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Ordinance No. 905ORDINANCE, No. 2oS AN ORDINANCE PROVIDING FOR THE CONSTITUTION OF A CITY INSURANCE ADVISORY COMMITTEE FOR THE CITY OF BAYTOWN, TEXAS. SUBJECT TO THE ANNUAL REVIEW AND GENERAL DIRECTION OF THE GOVERNMENT OF THE CITY OF BAYTOWN; PRESCRIB- ING MEMBERSHIP QUALIFICATIONS AND REQUIRE- MENTS; PROVIDING FOR GENERAL PROCEDURE OF ADVISORY COMMITTEE OPERATIONS; EFFECTING INITIAL ORGANIZATION OF THE ADVISORY COMMTTEE; PROVIDING A REPEALING CLAUSE; PROVIDING A SEV- ERABILITY CLAUSE; AND PROVIDING FOR THE EFFECT- IVE DATE THEREOF. WHEREAS. the City Council of the City of Baytown hereby finds and declares that it is in the public interest and necessary for the advancement of the general welfare, comfort and convenience of the City and its inhabitants that an insurance pool be constituted immediately to insure the City of Baytown against casualty and liability losses; NOW, THEREFORE: BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN: Section 1: Creation: There is hereby constituted the CITY OF BAY. TOWN INSURANCE ADVISORY COMMITTEE, hereinafter called ADVISORY COMMITTEE. The purpose of the Advisory Committee shall be to recommend to the City Manager or his designee and arrange for insurance coverage for the City of Baytown on the terms and conditions herein stated: snail: Section 2: Qualifications. All members of the Advisory Committee A. (1) Be recording agents and represent stock companies directly with a rating of A -AAAA, or better, as indi- cated by Best Insurance Guide and said members must have authority to issue and countersign; policies in the companies which they represent. A. (2) As used herein the term "agent" shall mean a natural person or persons. The benefits hereunder shall accrue on an agency basin, and an agent shall be eligible to benefits under one agency only. Not more than one per- son employed directly or indirectly in an agency shall participate in the operation of the ADVISORY COMMITTEE or receive benefits thereunder except a licensed partner or regularly employed solicitor who may represent the agent. B. (1) Have a proprietary interest in and actively managed and operated a general fire and casualty insurance business as a licensed recording agent in the City of Baytown for the five consecutive years immediately preceding each member's application for membership in the ADVISORY COMMITTEE. Agents in newly annexed areas may qualify if they meet this require- ment within the newly annexed area either prior to or after annexation. Agents participating at the time of adoption of this ordinance shall not be excluded by this five year requirement, or under section 2 $ (3). B. (2) All persons, at time of application for membership and thereafter, who become members of the ADVISORY COM- MITTEE must maintain a business office separate and apart from any residential rooms or lodging. B. (3) Members of the ADVISORY COMMITTEE shall not engage, in full -time employment in any occupation outside the in- surance industry, except combined real estate business. Any agent who is supervised or controlled by or connected or associated with a bank, mortgage loan company, sav- ings and loan association or a managing general agency owned or controlled by or connected or associated with a bank, mortgage loan company or savings and loan as socia -' tion shall not be eligible due to possible conflict of interest. C. Carry Errors and Omissions Insurance Coverage with limit of at least $50, 000.00. D. Reside within the corporate limits of the City of Baytown and own a fee interest in real property within the corporate limits of the City of Baytown. Section 3: Composition: 3. (A) The ADVISORY COMMITTEE shall consist of all said agents complying with the Section 2 Qualifications and who file ap- plication in the office of the City Clerk of the City of Baytown on or before June' 1 of each year. Application forms shall be furnished by the City Clerk during regular business hours under such regulations as she may prescribe. Section 4: Management and Procedure: 4. (A) The ADVISORY COMMITTEE shall meet on the first Mon- day after the 15th, day of June of each year at 2:00 P.M. at the City Hail of the City of Baytown, unless such Monday falls on a City legal holiday, in which event the meeting shall be on the business day next following. 4. (B) The City Manager shall review all applications for ;member- ship and approve all applications found in compliance with the terms of this ordinance. 4. (C) The executive committee of three (3) shall be elected from among the membership approved for the year ensuing. Each member present shall be entitled to one vote and an affirma- tive majority of those present and voting shall constitute the election of the executive committee. The chairman of the executive committee shall be elected by the Advisory Com- mittee as a whole and in the same manner. -2- 4. (D) The chairman of the executive committee shall appoint such sub- committees as are needed for proper study and recommendations to the City Manager on matters of in- surance. He shall act as chairman of all advisory com- mittee meetings, serve as liaison between City Manager and Advisory Committee and perform such other duties as may be assigned by the Advisory Committee. Section 5: Attendance: S. (A) All members will be'required to attend the initial meet- ing each year as well as all other meetings called by the EXECUTIVE COMMITTEE CHAIRMAN, except as provided in Section 5 (B). Notice of meetings called by the EXECU- TIVE COMMITTEE CHAIRMAN shall be given to all mem- bers by such means and at such times as the ADVISORY COMMITTEE may prescribe. 