WEBSTER CENTRAL SCHOOL DISTRICT Brian Neenan Superintendent Brian_Neenan@webstercsd.org (585) 216-0001 Erin Land Assistant Superintendent for Instruction Erin_Land@webstercsd.org (585) 216-0130
David Swinson Assistant Superintendent for Administration and Human Resources David_Swinson@webstercsd.org (585) 216-0011 Brian Freeman Assistant Superintendent for Business Brian_Freeman@webstercsd.org (585) 216-0017
4/1/2023 To: Brian Neenan, Superintendent From: Brian Freeman, Assistant Superintendent for Business Re: Creation of Insurance Reserve Fund It is the recommendation of the Business Office to establish and fund an Insurance Reserve beginning in the fiscal year 2022-23. The reserve will be expressly utilized to offset any technology related expenditures for cybersecurity issues that may arise. With the recent increases in liability insurance premiums for cybersecurity policies, it has become financially prudent to begin our own self insured reserve for any potential losses. It is predicted that many of the insurance carriers will begin to leave the market, thus driving costs up even further for districts who carry additional cyber security liability coverage. For reference, the district last funded an insurance reserve in 2011-12. That reserve was collapsed and remaining funds were put into the Employee Retirement Reserve. You may recall at the time there was a significant economic crisis that required flexibility in reserve usage that created the impetus for the change. Attached you will find the resolution to establish the new reserve. After consultation with our auditors, it is recommended at this time to fund this reserve with an initial $2,000,000 in fund balance. The reserve is allowed to be funded up to 5% of the total budget, or $9,790,673 for 2022-23. The creation of this reserve will not only put the district in a stronger position to offset future claims and certain increases in rates, but will also cover the district’s liability against any potential losses. Please let me know if you have any additional questions. The resolution needed is as follows on page 2.
Lori Schreiber, Treasurer
119 South Avenue, Webster, New York 14580 Main Switchboard: (585) 265-3600 • Fax Machine: (585) 265-6561 • Web Site: www.websterschools.org
RESOLUTION ESTABLISHING AN INSURANCE RESERVE FUND BE IT RESOLVED, by the Board of Education of the Webster Central School District, pursuant to Section 6-n of the General Municipal Law, as follows: 1.
The Board hereby establishes a reserve fund to be known as the Insurance Reserve Fund;
2.
The source of funds for such fund shall be such amounts as may be provided therefor by budgetary appropriation, amounts from any other fund authorized by the General Municipal Law subject to permissive referendum or such other funds as may be legally appropriated;
3.
The amount paid into such fund during any fiscal year shall not exceed the greater of Thirty-Three Thousand Dollars ($33,000.00) or five per centum (5%) of the total budget for such fiscal year;
4.
Monies in such fund may be appropriated only to fund certain uninsured losses, claims, actions or judgments for which the District is authorized or required to purchase or maintain insurance. Monies in such fund may also be appropriated for expert or professional services in connection with the investigation, adjustment, or settlement of claims, actions or judgments;
5.
The Treasurer is hereby authorized and directed to deposit and invest the monies of such fund in accordance with Sections 10 and 11 of the General Municipal Law and other applicable law and as provided by Section 6-n of the General Municipal Law. Any interest earned or capital gains realized on the money so deposited or so invested shall accrue to and become a part of each such fund. The Treasurer shall account for this fund separate and apart from all other funds. Such account shall show: (a) the source, date and amount of each sum paid into the fund; (b) the interest earned by such fund; (c) the capital gains or losses resulting from the sale of investments of the fund; (d) the order, purpose thereof, date and amount of each payment from this fund; (e) the assets of the fund, indicating cash balance and a schedule of investments. The Treasurer shall keep a separate account for each kind of risk funded and shall also, within sixty days of the end of each fiscal year, furnish a detailed report of the operation and condition of this fund to the Board of Education;
6.
A sum not to exceed $2,000,000 is hereby appropriated to such fund, to be paid from the unappropriated fund balance.
7.
This Resolution shall take effect immediately.
April 18, 2023
___________________________________ Cynthia Cushman, District Clerk Webster Central School District
119 South Avenue, Webster, New York 14580 Main Switchboard: (585) 265-3600 • Fax Machine: (585) 265-6561 • Web Site: www.websterschools.org