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R-03-02RESOLUTION NO. R -03 -02 AUTHORIZING MEMBERSHIP IN THE INTERGOVERNMENTAL PERSONNEL BENEFIT COOPERATIVE AND THE EXECUTION OF INTERGOVERMENTAL AGREEMENTS WITH THE DEERFIELD PARK DISTRICT AND DEERFIELD PUBLIC LIBRARY WHEREAS, Section 10 of Article VII of the Illinois Constitution of• 1 970 authorizes units of local government to contract or otherwise associate among themselves in any manner not prohibited by law or by ordinance; and WHEREAS, the "Intergovernmental Cooperation Act," 5 IL.CS 220/1 et sect. authorizes units of local government to exercise any power or powers, privileges or authority which may be exercised by a unit of local government individually, to be exercised and enjoyed jointly with any other unit of local government in the State; i.nd WHEREAS, units of local government within Illinois have found it increasingly expensive to provide health and III(; IIISLIrance benefits to their officers and employees; and WHEREAS, a large number of local government entities, having Undertaken a series of' studies to determine the feasibility of entering into an Intergovernmental Personnel Benefits Cooperative (11'13C ") for the purpose of administering some or all of the personnel benefits programs offered by its member units of local government to their respective officers and employees, created and have successfully operated such a Cooperative; and WHEREAS, the Village of Deerfield has studied membership in the 11'13C as a means of'providing health and life insurance benefits to its employees in a cost - effective manner; and and WHEREAS, membership has been extended to the Village of Deerfield to participate in the 11'13C; WHEREAS, the President and Board of'TrUSleeS of the Village of Deerfield have determined that it is in the best interest of the Village: of Deerfield to join this organization to participate with other municipalities in benefits ofpooling health insurance for its employees; and WHEREAS, to continue its relationship with the Deerfield Public Library and the Deerfield Park District to provide health insurance benefits for their eligible employees under the aegis of the Village of Deerfield it is necessary to enter into agreements with those organizations designating them as listed entities of the Village in the I1313C. NOW, THEREFORE, BE IT RESOLVED BY THE PRESIDENT AND BOARD OF TRUSTEES OF THE VILLAGE OF DEERFIELD, LAKE AND COOK COUNTIES, ILLINOIS, in the exercise of' its home rule powers, that membership in the Intergovernmental Personnel 13enefits Cooperative is hereby accepted, commencing May 1, 2003 until.june 30, 2005. BE IT FURTHER RESOLVED, that the contract and by -laws of the IPBC, attached hereto and made a part hereof, are hereby adopted and approved. BE IT FURTHER RESOLVED, that the intergovernmental agreements with the Deerfield Park District and Deerfield Library District are hereby approved and the Mayor is authorized and directed to sign said agreements. BE IT FURTHER RESOLVED, that Robert Fialkowski, Director of Finance, is hereby designated as the delegate, and Ellasion Phillips, Assistant Finance Director, is hereby designated as the alternate delegate for the Village. AD01 "I,IF.D this 21st day of' January , 2003. AYES: Kayne;..Ragona, Rosenthal, Seiden, NAYS: None (0) A13Svr,i-r: None (0) ABSTAIN: None (0) APPROVED this 21st day of' ATTEST: Village Clerk Swanson, Wylie (6) SECOND CONSOLIDATED AMENDMENT TO - CONTRACT AND BY -LAWS INTERGOVERNMENTAL PERSONNEL BENEFIT COOPERATIVE I N D E X Page No. 1 ARTICLE I. Definitions and Purpose. 1 Definitions. 3 Purpose. 5 ARTICLE II. Powers and Duties. 6 ARTICLE III. Participation. 7 ARTICLE IV. Commencement of the 1996 Term of the COOPERATIVE. 8 ARTICLE V. Board of Directors. - 13 ARTICLE VI. Board of Directors Meetings. 15 ARTICLE VII. Cooperative Officers. 17 ARTICLE VIII. Finances. 24 ARTICLE IX. Plan of Benefits, HMOs and Reduction In Coverage. 29 ARTICLE X. Excess Insurance. 30 ARTICLE XI. Obligations of Members. 33 ARTICLE XII. Liability of Board of Directors or Offices. 34 ARTICLE XIII. Additional Insurance. 35 ARTICLE XIV. Disputes Over Coverage. 36 ARTICLE XV. Contractual Obligation. 37 ARTICLE XVI. Expulsion of Members. 39 ARTICLE XVII. Withdrawal of a Member-and Continuation or Termination of the COOPERATIVE. Drafted by: ANCEL, GLINK, DIAMOND, BUSH, DICIANNI & ROLEK P.C. SHD:DAR \ C:\My Document s\I PBC \96ADOPT15- 1-- 7- 18- 01.IDX.wpd \ 1379623.000 9 /5 /96-- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment SECOND CONSOLIDATED AMENDMENT TO THE CONTRACT AND BY -LAWS INTERGOVERNMENTAL PERSONNEL BENEFIT COOPERATIVE ARTICLE I. Definitions and Purpose. DEFINITIONS: As used in this agreement, the following terms shall have the meaning hereinafter set out: ADMINISTRATIVE FUND - A fund of monies established by the MEMBERS of the Intergovernmental Personnel Benefit Cooperative to pay for the joint administration of the personnel non- salary benefit programs offered by each MEMBER to its employ- ees and officers and turned over for administration to the COOPERATIVE. ADMINISTRATOR - An independent contractor of the COOPERATIVE employed to administer the personnel benefit programs of the various MEMBERS of the COOPERATIVE. BENEFIT POOL - A fund of monies established by the MEMBERS of the Intergovernmental Personnel Benefit Cooperative to fund certain benefits granted by the individual MEMBERS to their respective officers and employees and to purchase excess, aggregate, or other insurance. BENEFITS - Non - salary payments made to employees or officers, including but not limited to payments or reimbursements of expenses arising out of an illness or an accident and life insurance proceeds. The units of local government which 1 9/5/96 -- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment participate in the COOPERATIVE have determined not to purchase insurance coverage for benefit payments below certain high limits but rather to rely upon their pooled financial capabil- ities to pay benefits within the financial obligations of the COOPERATIVE and to purchase some insurance to protect against catastrophic and certain other benefit claims. COOPERATIVE - The Intergovernmental Personnel Benefit Coopera- tive established pursuant to the Constitution and the statutes of this State by this intergovernmental agreement. HMO POOL - A fund of monies established by the MEMBERS of the Intergovernmental Personnel Benefit Cooperative to fund certain benefits granted by the individual MEMBERS to their respective officers and employees relating to health mainte- nance organizations. INDEMNITY CASH FLOW ACCOUNT - A fund of monies established by the MEMBERS of the Intergovernmental Personnel Benefit Cooperative to fund needed cash flow in the Benefit Pool. The Board of Directors shall establish, from time -to -time, the funding requirements from the MEMBERS to generally provide at least two (2) months of estimated funding for the Benefit Pool. LISTED ENTITIES - Governmental bodies, quasi governmental bodies and non - profit public service entities listed by a MEMBER as having their employees and officers under a benefit 2 i 9/5/96 -- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment program which will be administered along with that of a MEMBER by the COOPERATIVE. MEMBERS - The units of local government or intergovernmental agencies established pursuant to an intergovernmental agree- ment composed of units of local government which initially or later enter into this intergovernmental contract for the benefit of their employees and officers along with the employ- ees and officers of other listed entities. Whenever in this agreement the phrase "units of local government, municipality" or similar phrase is used, it shall also refer to any inter- governmental agency established pursuant to an intergov- ernmental agreement composed of units of local government. TERMINAL RESERVES - A fund of monies retained by the Intergov- ernmental Personnel Benefit Cooperative on behalf of MEMBERS whose fund balances are in excess of all financial require- ments for that MEMBER. PURPOSE: The Intergovernmental Personnel Benefit Cooperative is a cooperative entity voluntarily established by contracting units of local government as are permitted by Article VII, Section 10 of the 1970 Constitution of the State of Illinois, and the Intergovernmen- tal Cooperation Act and other provisions of law to jointly administer some or all of the personnel benefit programs offered by its MEMBERS to their officers and employees and the officers and employees of other governmental, quasi - governmental and non - profit 3 1 ' 9 /5 /96-- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment public service entities with which some or all MEMBERS have separately arranged to list as if such officers and employees were employed by the MEMBER. To the extent provided for in this Contract and By -Laws, and as approved by the Board of Directors , the Intergovernmental Personnel Benefit Cooperative shall provide benefit coverage to the officers or employees of its MEMBERS. The Intergovernmental Personnel Benefit Cooperative shall also carry out such claim reduction and educational programs as shall be authorized by its Board of Directors. The creation of the various funds and pools established in this Contract and By -Laws are not intended by the parties to constitute the transaction of an insurance business within the State of Illinois. The intent of the parties is to separately establish benefit programs and to utilize the Intergov- ernmental Personnel Benefit Cooperative to achieve reduced costs of administration by providing similar services to all MEMBERS of the entity and to require MEMBERS to pay for the costs of such benefits or to share such costs in the manner from time -to -time established by the Board of Directors. 