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Executive Staff Report

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									July 14, 2009


TO:             WSTIP Board of Directors

FROM:           Al Hatten, Executive Director; Jerry Spears, Deputy Director; and
                Tracey Christianson, Member Services Manager

SUBJECT:        Executive Staff Report – July 2009


2009 INSURANCE PLACEMENT / 2010 RENEWALS
Staff is in the process of collecting underwriting data for the actuary. Initial indications from the market
are a potential 10% increase based on the hardening market environment. WSTIP was successful in our
renewal discussions last year to secure a rate guarantee for the $8 million in excess of $4 million layer
from One Beacon. Because GEM’s rates are loss driven, and due to our unfortunate loss history in that
layer, we may see our rate increase 8 - 11% in that layer. GEM provides the coverage of $2 million in
excess of $2 million. The real wild card is the layer of $1 million in excess of $1 million with a $500,000
aggregate corridor from MARKEL. We could see the rate increased excess of 10% but it’s leveraged on
how they see our long ranged relationship. It should make for interesting negotiations.

The Actuary has been asked to provide indications to the current structure of a $1 million self-insured
retention with a $500,000 aggregate corridor. We will ask if there are any indications to surcharge any
mode based on loss experience.

GOVERNMENTAL ENTITIES MUTUAL, INC (GEM)
The next meeting is July 21-25, in Minneapolis. The dates will include a seminar of coverage
comparisons, a regular board meeting, the annual meeting including the elections of officers, and a
NAGeP meeting. Tentatively, the agenda will include an executive session on Board assessment
process, criteria used to select potential Board members, eligibility requirements for the Board secretary,
and succession planning.

GEM’s annual meeting will follow the Board meeting and officer elections will take place. Tentatively, I
have been put on the slate as the recommendation of the election committee for board chair.

PUBLIC RECORDS REQUEST FOR TRANSIT VIDEO
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The last meeting of the coalition was June 15 at Pierce Transit. Another meeting of the group is
currently being scheduled by WSTA.

PROPERTY LIABILITY ADVISORY BOARD (PLAB)
Public hearings were held on July 8 and 9 in Ephrata and July 13 and 14 in Tukwila. The proposed
revisions to WAC 82.60 have been through legal review and the regulator has officially published the
proposed changes. Staff attended both meetings and testified in support. A review of the proposed
WAC’s are provided under Tab 11.

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On a side note, six pool directors have floated an idea to create a new entity by Interlocal Agreement for
the purpose of sharing resources and contracted services (such as actuarial services, claims review). It
was also suggested we could use this vehicle for lobbyist services. As this is just in the preliminary
stages, we’ll keep the communication open and see what we can all agree too and the criteria for
participation.

WSTA ROADEO
The Roadeo Steering Committee met in Cle Elum on Thursday to hammer out the details of the 2009
Public Transportation Roadeo. Pierce Transit has agreed to serve as host and WSTIP has agreed to
continue sponsorship for this year’s event. The Committee has discussed numerous strategies to reduce
expenses in an effort to allow this year’s event to be free of registration fees. Changes include
condensing the Roadeo events schedule to build in travel time, hosting the banquet in the late afternoon
at the transit facility instead of a banquet hall, securing volunteers to help prepare and service at the
awards banquet, and soliciting local employees to host competitors at their homes to avoid lodging
expenses. Here are the 2009 State Roadeo details to date:

Event:      Washington State Public Transportation Roadeo
Dates:      August 29-30, 2009 (Saturday-Sunday)
Location: Pierce Transit in Lakewood, Washington
Reduced Schedule:
Saturday afternoon
        12:00 p.m.     Competitors’ Meeting and Course Walk Through
        1:00 p.m.      Course Practice and Pre-trip Inspection and Wheelchair Securement Competition
Sunday
        9:00 a.m.      Course Competition, Uniform Inspection and Competitors’ Pictures
        11:30 a.m.     Simplified lunch (sub sandwiches, salad, chips)
         3:00 p.m.     Late Afternoon Awards Banquet at Pierce Transit

INTEGRATED RISK MANAGEMENT
This item will be reported on under a separate tab and include an update on staff activities, the IRM
Benchmark Subcommittee, and the driver record monitoring project, and the camera subcommittee.

MISCELLANEOUS MEMBER SERVICES

Training Coalition – The Training Coalition goes quiet in the summer months of July and August and
picks back up in September with the Supervisor’s School.

UPCOMING AUTHORIZED CONFERENCES
If you are interested in any of the following conferences and would like to attend or find out more
information, please contact any of the WSTIP staff for assistance. The Executive Committee authorizes
the following WSTIP reimbursable trustee development courses: If you would like the Executive
Committee to consider other conference possibilities, please submit your interest directly to the Board
Chair for consideration and approval.

Conferences and Training Events of Interest to Board Members
August 2009: 2 – 5 – ARMTech Conference – LaJolla, CA *
              Web site: www.armtech.com
August 2009 3 – 5 – AGRIP Institute for Management & Leadership – Burlington, VT
              (Pool Senior Staff focus- Not recommended for trustees)

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October 2009: 1 – 3 – GEM Business Meeting – Concord, NH
              Web site: www.gemre.com
October       2009: 19 – 21 AGRIP Governance Conference – Seattle, WA
              Web site: www.agrip.org

*The August 2009 ARMTech Conference in LaJolla, California is highly recommended.

