TITLE
Recommendation to authorize City Manager to accept insurance proceeds in the amount of $295,163 in the Insurance Fund in the Department of Human Resources to settle the claim for property damage sustained by Rancho Los Alamitos; and authorize the execution of any documents, including lease amendments, necessary to accept, implement, and administer the settlement and disbursement of the proceeds. (District 3)
DISCUSSION
Rancho Los Alamitos (Rancho), located at 6400 Bixby Hill Road, is a living historical site of State significance on the National Register of Historical Places. For nearly two decades, the Rancho Los Alamitos Foundation (Foundation) has overseen the management and operation of the Rancho on behalf of the City.
In January 2006, a winter storm damaged improvements at the Rancho. The fence surrounding the tennis court, the Jacaranda Walk, Grape Arbor, and Friendly Garden were battered. The total cost of repairs is estimated at $524,091. In accordance with the Lease, the City has an obligation to promptly make repairs to remedy partial or total destruction at the site. The City carries insurance coverage for the City-owned property, which is purchased through McLarens Young International. The Foundation carries business and property insurance coverage for its assets. Only City-owned property was damaged by the storm; Foundation assets were not harmed.
The Department of Parks, Recreation and Marine (PRM) and the City's Risk Management Office filed a damage claim against the City's insurance policy and jointly participated in negotiations. A $305,163 settlement was negotiated, approximately 60 percent of the total cost of repairs. Differing views on damages attributable to the storm, along with insurance policy exclusions, prevented the City from achieving a settlement of 100 percent of the repair costs. The $10,000 insurance deductible will be subtracted from the settlement and the City will receive a net sum of $295,163.
The Foundation ambit...
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