4 � Q f 9 /5 /96-- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment ARTICLE II. Powers and Duties. The powers of the COOPERATIVE to perform and accomplish the purposes set forth above, within the budgetary limits and proce- dures set forth in these By -Laws, shall be the following: (a) To employ agents, employees and independent contractors, (b) To lease real property and to purchase or lease equip- ment, machinery, or personal property necessary for the carrying out of the purpose of the COOPERATIVE, (c) To carry out educational and other programs relating to health, accident and other claims reductions, (d) To cause the creation of, see to the collection of funds for the administration of the COOPERATIVE (Administrative Fund) and to create the Benefit Pool, (e) To purchase such individual excess, aggregate, group life and other types of insurance approved by the Board of Directors, (f) Solely within the budgetary limits established by the MEMBERS to carry out such other activities as are necessarily implied or required to carry out the purposes of the COOPERATIVE specified in Article I or the specific powers enumerated in Article II. 5 y 9 /S /96-- ADOPTION COPY 9/12/00 -- amendment 7/18/01 -- amendment ARTICLE III. Participation The membership of the COOPERATIVE shall consist of those MEMBERS and previously approved listed entities which were MEMBERS of the COOPERATIVE on May 1, 1996, and by May 1, 1996 elected to continue as MEMBERS into the next three -year cycle. Listed entities are other governmental, quasi - governmental and non - profit public service entities which MEMBERS have chosen to include within their membership in the COOPERATIVE. Such listing fulfills a public purpose in that such listed entities have so few employees and officers that they could not bear the risk inherent in offering such benefit programs on their own. In other cases, the MEMBER itself has so few employees that it requires the participation of such other listed entities for the same reason. The MEMBER which lists entities shall, however, be the sole MEMBER of the COOPERA- TIVE and shall be responsible for all costs and duties of member- ship provided herein. The MEMBER may make such arrangement as is desired with the listed entities regarding the manner of payment, sharing of risks and duration of such arrangement. Such arrange- ment is not a part of this Contract and By -Laws. New MEMBERS and their listed entities and the listing of additional entities by existing MEMBERS shall be added to the COOPERATIVE only after a favorable two - thirds (2/3) vote of the entire membership of the Board of Directors and subject to the payment of such sums and under such conditions as the Board shall in each case or from time- to-time establish. O 9 /5 /96-- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment D c ARTICLE IV. Commencement of the 1996 Term of the COOPERATIVE. If by May 1, 1996, MEMBERS of the COOPERATIVE, on that date, which provide their respective benefit plans to at least 750 officers and employees have by corporate ordinance or resolution elected to continue as MEMBERS into the next three -year cycle, then the COOPERATIVE shall continue in existence and the terms of this Second Consolidated Amendment to the Contract and By -Laws of the Intergovernmental Personnel Benefit Cooperative shall take effect commencing on July 1, 1996. If this Second Consolidated Amendment is approved, the terms of the First Consolidated Amendment, as they exist on June 30, 1996, shall be applicable to any event which occurred prior to June 30, 1996, and which is not otherwise dealt with in the Second Consolidated Amendment. 7 9 /5 /96-- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment ARTICLE V. Board of Directors. (a) There is hereby established a Board of Directors of the COOPERATIVE. Each MEMBER unit of local government shall, by majority vote of its governing board, elect one (1) person to represent that body on the Board of Directors. The MEMBER may also select an alternate representative to serve when the initial representative is unable to carry out his duties. The person and alternate selected need not be an elected official of the MEMBER. During the last quarter of the fiscal year, including the fiscal year which ends on June 30, 1996, or at its first meeting of each subsequent fiscal year, the Board of Director shall elect from the Board one (1) person to serve as Chairman of the Board and one (1) person to serve as Vice Chairman of the Board for terms of one (1) or two (2) fiscal years,. The Board of Directors may from time -to- time establish other officers of the Board and may elect a person from the Board to serve in any of such offices. The Board may fill any vacancies which may occur in such offices until the end of the term. (b) The Board of Directors shall determine the general policy of the COOPERATIVE which policy shall be followed by all officers, agents, employees and independent contractors employed by the COOPERATIVE. It shall have the responsi- bility for (1) Hiring of COOPERATIVE officers, agents, 9/5/96 -- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment non - clerical employees and independent contractors, (2) Setting of compensation for all persons, firms and corporations employed by the COOPERATIVE, (3) Setting of fidelity bonding requirements for employees or other persons, (4) Approval of amendments to the By -Laws, (5) Approval of the acceptance of new MEMBERS and listed entities, (6) Approval of educational and other programs relating to claim reduction, (7) Approval of monthly and supplementary payments to the Administrative Fund and the Benefit Insurance Pool, including that portion of the cost of excess or other types of insurance attributable to each MEMBER, (8) Any other matters not assigned to another committee, officer, independent contractor, or agent. (c) Each MEMBER shall be entitled to one (1) vote on the Board of Directors. Such vote may be cast only by the designated representative of the MEMBER or in the Director's absence by an alternate selected by the MEMBER in the same manner as specified for the selection of the principal representative. No proxy votes or absentee votes shall be permitted, but in the absence of a quorum, not more than two (2) Directors may participate in a meeting by telephonic means. If more than two (2) Directors request to participate by telephonic means, a random method shall be used by the person who will be I J 9 /5 /96-- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment presiding at the meeting to choose the Directors to be selected. voting shall be conducted by voice vote unless one (1) or more MEMBERS of the Board of Directors shall request a roll call vote; provided, however, that any vote to authorize the expenditure of Funds or which requires a greater than a majority vote for passage, shall be by roll call. (d) The representative selected by the MEMBER shall serve for a one fiscal year term commencing at the beginning of each fiscal year and until his successor has been selected. The representative chosen by the MEMBER may be removed by the majority vote of the corporate authorities of the MEMBER during the period of this term. In the event that a vacancy occurs in the representative or alternate representative selected by the corporate authorities of a MEMBER, that body shall appoint a successor. The failure of a MEMBER to select a represen- tative or his failure to participate shall not affect the responsibilities or duties of a MEMBER under this contract. (e) The Board of Directors may establish rules governing its own conduct and procedure not inconsistent with the By- Laws. (f) A quorum shall consist of a majority of the MEMBERS of the Board of Directors. Except as provided in Subsection 10 9/5/96 -- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment (g) herein, or elsewhere in these By -Laws, a simple majority of a quorum shall be sufficient to pass upon all matters. (g) A greater vote than a majority of a quorum shall be required to approve the following matters: (i) Such matters as the Board of Directors shall estab- lish within its rules as requiring for passage a vote greater than a majority of a quorum; provided, however, that such a rule can only be established by a greater than majority vote at least equal to the greater than majority percentage within the proposed rule, (ii) The admission of a new MEMBER or a listed entity and the expulsion of a MEMBER shall require the two - thirds (2/3) vote of the entire membership of the Board of Directors, (iii) Any amendment of these By -Laws except as provided in Subsection (iv) below, shall require the two- thirds (2/3) vote of the entire membership of the Board of Directors, (iv) The amendment of these By -Laws to require mandatory membership in the COOPERATIVE for more than a three -year term shall require the favorable vote of the governing board of each MEMBER evidenced by a resolution or ordinance. 11 9 /S /96-- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment (v) The adoption of procedures regarding administration of an application for benefits shall require the two - thirds (2/3) vote of the entire membership of the Board of Directors. (vi) The approval of payments of all kinds into the Benefit Pool and the allocation of those payments among MEMBERS shall require the vote of sixty percent (600) of the entire membership of the Board of Directors. (h) No one serving on the Board of Directors shall receive any salary or other payment from the COOPERATIVE and any salary, compensation, payment or expenses for such representative, shall be paid by each MEMBER separate from this Contract. Provided, however, that in the event the person chosen as Treasurer is a member of the Board of Directors, that person may receive such compensation as is established from time -to -time by the Board of Directors. In addition, the Chairman of the Board, Treasurer and such other officers as maybe selected from time -to -time may submit to the Board of Directors for their approval reimbursement of expenses incurred in the pursuit of their position as officers of the COOPERATIVE. The reimbursement for such expenses shall include amounts advanced on behalf of the COOPERATIVE either by the officer himself or by a MEMBER of the COOPERATIVE. 