CLAIMS/FINANCES AND INFORMATION TECHNOLOGY
WSTIP currently has 307 open claims. Twenty-six claims are in litigation status. Total case reserves for
these 307 files are $5,859,533. For loss year 2008, subrogation totals are $461,093. All these
subrogation monies are returned to the members when recovered by staff. For 2009, we have collected
$103,272 so far. Given that Pierce Transit is a full member now, we are incorporating 2009 Pierce
Transit liability claims data into the monthly RiskMaster report. This will include their claims counts,
reserves and paid claims.

Everett Transit had a left hand turn fatality bus/motorcycle accident in March 2007. A $5 million Claim for
Damages was filed by the estranged wife of the deceased a few of months ago. We retained defense
counsel for this matter. It appears mediation will occur in August to resolve this case. Everett Transit was
also involved in a serious chain reaction rear-ender collision in October 2006 involving six vehicles where
the Everett bus was the last vehicle in the chain. Fifteen claims developed from this accident against
Everett Transit. We have resolved eleven of the fifteen claims. We will attempt to resolve three of the
remaining four over the next few months via mediation and/or negotiation.

Ben Franklin Transit had a serious rollover vanpool accident in January 2008. It was a single vehicle
accident. This event has seven claimants including the driver. One passenger was at Harborview in
Seattle for six weeks. We are closely monitoring this file. Four of the seven passengers have retained
the same attorney to represent their interests. We have retained defense counsel and an outside
adjuster to help resolve this matter. We settled two claims at mediation in December. We were unable to
settle a third claim at mediation in Spokane. There is a wide discrepancy on value between WSTIP and
the plaintiff in this case. This plaintiff/passenger filed a lawsuit on this matter but recently returned to
work. There is one other passenger from this accident that is still treating because of this accident. He is
represented by a Kennewick attorney. We do not expect resolution on this one for at least a year. He
has not filed a Claim for Damages or a lawsuit yet.

We have received a $3.4 million demand from the most seriously injured passenger in the Ben Franklin
Vanpool accident. We are currently evaluating it. We work towards mediation in January 2010.

Spokane Transit has a 2005 case that appears headed for trial in September of this year. It is an auto
rear-ender case. There is wide discrepancy between WSTIP and the plaintiff on the value and extent of
her injuries sustained from the impact. We recently had a telephone attorney peer review on this case.
Jim Plaster participated in the peer review. We have mediation scheduled for August in Spokane, but it
appears unlikely it will settle. Spokane Transit also has a November 2008 bus/pedestrian accident where
a bus struck a pedestrian in the crosswalk in downtown Spokane. The pedestrian sustained a skull
fracture from the accident. The pedestrian has retained an attorney for this accident. WSTIP has
retained defense counsel as well. No claim or lawsuit has been filed on this matter yet.

Community Transit had a bus/person on scooter collision in April. The person on the scooter was 86
years old, a retired pediatrician and missionary. The scooter driver died from his injuries sustained from
the collision. The accident occurred in the crosswalk near a senior center in Stanwood. The entire event
is captured on the bus camera system. The family of the deceased has retained an attorney. WSTIP has

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retained an attorney and adjuster for this event. We will look for opportunities to resolve this matter later
in the year, perhaps early next year.

Finances – Over the next two months staff will start work on 2010 budget development, strategic
financial forecasting for the next 5 years and liability reinsurance renewals. Staff will be asking members
to provide updated exposure data for the 2010 budget development and the strategic financial forecasting
                     th
model by August 15 .

Cyber Liability – Several WSTIP members in the Puget Sound area are involved in a “smart card”
project. Smart card is a regional fare collection program which enables customers to use one fare card
on multiple systems throughout the four county Central Puget Sound area. Smart card fare collection
technology will be used to allow linked trips between transit, ferries and rail and to significantly expand
each agency’s strategic fare policy capabilities. The participants in this project are looking for cyber
liability coverage to protect themselves from this new and emerging exposure. The WSTIP Broker did a
detailed coverage analysis for those members in this program recently. WSTIP is planning to do a cyber
liability assessment at Pierce Transit shortly.

Google Transit - Staff has also arranged for a Consultant to be available for those small and medium
member’s that wish to upload their scheduling data to Google Transit. Please contact Andrea Powell if
interested. It appears the WSDOT version of Google Transit, “travel options,” will no longer be funded by
the State effective July 1. WSDOT staff has approached WSTIP/WSTA about moving the data in “travel
options” to Google Transit via the WSTIP IT Infrastructure. There may be state funds (a potential grant)
available to facilitate the transition and continue the project in a Google conduit and staff are exploring the
potential for a partnership.

WSTIP Web Site – As previously reported, WSTIP is working to redeploy our public website utilizing a
SharePoint platform. The new public site is up internally and externally. The Training Coalition piece was
developed, and Anna and Andrea met in early June to rework the Board event registration pieces. They
have developed web forms that will support our goal of directing more WSTIP operational functions
through a web browser. Andrea provided the Board with an update at the June Quarterly meeting.

Pierce Transit - Staff has started the transition process for Pierce Transit’s full membership January 1,
2010. Staff expects this to be a smooth but very involved process that includes meetings, negotiation and
coordination over the next six months. The Pierce Transit Claims Audit is scheduled for some time in the
next two weeks.




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