Cal. Ed. Code § 1274

Current through the 2022 Legislative Session.
Section 1274 - Establishment of fund or funds for losses and payments

The county superintendent of schools may establish a fund or funds for losses, and payments, including, but not limited to, property of the county superintendent of schools, any liability, and workers' compensation, in the county treasury for the purpose of covering the deductible amount under deductible types of insurance policies, losses or payments arising from self-insurance programs, or losses or payments due to noninsured perils. In the fund or funds shall be placed such sums, to be provided in the budget of the county superintendent of schools, as will create an amount which, together with investments made from the fund or funds, will be sufficient in the judgment of the county superintendent of schools to protect the county superintendent of schools from those losses or to provide for payments on the deductible amount under deductible types of insurance policies, losses or payments arising from self-insurance programs, or losses or payments due to noninsured perils. Nothing in this section shall be construed as prohibiting the county superintendent of schools from providing protection against those losses or liability for the payment of claims partly by means of the fund or funds and partly by means of insurance written by acceptable insurers.

The fund or funds shall be considered as separate and apart from all other funds of the county superintendent of schools, and the balance therein shall not be considered as being part of the working cash of the county superintendent of schools in compiling annual budgets.

Warrants may be drawn on, or transfers made from, the fund or funds so created only to reimburse or indemnify the county superintendent of schools for losses as herein specified, and for the payment of claims, administrative costs, related services, and to provide for deductible insurance amounts and purchase of excess insurance. The warrants or transfers shall be within the purpose of the fund or funds as established by the county superintendent of schools.

The cash placed in the fund or funds may be invested and reinvested by the county treasurer, with the advice and consent of the county superintendent of schools, in securities which are legal investments for surplus county funds in this state. The income derived from the investments, together with interest earned on uninvested funds, shall be considered revenue of and be deposited in the fund. The cost of contracts or services authorized by this section are appropriate charges against the respective fund.

The county superintendent of schools may contract for investigative, administrative, and claims adjustment services relating to claims. The contract may provide that the contracting firm may reject, settle, compromise, and approve claims against the county superintendent of schools, its officers or employees, within those limits and for those amounts as the county superintendent of schools may specify, and may provide that the contracting firm may execute and issue checks in payment of those claims, which checks shall be payable only from a trust account which may be established by the county superintendent of schools. Funds in the trust account established by the county superintendent of schools pursuant to the provisions of this section shall not exceed a sum sufficient as determined by the superintendent to provide for the settlement of claims for a 30-day period. The rejection or settlement and approval of a claim by the contracting firm in accordance with the terms of the contract shall have the same effect as would the rejection or settlement and approval of the claim by the county superintendent of schools. The contract may also provide that the contracting firm may employ legal counsel, subject to those terms and limitations as the county superintendent of schools may prescribe, to advise the contracting firm concerning the legality and advisability of rejecting, settling, compromising, and paying claims referred to the contracting firm by the county superintendent of schools for investigation and adjustment, or to represent the superintendent in litigation concerning the claims. The compensation and expenses of the attorney for services rendered to the county superintendent of schools shall be an appropriate charge against the appropriate fund.

The contract provided for in this section may contain any other terms and conditions the county superintendent of schools may consider necessary or desirable to effectuate the superintendent's self-insured programs.

In lieu of, or in addition to, contracting for the services described in this section, the county superintendent of schools may authorize an employee or employees to perform any or all of the services and functions which the county superintendent of schools may contract for under the provisions of this section.

As used in this section, "firm" includes a person, corporation, or other legal entity.

A county superintendent of schools may participate in, or administer, insurance for one or more school or community college districts pursuant to this section, and Section 81602.

Ca. Educ. Code § 1274

Amended by Stats 2010 ch 89 (AB 2081),s 2, eff. 1/1/2011.