12 9/5/96 -- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment t ARTICLE VI. Board of Directors Meetings. (a) Regular meetings of the Board of Directors shall be held at least four (4) times a year. The dates of regular meetings of the Board shall be established at the beginning of each fiscal year. Any item of business may be considered at a regular meeting. At least two (2) meetings must be held during the first half of the fiscal year and at least two (2) meetings must be held during the second half of the fiscal year. Special meetings of the Board of Directors may be called by its Chairman, or by any two (2) Directors. Ten (10) days written notice of regular or special meetings shall be given to the official representatives of each MEMBER government and an agenda specifying the subject of any special meeting shall accompany such notice. Business conducted at special meetings shall be limited to those items speci- fied in the agenda. (b) The time, date and location of regular and special meetings of the Board of Directors shall be determined by the Chairman of the Board of Directors or by the conven- ing authority. (c) To the extent not contrary to these By -Laws, and except as modified by the Board of Directors, Roberts Rules of Order, latest edition, shall govern all meetings of the Board of Directors. Minutes of all regular and special 13 7 kv 9 /5 /96-- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment meetings of the Board of Directors shall be sent to all MEMBERS of the Board of Directors. 14 � U f 9/5/96 -- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment ARTICLE VII. Cooperative Officers. (a) In addition to the Chairman and Vice Chairman, the officers of the COOPERATIVE shall consist of a Treasurer and such other offices as are established from time -to- time by the Board of Directors. All officers shall be appointed by the Board of Directors. (b) The Treasurer shall: 1. Have charge and custody of and be responsible for all funds and securities of the COOPERATIVE; re- ceive and give all receipts for monies due and payable to the COOPERATIVE from any source whatso- ever; deposit all such monies in the name of the COOPERATIVE in such banks, savings and loan associ- ations or other depositories as shall be selected by the Board of Directors; keep the financial re- cords of the COOPERATIVE and invest the funds of the COOPERATIVE as are not immediately required in such securities as the Board of Directors shall specifically or generally select from time -to -time. Provided, however, that all investments of COOPERA- TIVE funds shall be made only in those securities which may be purchased by Illinois non -home rule communities under the statutory provisions of Illinois law. 2. In general, perform all the duties incident to the office of Treasurer and such other duties as from time -to -time may be assigned to him by the Benefit Administrator or the Board of Directors. (c) In the absence of the Treasurer, or in the event of the inability or refusal of such officers to act, the Chairman of the Board of Directors may temporarily perform the duties of the Treasurer and, when so acting, shall have all of the powers of and be subject to all of the restrictions upon the Treasurer. A new Treasurer 15 9 /5 /96-- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment shall be selected at the next regular or special meeting of the Board of Directors. (d) The COOPERATIVE shall purchase a blanket fidelity bond in an amount to be established by the Board of Directors to assure the fidelity of all officers, directors, and employees of the COOPERATIVE who shall have the authority to receive or authorize by their signature or order the payment of COOPERATIVE funds. Additional fidelity and similar coverages may be procured by the COOPERATIVE from time -to -time. (e) The Board may select a financial institution to carry out some or all of the functions which would otherwise be assigned to a Treasurer and may select a management company or agent to carry out some or all of the func- tions which would otherwise be assigned to an Adminis- trator. Eu• V r 9/5/96 -- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment ARTICLE VIII. Finances. A. Runout Claims -- Pre -July 1, 1996. The administration and financing of the claims and the handling of the final accounting of a MEMBER, which leaves the COOPERATIVE in 1996 shall take place in accordance with the Contract and By -Laws in effect on January 1,1996. For MEMBERS which remain in the COOPERATIVE after July, 1996, a final accounting of the funds owed to or owing from the MEMBERS from the operations of the COOPERATIVE to July 1, 1996, shall be accomplished so that any surpluses or deficits due or owing from the MEMBERS shall be paid in twenty -four (24) monthly payments beginning sixty (60) days after the approval of the audit of the COOPERATIVE for the prior fiscal year. The Board of Directors may make or require interim payments based upon earlier audited figures, but the total payment made or due shall reflect final audit figures for the fiscal year ending June 30, 1996. During the fiscal year which commences July 1, 1996, the Board of Directors may vote to utilize surplus funds of the COOPERATIVE to assist in providing cash flow for operations but all then- current and immediately past MEMBERS shall be responsible for the payment of any sums due the COOPERATIVE promptly upon a demand made in accordance with Article XVII. If any MEMBER should be delin- quent in such payments then, during the period that such funds are outstanding, payments to MEMBERS owed funds shall be proportionally reduced rather than requiring other MEMBERS to contribute addition- 17 9/5/96 -- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment al funds on behalf of the delinquent MEMBER, or former MEMBER. MEMBERS receiving payments may elect to utilize such funds to pay current or future obligations to the COOPERATIVE or ask that they be held in a terminal reserve fund. Amounts placed in a terminal reserve fund may be withdrawn by a MEMBER in accordance with Article VIII -G. B. Administrative Fund. The cost of the administration of the COOPERATIVE shall be borne by each of its MEMBERS in direct proportion to the number of employees and officers of the MEMBER and listed entities whose benefit programs are to be administered by the COOPERATIVE as compared to the total number of such persons served by the COOPERA- TIVE. Whenever payments to the Administrative Fund shall be based upon an estimate, the MEMBER shall promptly receive a refund or pay a deficiency when final figures become available. The Administra- tive Fund shall pay all of the administrative costs of the COOPERATIVE. C. The Benefit Pool. Payments into the Benefit Pool will be developed and adminis- tered in the following manner: 1. Before the start of each fiscal year, the Adminis- trator will determine on the basis of financial data the amount of total payments from all MEMBERS necessary to fund anticipated benefit payments and the cost of excess or other insurance. EU:3 V r 9 /5 /96-- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment 2. The Administrator will also recommend how this total amount of anticipated expenses should be divided among the MEMBERS. The charges to be made to the MEMBERS shall be determined by a vote of the Board of Directors which shall, in establishing such sums due, treat all similarly situated MEMBERS in an equal manner. Such a vote must receive the concurrence of at least sixty percent (60 %) of the MEMBERS 3. The Board of Directors may, each fiscal year, choose an allocation of the payments into the Benefit Pool whereby some or all of the costs are divided among the MEMBERS based upon general in- creases or decreases in the total costs of the COOPERATIVE without regard to the claims made against individual MEMBERS or it may elect to grant debits or credits based upon the individual plans offered by the MEMBERS or the level of claims. Debits or credits may be expressed through the use of a banding formula. Such a vote must receive the concurrence of at least sixty percent (600) of the MEMBERS. 4. In the event that the Board of Directors shall fail to approve the charges or allocations by the requi- site vote, the charges and allocations for next year of any three -year cycle shall, until and unless modified, be based upon the prior year's allocations with charges increased by ten percent (10 %) . 5. The Administrator, upon approval of the Board of Directors, will purchase individual excess insur- ance. The Administrator shall also purchase such other insurance coverage as may be approved by the Board of Directors. 