] deficit in the benefits internal service fund — which receives its funding based on a flat-rate allocation to departments per employee. We were concerned that [this] would be under-budgeted,” because of the number of voluntary early retirements provoked in an effort to navigate the city’s budget.

Deven also indicated that it would be prudent to also begin to build a small amount of reserves in the city’s (related) liability account — that was totally flattened as an early remedy to fiscal woes.

Thus, whatever savings accrued from YCPARMIA’s limited help lowering Woodland’s sky-rocketing liability premium was instantly soaked-up by the City’s (ongoing) budget crisis.