5. (B) Any member having called- meetings absences totalling more than 207o of the total number of called meetings within one calendar year prior to any time of calculation of the number of said absences shall automatically forfeit all mem- ber rights for the following year and such members shall not be permitted participation in that following year. Section 6: Policy Assignment Procedure: 6. (A) Each year, at a time designated by the EXECUTIVE COM- MITTEE CHAIRMAN and sufficiently early to assure con- tinuity of complete insurance protection for the City, all members shall draw for the right to write a one -third (1/3) share of the total fire schedule. The fire insurance policy shall be written for a three year period at rates developed by the fire and allied lines sub- committee subject to the specifications of the City of Bay- town as determined by its Council or designated officers and in conformance with the Insurance Code of Texas. To instigate this procedure, drawing will be made for two broken terms policies of one and two years and one three year policy. Agents holding policies then in force shall not be eligible for any fire schedule drawing until all their existing fire policies have expired. 6. (B) All other casualty insurance policies and all City Officer fi- delity bonds may be written by the ADVISORY COMMITTEE CHAIRMAN, subject to the specifications of the City and in conformance with applicable State law. 6. (C) The chairman of the executive committee shall appoint the standing sub- committees chaired separately by the other two members of the executive committee for the purpose of study- ing and making recommendations as to placement of required insurance coverages. (1) Fire and allied lines sub- committee: It shall be the duty of this sub - committee to inspect all City properties for the purpose of proper rating and re- commendation as to placement of coverage. -3- (2) Casualty and other insurance sub - committee. It shall be the duty of this sub - committee to inspect all equipment and gather rating data necessary to making recommendations for placement of all other insurance coverages required. b. (D) The City Manager shall furnish to the executive committee at least ninety (90) days prior to policy renewal dates: (1) A schedule of all properties on which fire and extended coverage insurance is desired. Such schedule shall contain the current replacement values on each item to be insured. (2) A complete schedule of all vehicles and other exposures to be insured. (3) All other information, including but not confined to em- ployee data and any other information needed for properly rating each risk. b. (E) In the event, due to unfavorable loss experience, a particular coverage or policy cannot be renewed in the same company carrying the expiring coverage and the appropriate sub -com- mittee cannot recommend a renewal market, the executive conunittee may deviate from the assignment procedure, as necessary and promptly advise the City Manager of its actions. Section 7: Commissions: All earned commissions on all policies, . excluding contingent commissions, shall be distributed equally among all the ADVISORY COMMITTEE members at such time and in such manner as the AD- VISORY COMMITTEE may determine, except the agent writing the fleet cover- age shall receive 35% of the commission on such coverage written by him and shall not participate in the distribution of the remaining commission on that cover- age. Section 8: Existing Policies: Existing policies and all contracts con - netted therewith, shall expire at normal schedules, unless renewed hereunder, or otherwise cancelled pursuant to the terms of said policies and contracts. Section 9: Repeal,: All ordinances, resolutions, rules or regulations in force when this ordinance becomes effective and which are in conflict herewith or inconsistent herewith are hereby repealed, insofar as said ordinances, reso- lutions, rules or regulations are inconsistent with or in conflict with this ordin- ance. Section 10: Severabilit : If any word, phrase, clause, sentence, para- graph, section or part of this ordinance shall be held by any court of competent -4- Jurisdiction to be invalid or unconstitutional it shall not affect the validity or enforceability of any other word, phrase, clause, sentence, paragraph, section or part of this ordinance. Section 11: Effective Date: That this ordinance shall take effect from and after the date of its passage by a majority of the City Council of the City of Baytown. INTRODUCED, READ and PASSED by a majority of the City Council of the City of Baytown, on this 15th clay of January, 1968 . ATTEST: Edna Oliver, City Clerk -5- Seaborn Cravey, May