6. Without regard to any other provision contained within this Article VIII, the Board of Directors may establish charges to be paid by the MEMBERS for life insurance benefits to be based upon total pooling of the experience of all MEMBERS with each MEMBER paying the same cost per employee for such life insurance coverage. The time at which a determination regarding the amounts due for such life insurance coverage and the manner in which such amounts shall be paid shall be the same as that established for other payments into the Bene- 19 9 /5 /96-- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment fit Pool. The Board of Directors may also estab- lish a program to provide dental benefits to MEM- BERS which wish such coverage. D. Indemnity Cash Flow Account. Commencing July 1, 1996, the Board of Directors shall establish an indemnity cash flow account. Each MEMBER shall make payments into that account equal to some percentage set by the Board of Directors of the payments that MEMBER has made into the Benefit Pool. The Board of Directors shall determine the manner in which each MEMBER'S obligation to make payments into the indemnity cash flow account is established to assure that an adequate balance for the payment of claims remains in that account at all times. The Board of Directors may establish a method whereby automatic withdrawals from Terminal Reserves are utilized to fund deficits in the indemnity cash flow account. The Board of Directors shall determine whether the indemnity cash flow account shall be treated as a single fund which can be utilized for the payment of the claims of any MEMBER or whether each MEMBER shall be obligated to maintain its own individual account. If separate accounts are maintained, MEMBERS may be individually required to make up deficiencies in their accounts. The establishment of payments into this account must receive the concurrence of at least sixty percent (60 %) of the MEMBERS. E. General Fiscal Matters. The Board of Directors shall provide to the MEMBERS an annual audit of the financial affairs of the COOPERATIVE to be made by a 20 , V c 9/5/96 -- ADOPTION COPY 9 /12 /00-- amendment 7/18/01 -- amendment certified public accountant at the end of each fiscal year in accordance with generally accepted auditing principals. F. Supplementary Payments. If, during any year, the funds on hand in the Benefit Pool, HMO Pool or the Administrative Fund are not sufficient to pay benefits or administrative expenses, the Board of Directors shall require supplementary payments. The increased payments shall be computed utilizing the same method under which payments were made for the year in question and except for payments into the Adminis- trative Fund where payments shall be made by all MEMBERS, they shall only be due from MEMBERS which were entitled to receive benefits from the fund which required Supplementary Payments. If a MEMBER withdraws all employees and officers from a fund where Supplementary Payments are due, a determination shall be made by the Board of Directors as to the amount of Supplementary Payments due from that MEMBER arising from its prior participation in that fund. G. Required Payments. During any fiscal year, a MEMBER shall only be required to make payments into the Benefit Pool and HMO Pool for those officers and employees within those covered classes established at the beginning of the fiscal year who are from time -to -time employed by the MEMBER or its listed entities. Unless the administrative costs of the COOPERATIVE can be proportionally reduced, however, a MEMBER shall be required to make payments into the Administrative Fund for 21 9 /5 /96-- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment at least 500 of the number of covered employees and officers which it (not including its listed entities) employed at the beginning of the fiscal year. H. Terminal Reserves. During any fiscal year, a MEMBER may withdraw from the COOPERATIVE any amount of terminal reserves provided that there shall be deducted from that payment any amounts owed by the MEMBER A -.1 or reasonably anticipated to be owed by the MEMBER to the 000PERA- (7/18/01) TIVE either being then due and payable or estimated to be due based upon tentative figures or preliminary audits, or any other amounts due from the MEMBER to the COOPERATIVE. Within thirty (30) days after a final audit, the amounts then determined to be owed to the COOPERATIVE shall be deducted from the terminal reserves. In the event that there are no sums due to the COOPERATIVE, the MEMBER shall receive payment within thirty (30) days of a written request. If the COOPERATIVE shall have advanced funds on behalf of a MEMBER such that the MEMBER shall be shown to have a deficit balance in its terminal reserves, then, within sixty (60) days after written notice, following the approval of an audit by the Board of Directors, the Members shall be required to pay to the COOPERATIVE at least sufficient funds so as to remove the deficit in its terminal reserves. I. Debit /Credit. The Board of Directors may establish a formula in which MEMBERS may gain credits or suffer debits based upon the manner in 22 , r � 9 /5 /96-- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment which the experience of the MEMBER differs from estimated paid claims. Any debits or credits arising out of a claim year shall be due or be paid within the period of time established by the Board of Directors. 23 9/5/96 -- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment ARTICLE IX. Plan of Benefits, HMOs and Reductions In Coverage. MEMBERS may change the Plan of Benefits provided at any time, but shall notify the Chairman of the Board of the COOPERATIVE and the Administrator at least thirty (30) days prior to the intended effective date of such change; and such change shall be subject to a redetermination on an actuarial basis of the payments due the COOPERATIVE. The Administrator shall make a determination as to the amount of the increased or reduced payment required in light of the change in the Plan of Benefits. If the MEMBER should dispute the amount of the redetermination, a final decision regarding such amount shall be made by the Board of Directors. In the event that the Administrator should determine that the proposed change in the Plan of Benefits provides a level or type of coverage, the cost of which cannot be actuarially determined or which would provide an excessive risk to the COOPERATIVE, or is inconsistent with the aggregate, excess or other insurance purchased by the COOPERATIVE or would otherwise not be in the best interest of the COOPERATIVE, the Administrator shall present that opinion and the reasons supporting that opinion in writing to the MEMBER requesting the change and to the Chairman. The change in the Plan of Benefits shall not come into effect as a change under the COOPERATIVE' S Plan of Benefits unless the decision of the Administrator shall be overturned by the Executive Committee or the Board of Directors. The MEMBER may institute the change, but shall be financially responsible for the administration and payment of such benefits. 24 9 /5 /96-- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment The COOPERATIVE may offer to its MEMBERS participation in an HMO Pool separate from the Benefit Pool to fund the costs of providing HMO services to the officers and employees of the participating MEMBERS. Accounting for funds in this Pool, including surplus or deficit amounts, shall be separate from the BENEFIT POOL. For any fiscal year if the Board of Directors of the COOPERATIVE votes to provide an HMO Pool for the fiscal year, all MEMBERS offering HMO benefits to their officers and employees, and wishing to offer the COOPERATIVE'S HMO Pool, shall only offer the Plan of Benefits of the COOPERATIVE'S HMO Pool. Provided, however, that any officer or employee (holdover employee) who received HMO benefits on July 1, 1994, from an HMO program other than that offered by the COOPERATIVE may, at the option of the MEMBER continue to receive benefits from that HMO. Other than to a holdover employee, no MEMBER offering the COOPERATIVE HMO coverage after July 1, 1994, shall offer an HMO Plan of Benefits for its officers and employees other than the HMO Plan of Benefits offered by the COOPERATIVE. An HMO Plan of Benefits shall mean any plan which provides benefits to partici- pants through a restriction on the doctors who provide services, an absence of substantial deductible or co- payments and an absence of or simplified claim forms. An HMO Plan of Benefits may be offered by the COOPERATIVE either through joint purchase or pooling. The rates for the HMO Plan of Benefits offered by the COOPERATIVE for the specific plans of its MEMBERS shall be 25 9/5/96 -- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment established by the Board of Directors, which shall establish an average annual rate percentage change for the HMO Pool as a whole, and may then, through the use of a banding formula, establish bands of no more than 10 percentage points more or less than the average annual price adjustment for those MEMBERS whose claims experience has been above or below the average. Under two (2) circumstances, the Administrator may recommend that an individual MEMBER or MEMBERS be individually rated. Where the actual paid claims, incurred by a MEMBER during two (2) or more years of a three (3) year cycle, were both in the highest or both in the lowest bands, or where it is discovered that claim history material submitted by a MEMBER was improperly stated, that MEMBER or MEMBERS may be individually rated and may be required to contribute to the HMO Pool a sum no more than 100% greater or lesser than the amount which would be payable had that MEMBER or MEMBERS been rated with the group as a whole. Such individual rating shall carry into another cycle until such time as the paid claims of the MEMBER have declined for a year so that the MEMBER would be entitled to be rated with the group as a whole. If, for any year or years, the Board of Directors should determine that there are surplus funds within the HMO Pool which can be distributed to the MEMBERS without harming the fiscal integrity of the HMO Pool, those surplus funds shall be distributed to all existing and prior MEMBERS of the COOPERATIVE (who validly withdrew) who made contributions into the HMO Pool in the propor- 26 9 /5 /96-- ADOPP.I:ON COP'i /12/00 -- amendment - arienjnlen: 'k1 or tion in which those contributions were made. A determination as to whether surplus funds shall be distributed to the remaining MEMBERS of the COOPERATIVE shall be made from time -to -time by the Board of Directors. If a MEMBER, in accordance with the By -Laws, elects to withdraw from the COOPERATIVE, or if it has no officers or employees who will receive the HMO Plan of Benefits for the next fiscal year, it shall be the obligation of that MEMBER to pay all the claims of its officers and employees for HMO services under the COOPERATIVE performed prior to the commencement of that next fiscal year, but not submitted and processed before the end of that fiscal year. Within sixty (60) days after the approval of the audit of the COOPERATIVE for the prior fiscal year, a final accounting of funds owed or owing shall take place. If a MEMBER which has offered an HMO Plan of Benefits shall have no officers or employees receiving such benefits in a subsequent fiscal year, or if that MEMBER has validly withdrawn from the COOPERATIVE, then that MEMBER shall be entitled to its percentage of any surplus funds within the HMO Pool. The payment of surplus funds or the receipt of amounts otherwise due from the MEMBER shall be carried out in accordance with the provisions of Article XVII. In the event that HMO coverage is no longer offered by the COOPERATIVE, any surplus funds remaining shall, after audit, be 27 /5/96 - A-DOPr ONT COP d /12/00 amendment 7/18/01- amendmenc distributed to the MEMBERS (except for expelled MEMBERS) in the proportion in which they contributed funds to the HMO Pool. If the number of employees or officers of the MEMBERS eligible to receive some portion of the scope of covered benefits should decline or where for some other reason the Administrator is concerned about the ability of a specific fund to cover potential claims, the matter shall be brought to the attention of the.Board of Directors. The Board of Directors may determine that the coverage shall no longer be offered or its scope or amount of coverage shall be prospectively reduced. A decision to make such a reduction shall not become effective for at least sixty (60) days after the vote of the Board. 4)"51,96 A1)O1)'f1.0[J COPT 4 '1 :?,'O 0 - amendment 7/18/01- amcndimen ARTICLE X. Excess Insurance. The COOPERATIVE may purchase excess insurance from a company approved by the Department of Insurance to write such coverage in Illinois. 29 U 9 /5/9G-- HD0PT10N COPY 4 /1.2 /00-- amendmenz: 7 /18 /01-- amendment: ARTICLE XI. Obligations of Members. The obligations of MEMBERS of the COOPERATIVE shall be as follows: (a) To appropriate for, where necessary to levy for and to promptly pay all monthly and supplementary or other payments to the Administrative Fund, the Benefit Pool, A -1 and the HMO Pool at such times and in such amounts as (7/18/01) shall be established by the Board of Directors within the scope of this agreement. Any delinquent payments. shall be paid with a penalty which shall, for the period of non- payment, be equivalent to the prime rate of interest on the date of delinquency charged by the bank in Illinois with the largest assets or the highest interest rate allowed by statute to be paid by an Illinois non - home rule municipality whichever is greater. In the event that the COOPERATIVE shall be required to expend funds for administrative, legal or other costs brought about by the failure of a MEMBER to pay sums owed the COOPERATIVE, such amounts expended shall be added to the sums due the COOPERATIVE and shall be payable by the MEMBER. In the event that a MEMBER of the COOPERATIVE should sue the COOPERATIVE or any of its MEMBERS or officers regarding an interpretation of this Contract and By -Laws, an action taken by the Board of Directors or officers or any other matter arising out of its member- 30 9/5/96 - ADOPTION C7P`; a /12 /00-- amendment: 7;1.3/U1- ameudmen;; ship in the COOPERATIVE, and should not be the prevailing party in that suit, it shall, as part of its contractual obligation to this COOPERATIVE, pay the reasonable attorneys' fees and other costs and expenses expended by the COOPERATIVE in defending against that suit. (b) To select a person to serve on the Board of Directors and to select an alternate representative. (c) To allow the COOPERATIVE reasonable access to all facilities of the MEMBER and all records including but not limited to financial records which relate to the purpose and powers of the COOPERATIVE. (d) To furnish full cooperation with the COOPERATIVE's attorneys, claims adjusters, the Administrator and any agent, employee, officer or independent contractor of the COOPERATIVE relating to the purpose and powers of the COOPERATIVE. (e) To furnish the COOPERATIVE with a copy of revisions to its written benefit program at least thirty (30) days prior to the effective date of such change. (f) To report to the COOPERATIVE as promptly as possible all claims made to it within its benefit program as adminis- tered by the COOPERATIVE. (g) To follow those procedures regarding the administration of and application for benefits adopted by the Board of Directors which do not reduce the level of benefits 31 9/5/96 -- ADOPTION' COPY .. Na /oo - -a. »end. »epic amendment contained within any MEMBER Is individual benefit program. For example, large case management and frequency and amount of claim submissions. The adoption of such procedures shall require the two- thirds (2/3) vote of the entire membership of the Board of Directors. 32 e v . 9/5/96 ADOPTION COPY -1/1. /00 -- amendment: 7,'18/01 amendment ARTICLE XII. Liability of Board of Directors or Officers. The MEMBERS of the Board of Directors or officers of the COOPERATIVE should use ordinary care and reasonable diligence in the exercise of their power and in the performance of their duties hereunder; they shall not be liable for any mistake of judgment or other action made, taken or omitted by them in good faith; nor for any action taken or omitted by any agent, employee or independent contractor selected with reasonable care; nor for loss incurred through investment of COOPERATIVE funds, or failure to invest. No director shall be liable for any action taken or omitted by any other Director. No Director shall be required to give a bond or other security to guarantee the faithful performance of their duties hereunder. The Administrative Fund shall be used to defend and hold harmless any Director or officer for actions taken by the Board or performed by the Director within the scope of his authority. The COOPERATIVE may purchase insurance providing similar coverage for such Directors or officers. 33 9 /5 /96-- ADOPTION COPY /12 /00-- amendm,�n[ 7 /18 /01-- amendment ARTICLE ;III. Additional Insurance. The COOPERATIVE through the distribution of the minutes of the Board of Directors or through other means shall inform all MEMBERS of the scope and amount of excess insurance in force from time -to- time. Membership in the COOPERATIVE shall not preclude any MEMBER from purchasing any excess insurance coverage above those amounts or different from that purchased by the COOPERATIVE. The COOPERA- TIVE shall, where requested, make its facilities available to advise MEMBERS of the types of additional or different employee benefits or excess insurance coverage available to units of local government. The COOPERATIVE may also create and administer programs to pay dental or other claims. All funds for the operation of such programs shall be accounted for separately and the financial obligations arising from such programs shall only be the responsi- bility of MEMBERS which participate. M ),15/96—ADOPTION COPY 4/12/00 -- amendment 7/1.3/01 -- amendment ARTICLE XIV. Disputes Over Coverage. In the event that a MEMBER should dispute whether an employee or officer of the MEMBER or a listed entity is entitled to payments from the Benefit Pool, that MEMBER shall, in writing, direct the COOPERATIVE not to pay any further amounts arising from such claim after the date of the receipt of the written direction. when so directed, the COOPERATIVE shall not pay such claim unless the MEMBER's order is withdrawn. Provided, however, that the MEMBER shall defend and hold harmless the COOPERATIVE against any costs or damages which the COOPERATIVE shall incur in acting on the direction of the MEMBER. In the event that an officer or employee or other person claiming benefits from a MEMBER or the MEMBER itself should contest the decision of the Board of Directors, which declines to pay a benefit in whole or in part, the decision of the Board of Directors shall be final in the absence of fraud. The COOPERATIVE shall have no financial responsibility if a company which provides insurance for benefit claims refuses or is unable to pay such claims. In the absence of action by the Board of Directors to recover such funds from the Company the MEMBER affected may pursue the matter at its expense. 35 9 /5 /00- -'kD0PT10N COPY 4/12/00 -- amendment 7/13/01 -- amendment ARTICLE XV. Contractual Obligation. This document shall constitute a contract among those units of local government which become MEMBERS of the COOPERATIVE. The obligations and responsibilities of the MEMBERS set forth herein including the obligation to take no action inconsistent with this Contract and By -Laws as originally written or validly amended shall remain a continuing obligation and responsibility of the MEMBER. The terms of this contract may be enforced in a court of law either by the COOPERATIVE itself or by any of its MEMBERS. The consider- ation for the duties herewith imposed upon the MEMBERS to take certain actions and to refrain from certain other actions shall be based upon the mutual promises and agreements of the MEMBERS set forth herein and the advantage gained by MEMBERS in anticipated reduction of administrative costs for the processing of personnel benefits. Provided, however, that the financial obligations of a MEMBER are limited to that agreed to herein or such additional obligations as may come about through amendments to these By -Laws. The obligations under this Second Consolidated Amendment shall commence on July 1, 1996. 36 9/ 5 /95-- ADOPTION COPY 12/00 7118101- amendment ARTICLE XVI. Expulsion of Members. By the vote of two - thirds (2/3) of the entire remaining membership of the Board of Directors, any MEMBER may be expelled. Such expulsion, which shall take effect in the manner set out below, may be carried out for one or more of the following reasons: (a) Failure to make any payments due to the COOPERATIVE, (b) Failure to furnish full cooperation with the COOPERATIVE's attorneys, claims adjusters, Administrator and any agent, employee, officer or independent contrac- tor of the COOPERATIVE relating to the purpose and powers of the COOPERATIVE, (c) Failure to carry out any obligation of a MEMBER which impairs the ability of the COOPERATIVE to carry out its purpose and powers. No MEMBER may be expelled except after notice from the COOPERATIVE of the alleged failure along with a reasonable opportunity of not less than fifteen (15) days to cure the alleged failure. The MEMBER, within that 15 day period, may request a hearing before the Board before any decision is made as to whether the expulsion shall take place. The Board shall set the date for a hearing which shall not be less than fifteen (15) days after the expiration of the time to cure has passed. The Board may appoint a hearing officer to conduct such hearing and make a recommendation to the Board based upon findings of fact. If the Board conducts the hearing itself, it may make a decision at the close of the hearing. A decision by 37 • r ' 9 /5 /96-- ADOPTION COPY 4/12/00 amendmenL '7/]9/01- amendment the Board to expel a MEMBER after notice- and hearing and a failure to cure the alleged defect shall be final unless the Board shall be found by a court to have committed a gross abuse of discretion. After expulsion, the former MEMBER shall continue to be fully obligated for any payment to the Administrative Fund and the Benefit Pool which was created during the term of its membership along with any other unfulfilled obligation as if it were still a MEMBER of the COOPERATIVE. The obligation of the COOPERATIVE to administer the claims filed under the benefit program of the expelled MEMBER shall cease thirty (30) days after the date of expulsion, provided that the MEMBER is not in financial arrears to the COOPERATIVE. After expulsion, the COOPERATIVE or its Administrator may agree by contract to administer the claims of the expelled MEMBER using funds furnished by the expelled MEMBER. M 9 /5 /9G--ADOPT LON COPY 4/12 /00-- amendment '7/18/01- a;nendmen[ ARTICLE ?VII. Withdrawal of a Member and Continuation or Termination of the COOPERATIVE. All MEMBERS of the COOPERATIVE shall be obligated to continue as MEMBERS during a three -year membership cycle. The first three- year membership cycle under the Second Consolidated amendment to the Contract and By -Laws shall commence on July 1, 1996. The obligation of a MEMBER during each cycle in which it is a MEMBER shall include continuing participation with regard to all classes of officers and employees of the MEMBER, not including its listed entities, established as being entitled to benefits at the commencement of each three -year cycle. Provided, however, that upon a two- thirds (2/3) affirmative vote of the entire membership of the Board of Directors, any MEMBER may be relieved of continuing participation with regard to a particular class or classes of officers and employees of the MEMBER. In addition, a MEMBER shall only be required to provide continuing participation for those persons within such classes of officers and employees as are actually employed or working for the MEMBER. In order to continue as a MEMBER of the COOPERATIVE into the three -year cycle commencing on July 1, 1999, and for each three- year cycle thereafter, the governing Board of each MEMBER must, at least sixty (60) days before the commencement date, pass an ordinance or resolution agreeing to continue as a MEMBER for the new three -year term. Failure to pass a timely ordinance or resolution shall constitute a withdrawal; provided, however, that 39 r a 9 /5 /96-- ADOPTION COPY :1.2/00-- amendment 7/13/01 -- amendment by the majority vote of the entire continuing MEMBERS, the withdrawal may be canceled and the MEMBER, at its request, may be reinstated. If a MEMBER should withdraw from the COOPERATIVE, no benefit claims of the MEMBER shall be processed or paid by the COOPERATIVE after the close of the fiscal year in which withdrawal takes place, unless the withdrawing MEMBER shall enter into a contract with the COOPERATIVE or the Administrator to provide such services using funds furnished by the withdrawing MEMBER. Pending claims and other records relating to the withdrawing MEMBER shall be turned over to that MEMBER in a prompt manner. A -1 With regards to benefit claims and administrative fees after (7/18/01) - a MEMBER withdraws in any way from the COOPERATIVE, the contract between the COOPERATIVE and the Administrator of the HMO may provide that the COOPERATIVE is responsible for certain payments to the HMO for benefit claims and administrative costs for a continu- ing period. If a contract contains such a provision, the withdraw- ing MEMBER is responsible for the payment to the COOPERATIVE for all of such pavments for the period contained within that agree- ment. A -1 Within one - hundred twenty (120) days after the approval of the (7/18/01) audit of the COOPERATIVE for the prior fiscal year, a final accounting of funds owed or owing shall take place. Such account- ing shall include all funds of the COOPERATIVE. If the amount owed to or owing from the withdrawing MEMBER shall be $25,000 or less, 40 9 /5 /96-- ADOPTION COPY 4/12/00 -- amendment 7/18/01 -- amendment the party owing such funds shall make payment within ninety (90) days after the final accounting. If the amount owed to or owing from the withdrawing MEMBER shall be over $25,000, the party owing A -1 such funds may pay such funds owed in no more than 13 equal monthly (7/18/01) payments with interest at the highest amount lawfully payable by a A -1 non -home rule Illinois municipality with the first payment to (7/18/0.1) commence within ninety (90) days after the final accounting is established. A -7 If a MEMBER should withdraw from the COOPERATIVE. and the (7/18/01) COOPERATIVE should in error pay any benefit claims administrative fees or other charges on behalf of a withdrawing Member which it was not obligated to pay, the withdrawing Member shall, upon thirty (30) days' written notice, reimburse the COOPERATIVE for the amounts improperly paid. If the withdrawal of MEMBERS prior to the start of any three- year cycle shall reduce the number of covered employees and officers of the remaining MEMBERS, and any new MEMBERS legally committed to membership for the next three -year cycle, to less than 750 persons, the COOPERATIVE shall, except for winding up its affairs, cease its operations at the end of the then - concluding fiscal year. In that case, the Board of Directors shall continue to meet on such a schedule as shall be necessary to carry out the winding up of the affairs of the COOPERATIVE. If, during any fiscal year, the number of covered employees and officers should, through the withdrawal or expulsion of listed entities or attri- 41 9 /5 /96-- ADOPTION COPY •1/17/00- amendment '7/19/01. -- amendment Lion, be reduced to belo�,7 500 persons, any MEMBER may call a special meeting to discuss the feasibility of continuing the COOPERATIVE in operation until the close of that fiscal year. All withdra wing MEMBERS shall remain fully obligated for their portion of all expenses of and claims against the COOPERATIVE incurred during the period of their membership. If any MEMBER should file a suit against the COOPERATIVE questioning the validity of the Contract and By - -Laws document, or should raise the validity of this document in a suit by the COOPERATIVE and the validity of the Contract and By -Laws document is sustained, that MEMBER shall pay for the full legal and defense costs of the COOPERATIVE in that suit. I P13096A DOPTIO i \.5- I \ 1379623.00117115101 42 - INTERGOVERNMENTAL AGREEMENT BETWEEN THE VILLAGE OF DEERFIELD AND DEERFIELD PUBLIC LIBRARY THIS AGREEMENT, made and entered into this Jay of , 2003, by and between the VILLAGE OF DEERFIELD, an Illinois municipal corporation ( "DEERFIELD ") and the DEERFIELD PUBLIC LIBRARY, an Illinois municipal corporation ( "LIBRARY "), WITNESSETH: WHEREAS, Section 10 of Article VII of the Illinois Constitution of 1970 authorizes units of local government to contract or otherwise associate among themselves in any manner not prohibited by law or by ordinance; and WHEREAS, the "Intergovernmental Cooperation Act," 5 ILCS 220/1 et sea. authorizes units of local government to exercise any power or powers, privileges or authority which may be exercised by a unit of local government individually, to be exercised and enjoyed jointly with any other unit of local government in the State; and WHEREAS, units of local government within Illinois have found it increasingly expensive to provide health and life insurance benefits to their officers and employees; and WHEREAS, a large number of local government entities, having undertaken a series of studies to determine the feasibility of entering into an Intergovernmental Personnel Benefits Cooperative ( "IPBC ") for the purpose of administering some or all of the personnel benefits programs offered by its member units of local government to their respective officers and employees, created and have successfully operated such a Cooperative; and WHEREAS, the corporate authorities of DEERFIELD have approved membership in the IPBC and have adopted a combined Contract and By -Laws for such agency (the "IPBC BY- LAWS "); and WHEREAS, the Contract and By -Laws of IPBC ( "IPBC BY- LAWS "), as amended, allow combinations of units of local government, other governmental bodies, quasi governmental bodies and non - profit public service entities to contract with each other to create an intergovernmental benefit pool with the rights and powers equivalent to that of a single member of IPBC; and WHEREAS, the IPBC BY -LAWS provide that DEERFIELD, as a member of the IPBC, may add listed entities to receive benefits as defined in the IPBC BY -LAWS, provided, however, that the member who lists other entities to its membership shall be the sole member of the IPBC and shall be responsible for all costs and duties of membership provided by the IPBC BY -LAWS; and WHEREAS, LIBRARY is qualified as a unit of local government entity and has requested that DEERFIELD add LIBRARY as a listed entity to DEERFIELD' S membership in IPBC, provided LIBRARY is responsible for and subject to all of the costs, expenses, liabilities, obligations and conditions arising out of such listing, as is more fully set forth in this Agreement; and WHEREAS, the IPBC has consented to DEERFIELD adding LIBRARY as a listed entity to DEERFIELD' S membership in IPBC. NOW, THEREFORE, in consideration of the foregoing recitals and the covenants and conditions hereinafter contained, the adequacy and sufficiency of which the parties hereto hereby stipulate, the parties agree as follows: 1. INCORPORATION OF RECITALS: The recitals contained hereinabove are incorporated herein by reference as substantive provisions of this Agreement. 2. LISTING OF LIBRARY: Subject to all the terms, provisions, conditions and restrictions of the IPBC BY -LAWS, DEERFIELD agrees to add LIBRARY as a listed entity to its membership in IPBC. LIBRARY shall not be deemed to be a member of IPBC. 3. PLAN OF BENEFITS: The plan of Benefits to be available to eligible employees of LIBRARY shall be the Plan of Benefits available to DEERFIELD employees, as approved and amended from time to time by the Board of Directors of IPBC and as available from time to time to employees of the Village of DEERFIELD, subject to all of the conditions and restrictions set forth in the IPBC BY -LAWS, except that Term Life and Accidental Death and Dismemberment Coverage for LIBRARY employees shall be one (1) times the annual salary with a minimum of $20,000 up to a maximum of $100,000.00. In the event LIBRARY wishes to provide a Plan of Benefits through DEERFIELD'S membership in IPBC that is different than noted herein, such differences shall be subject to the approval of IPBC and DEERFIELD. Changes to the Plan of Benefits, other than changes required by IPBC, shall be made by DEERFIELD only after LIBRARY has been fully informed of the proposed changes, and DEERFIELD and LIBRARY have consulted with one another in a good faith effort to mutually agree on such changes. 4. ELIGIBLE EMPLOYEES: Only eligible employees of LIBRARY shall be eligible to participate in and receive benefits under the Plan of Benefits. For purposes of this Agreement, "eligible employees" shall be defined as set forth in the Personnel Manual adopted by LIBRARY, as amended from time to time. Notwithstanding anything contained herein to the contrary, employees of LIBRARY shall not be deemed to be employees of DEERFIELD for any purposes. 5. COSTS OF PARTICIPATION: LIBRARY shall promptly pay all costs attributable to LIBRARY being a listed entity to DEERFIELD' S membership in IPBC and participating in the Plan of Benefits, at such terms and in such amounts as shall be established from time to time by IPBC and/or DEERFIELD. LIBRARY shall be notified immediately upon any change in the time or amount of payment. 6. OBLIGATIONS OF LIBRARY TO DEERFIELD: Except to the extent expressly modified by the terms and provisions of this Agreement, LIBRARY shall be obligated to 3 DEERFIELD to the same extent that it would be obligated in any manner to IPBC pursuant to the IPBC BY -LAWS, as though it were a member of IPBC. 7. EXPULSION OF LIBRARY: By a majority vote of the corporate authorities of DEERFIELD, LIBRARY may be expelled as a listed agency to DEERFIELD'S membership in IPBC. Such expulsion may be carried out for one or more of the following reasons: A. Failure to make any payments due to DEERFIELD or IPBC under this Agreement. B. Failure to furnish full cooperation with the IPBC or DEERFIELD'S attorneys, claims adjusters, benefit administrator or any agent, employee, officer or independent contractor of the IPBC or DEERFIELD relating to the purpose and powers of the IPBC or DEERFIELD'S participation therein, and/or, ,C. Failure to carry out any obligation which impairs the ability of DEERFIELD to participate in IPBC or which impairs the ability of IPBC to carry out its purposes and powers. LIBRARY may not be expelled except after written notice from DEERFIELD of the alleged failure, together with a reasonable opportunity, of not less than ten (10) days nor more than thirty (3 0) days, to cure the alleged failure. 8. WITHDRAWAL AS A LISTED AGENCY: With or without cause, LIBRARY may withdraw as a listed agency to DEERFIELD'S membership in IPBC by giving written notice of withdrawal to DEERFIELD at least ninety (90) days prior to the commencement of any fiscal year of IPBC. At the present time, the fiscal year of IPBC commences on July 0. Failure to give such notice shall obligate LIBRARY to continue as a listed agency for the next fiscal year, except where Cm DEERFIELD withdraws from IPBC, IPBC terminates, IPBC declines to permit DEERFIELD to remain within IPBC, or IPBC declines to permit LIBRARY to remain as a listed entity. Withdrawal by LIBRARY may only be made to take affect at the end of the then current fiscal year. 9. TERMINATION OF LIBRARY AS A LISTED ENTITY: With or without cause, DEERFIELD may terminate LIBRARY as a listed entity to DEERFIELD' S membership in IPBC by giving written notice of termination of LIBRARY at least ninety (90) days prior to the commencement of any fiscal year of IPBC. Failure to give such notice shall not obligate DEERFIELD to continue LIBRARY as a listed entity to DEERFIELD'S membership in IPBC. 10. INDEMNIFICATION: To the fullest extent permitted by law, LIBRARY hereby agrees to defend, indemnify and hold harmless DEERFIELD, its officers, agents and employees, against all injuries, deaths, loss,. damages, claims, suits, liabilities, judgments, costs and expenses, which may in any way accrue against DEERFIELD, its officers, agents and employees, arising in whole or in part or in consequence of the performance of this Agreement and DEERFIELD' S adding LIBRARY as a listed entity to DEERFIELD' S membership to IPBC. LIBRARY shall, at its own expense, appear, defend and pay all charges of attorneys and all costs and other expenses arising therefor or incurred in connection therewith, and if any judgment shall be rendered against DEERFIELD, its officers, agents and employees, in any such action, LIBRARY shall, at its own expense, satisfy and discharge the same. N 11. LIMITATION OF REMEDIES TO LIBRARY AND DEERFIELD: The sole remedies available to LIBRARY or DEERFIELD, upon any breach of this Agreement by the other party, shall be specific performance or the cancellation of this Agreement. It is of the essence of this Agreement that LIBRARY and DEERFIELD shall not be liable in money damages for any breach of 5 this Agreement except for any obligation of LIBRARY to pay unpaid amounts or any obligation of DEERFIELD to return overpayments. 12. ENTIRE UNDERSTANDING: This Agreement sets forth the entire understanding of the parties and may only be amended by a written instrument signed by the parties hereto. 13. ASSIGNMENT: This Agreement shall not be assigned by any party hereto. 14. COUNTERPARTS: This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original. 15. NOTICES: All notices hereunder shall be in writing and must be served either personally or by registered or certified mail to: A. DEERFIELD: Village of DEERFIELD 850 Waukegan Road DEERFIELD, IL 60015 B. LIBRARY: DEERFIELD PUBLIC LIBRARY 920 Waukegan Road Deerfield, IL 60015 C. To any such person or place which any party hereto, by its prior written notice, shall designate for notice to it from the other parties hereto. 16. GOVERNING LAW: This Agreement shall be governed in accordance with the laws of the State of Illinois. 17. EFFECTIVE DATE: The provisions of this Agreement shall become effective and LIBRARY shall be deemed to be a listed entity of DEERFIELD'S membership in IPBC at 12:01 a.m. on M , 2003. n IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and duly attested in accordance with ordinances duly passed by their respective corporate authorities. ATTEST: & A�j Village Clerk ATTEST: R, , , � oivM � 7 DEERFIELD PUBLIC LIBRARY By : gin, L .�,� President r INTERGOVERNMENTAL AGREEMENT BETWEEN THE VILLAGE OF DEERFIELD AND DEERFIELD PARK DISTRICT THIS AGREEMENT, made and entered into this � ay of , 2003, by and between the VILLAGE OF DEERFIELD, an Illinois municipal corporation ( "DEERFIELD ") and the DEERFIELD PARK DISTRICT, an Illinois municipal corporation ( "DISTRICT "), WITNESSETH: WHEREAS, Section 10 of Article VII of the Illinois Constitution of 1970 authorizes units of local government to contract or otherwise associate among themselves in any manner not prohibited by law or by ordinance; and WHEREAS, the "Intergovernmental Cooperation Act," 5 ILCS 220/1 et se Q. authorizes units of local government to exercise any power or powers, privileges or authority which may be exercised by a unit of local government individually, to be exercised and enjoyed jointly with any other unit of local government in the State; and WHEREAS, units of local government within Illinois have found it increasingly expensive to provide health and life insurance benefits to their officers and employees; and WHEREAS, a large number of local government entities, having undertaken a series of studies to determine the feasibility of entering into an Intergovernmental Personnel Benefits Cooperative ( "IPBC ") for the purpose of administering some or all of the personnel benefits programs offered by its member units of local government to their respective officers and employees, created and have successfully operated such a Cooperative; and WHEREAS, the corporate authorities of DEERFIELD have approved membership in the IPBC and have adopted a combined Contract and By -Laws for such agency (the " IPBC BY- LAWS "); and WHEREAS, the Contract and By -Laws of IPBC ("IPBC BY- LAWS "), as amended, allow combinations of units of local government, other governmental bodies, quasi governmental bodies and non - profit public service entities to contract with each other to create an intergovernmental benefit pool with the rights and powers equivalent to that of a single member of IPBC; and WHEREAS, the IPBC BY -LAWS provide that DEERFIELD, as a member of the IPBC, may add listed entities to receive benefits as defined in the IPBC BY -LAWS, provided, however, that the member who lists other entities to its membership shall be the sole member of the IPBC and shall be responsible for all costs and duties of membership provided by the IPBC BY -LAWS; and WHEREAS, DISTRICT is qualified as a unit of local government and has requested that DEERFIELD add DISTRICT as a listed entity to DEERFIELD'S membership in IPBC, provided DISTRICT is responsible for and subject to all of the costs, expenses, liabilities, obligations and conditions arising out of such listing, as is more fully set forth in this Agreement; and WHEREAS, the IPBC has heretofore consented to DEERFIELD adding DISTRICT as a listed entity to DEERFIELD'S membership in IPBC. NOW, THEREFORE, in consideration of the foregoing recitals and the covenants and conditions hereinafter contained, the adequacy and sufficiency of which the parties hereto hereby stipulate, the parties agree as follows: 1. INCORPORATION OF RECITALS: The recitals contained hereinabove are incorporated herein by reference as substantive provisions of this Agreement. 2. LISTING OF DISTRICT: Subject to all the terms, provisions, conditions and restrictions of the IPBC BY -LAWS, DEERFIELD agrees to add DISTRICT as a listed entity to its membership in IPBC. DISTRICT shall not be deemed to be a member of IPBC. 3. PLAN OF BENEFITS: The plan of Benefits to be available to eligible employees of DISTRICT shall be the Plan of Benefits available to DEERFIELD employees, as approved and amended from time to time by the Board of Directors of IPBC and as available from time to time to employees of the Village of DEERFIELD, subject to all of the conditions and restrictions set forth in the IPBC BY -LAWS, except that Term Life and Accidental Death and Dismemberment Coverage for DISTRICT employees other than DISTRICT supervisors shall be one (1) times the annual salary with a minimum of $20,000 up to a maximum of $100,000.00; and for DISTRICT supervisors shall be two (2) times annual salary up to a maximum of $100,000. In the event DISTRICT wishes to provide a Plan of Benefits through DEERFIELD'S membership in IPBC that is different than noted herein, such differences shall be subject to the approval of IPBC and DEERFIELD. Changes to the Plan of Benefits, other than changes required by IPBC, shall be made by DEERFIELD only after DISTRICT has been fully informed of the proposed changes, and DEERFIELD and DISTRICT have consulted with one another in a good faith effort to mutually agree on such changes. 4. ELIGIBLE EMPLOYEES: Only eligible employees of DISTRICT shall be eligible to participate in and receive benefits under the Plan of Benefits. For purposes of this Agreement, "eligible employees" shall be defined as set forth in the Personnel Manual adopted by DISTRICT, as amended from time to time. Notwithstanding anything contained herein to the contrary, employees of DISTRICT shall not be deemed to be employees of DEERFIELD for any purposes. 5. COSTS OF PARTICIPATION: DISTRICT shall promptly pay all costs attributable to DISTRICT being a listed entity to DEERFIELD'S membership in IPBC and participating in the Plan of Benefits, at such terms and in such amounts as shall be established from time to time by IPBC and/or DEERFIELD. DISTRICT shall be notified immediately upon any change in the time or amount of payment. 6. OBLIGATIONS OF DISTRICT TO DEERFIELD: Except to the extent expressly modified by the terms and provisions of this Agreement, DISTRICT shall be obligated to 3 DEERFIELD to the same extent that it would be obligated in any manner to IPBC pursuant to the IPBC BY -LAWS, as though it were a member of IPBC. 7. EXPULSION OF DISTRICT: By a majority vote of the corporate authorities of DEERFIELD, DISTRICT may be expelled as a listed agency to DEERFIELD'S membership in IPBC. Such expulsion may be carried out for one or more of the following reasons: A. Failure to make any payments due to DEERFIELD or IPBC under this Agreement. B. Failure to furnish full cooperation with the IPBC or DEERFIELD'S attorneys, claims adjusters, benefit administrator or any agent, employee, officer or independent contractor of the IPBC or DEERFIELD relating to the purpose and powers of the IPBC or DEERFIELD'S participation therein, and/or, C. Failure to carry out any obligation which impairs the ability of DEERFIELD to participate in IPBC or which impairs the ability of IPBC to carry out its purposes and powers. DISTRICT may not be expelled except after written notice from DEERFIELD of the alleged failure, together with a reasonable opportunity, of not less than ten (10) days nor more than thirty (3 0) days, to cure the alleged failure. 8. WITHDRAWAL AS A LISTED AGENCY: With or without cause, DISTRICT may withdraw as a listed agency to DEERFIELD'S membership in IPBC by giving written notice of withdrawal to DEERFIELD at least ninety (90) days prior to the commencement of any fiscal year of IPBC. At the present time, the fiscal year of IPBC commences on July 1s`. Failure to give such notice shall obligate DISTRICT to continue as a listed agency for the next fiscal year, except where DEERFIELD withdraws from IPBC, IPBC terminates, IPBC declines to permit DEERFIELD to 4 remain within IPBC, or IPBC declines to permit DISTRICT to remain as a listed entity. Withdrawal by DISTRICT may only be made to take affect at the end of the then current fiscal year. 9. TERMINATION OF DISTRICT AS A LISTED ENTITY: With or without cause, DEERFIELD may terminate DISTRICT as a listed entity to DEERFIELD'S membership in IPBC by giving written notice of termination of DISTRICT at least ninety (90) days prior to the commencement of any fiscal year of IPBC. Failure to give such notice shall not obligate DEERFIELD to continue DISTRICT as a listed entity to DEERFIELD'S membership in IPBC. 10. INDEMNIFICATION: To the fullest extent permitted by law, DISTRICT hereby agrees to defend, indemnify and hold harmless DEERFIELD, its officers, agents and employees, against all injuries, deaths, loss, damages, claims, suits, liabilities, judgments, costs and expenses, which may in any way accrue against DEERFIELD, its officers, agents and employees, arising in whole or in part or in consequence of the performance of this Agreement and DEERFIELD'S adding DISTRICT as a listed entity to DEERFIELD'S membership to IPBC. DISTRICT shall, at its own expense, appear, defend and pay all charges of attorneys and all costs and other expenses arising therefor or incurred in connection therewith, and if any judgment shall be rendered against DEERFIELD, its officers, agents and employees, in any such action, DISTRICT shall, at its own expense, satisfy and discharge the same. 11. LIMITATION OF REMEDIES TO DISTRICT AND DEERFIELD: The sole remedies available to DISTRICT or DEERFIELD, upon any breach of this Agreement by the other party, shall be specific performance or the cancellation of this Agreement. It is of the essence of this Agreement that DISTRICT and DEERFIELD shall not be liable in money damages for any breach of this Agreement except for any obligation of DISTRICT to pay unpaid amounts or any obligation of DEERFIELD to return overpayments. E 12. ENTIRE UNDERSTANDING: This Agreement sets forth the entire understanding of the parties and may only be amended by a written instrument signed by the parties hereto. 13. ASSIGNMENT: This Agreement shall not be assigned by any party hereto. 14. COUNTERPARTS: This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original. 15. NOTICES: All notices hereunder shall be in writing and must be served either personally or by registered or certified mail to: A. DEERFIELD: Village of DEERFIELD 850 Waukegan Road DEERFIELD, IL 60015 B. DISTRICT: DEERFIELD PARK DISTRICT 836 Jewett Park Drive Deerfield, IL 60015 C. To any such person or place which any party hereto, by its prior written notice, shall designate for notice to it from the other parties hereto. 16. GOVERNING LAW: This Agreement shall be governed in accordance with the laws of the State of Illinois. 17. EFFECTIVE DATE: The provisions of this Agreement shall become effective and DISTRICT shall be deemed to be a listed entity of DEERFIELD'S membership in IPBC at 12:01 a.m. on M411 Oe , 2003. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and duly attested in accordance with ordinances duly passed by their respective corporate authorities. G'i ATTEST: ATTEST: Village Clerk Se Ye t IV DEERFIELD PARK DISTRICT By. President