Key Largo Wastewater Treatment District Board of Commissioners Meeting Agenda Item Summary Meeting Date; Agenda Item Number: H-1 February 16, 2021 Agenda Item Type: Agenda Item Scope: Recommended Action: Information / Presentation Review / Discussion Discussion Department: Sponsor: Finance Maintenance Dept. Subject: Fleet Replacement Plan - Admin Vehicle Summary of Discussion: At the January 5, 2021 KLWTD board meeting. The Board requested that the Admin vehicle purchase portion of the Fleet Replacement plan be placed on the agenda for the Feb. 16, 2021 board meeting. In addition, per Board request, we have included information regarding extended warranty for the Durango, and information regarding the use of employees' personal vehicles. Ea Reviewed I Approved Financial Impact Attachments Operations: 1.Memo 2.Brown & Brown Ins. emails Administration; regarding personal vehicle use Finance: Funding Source: 3.Fleet Replacement Plan for FY21 District Counsel: 4. Vehicle Quote District Clerk: Budgeted: 5. Extended Warranty info Yes 6. Kelley Blue Book info Engineering: El f 2 - //' Approved By: Date: General Manager 12 KLWTD Admin Dept. Vehicle Background: When Ryan Dempsey, Maintenance Manager, brought the fleet replacement plan to the Board, the plan included a replacement vehicle for Admin Dept In FY21, to se ll the Durango on GovDeals. In March 2020, due to Covid-19 policy changes to allow one employee in one vehicle, the Durango was given to Field Dept for use, and has continued to stay with Field Dept. It is no longer available for Admin Dept. use. An Admin Vehicle is used for: Short term Errands: • Monroe County (various offices), DMV, Post Office, KLWTD plant for meetings, records room • Centennial Bank, First St ate Bank • Trips to Marathon and lslamorada for meetings, CPR training; Countywide Meetings Long term trips: • Trips to airport to attend meetings in Tallahassee and Washington DC; Airvac training in Indiana (multiple field employees go at one time, can ta ke Admin vehicle vs. taking own vehicle) • Training trips to be used by multiple departments: i.e. Award ceremonies in Punta Gorda; BSA training sessions in Orlando, and other training in various parts of the state Benefits of having an Admin Vehicle: 1. Will remove the concern of using personal vehicles for District business (our PGIT insurance is secondary in any accident, t he employee's personal insurance will be primary) if accident occurs. 2. Will remove the need for mileage reimbursement expenses for employee use of personal vehicles. 3. Will reduce the need to rent a vehicle for long term trips. (see above) 4. Multiple employees are covered under District insurance when sharing driving on long term trips. Drawbacks of not purchasing a vehicle for Admin in early 2021: 1. The Durango will not be available to be returned to Admin until late summer/early fall, as the new truck orders are behind schedule 2. Operations trucks will continue to require single passenger use, so even when Durango is available, it might be a good idea to keep it as an extra vehicle to be used when other trucks are in the shop. 3. If the goa l is to sell the Durango, it is better to do it sooner rather than later to maximize its resa le value. In addition, since it has now been used as a Field Dept. vehicle, the wear and tear of the type of mileage may impact the Durango's resale value. Recommendations from Brown & Brow n (T.R. Jones) Insura nce: (see emails from Brown & Brown Insurance) • If personal vehicles are used with District errands, KLWTD should run MVRs on an annual basis to confirm that there are not any non-compliant issues with employee's auto insurance. • Proof of insurance should be required by each employee on an annual basis. • Employees should be aware that the employee's personal insurance coverage is PRIMARY when it comes to any accident, and the District's vehicle insurance is secondary. • It is suggested that employees sign a personal vehicle use agreement with KLWTD for clear understanding of each party's responsibility in an accident. 13 EMAILS BETWEEN KLWTD AND BROWN & BROWN INSURANCE Kathy Nicotra <knicotra@ bbinsfl.com Connie, see below from the Director of Underwriting at PGIT. This should answer your question but if you need anything else, let me know! Kathy From : Margaret Gross <[email protected]> Sent: Friday, February 5, 2021 1 :24 PM To: Kathy Nicotra <[email protected]> Subject: RE: Quick Question on Non Owned & PGIT form Hi Kathy, The HNO coverage is excess over the employee's limits. PGI T MN-300 (10 19) Sections II D. Other Coverage For any covered "autos" you do not own, hire, rent or borrow that are used in connection with your business, the coverage provided by this Coverage Form is excess over any other collectible coverage. If the employee's coverage had lapsed, the coverage would protect the District and be primary., but I'm not sure it would protect the employee, because the employee would have violated the law by operating an uninsured personal vehicle. I'm not sure how the liability laws would apply in that situation. Kind regards, Margaret E. Gross, CPCU Director of Underwriting Public Risk Underwriters®, Administrator for Preferred 14 On Fri, Jan 29, 2021 at 9:59 AM Kathy Nicotra <[email protected]> wrote: Connie, I believe that PGIT would then become primary. If the employee owns a personal vehicle he must comply with Florida Statutes and purchase the minimum required limits. Do you run MVR's at least annually? Noncompliance might show up on the record. Maybe you do want to require proof of in surance but not make a limit requirement. Kathy From: Connie Fazio <[email protected]> Sent: Thursday, January 28, 2021 3:52 PM To: Kathy Nicotra <[email protected]> Subject: Re: Endorsement for personal automobile use for District work- quick question Hi Kathy: One more question. .... if one of our employees does not have auto insurance coverage, and has an accident in their personal vehicle while doing District business, does the PGIT secondary coverage become primary in that case? Or because there is no primary insurance on the vehicle, does the secondary insurance kick in? Thanks­ Connie 15 On Wed, Jan 27, 2021 at 3:55 PM Kathy Nicotra <[email protected]> wrote: Hi Connie, I can share with you that most of the governmental entities I work with are municipalities with hundreds of employees and large fleets. Typically, the employee has the option of using a City owned vehicle or their personal auto. If they use their personal auto, they are eligible for mileage reimbursement. One client, for example, does not have an acknowledgement form and they don't request evidence of personal auto coverage. If an employee is involved in an accident while driving their personal auto on company business, they go through their personal auto carrier or are told to do so. From an underwriting perspective, many insurance companies want to know that the insured requires evidence of personal auto coverage for those employees that drive their vehicle on company business and that they ca rry specific limits. At one client, the required personal liability limit is $300,000. I can say that many of our clients don't have a requirement for evidence of personal auto liability or a limit requirement. That is not to say that the district should not. I think the acknowledgement that if they drive their personal auto on district business, their personal auto policy is primary is a good idea. With regards to minimum limits, that is really your call. You also have to take into consideration the time and effort required by the district in keeping the insurance data on employees current. I hope this helps. Kathy From: Connie Fazio <[email protected]> Sent: Tuesday, January 26, 2021 3:52 PM To: Kathy Nicotra <[email protected]> Subject: Re: Endorsement for personal automobile use for District work- quick question Hi Kathy: I have an updated question for you regarding the use of personal vehicles by KLWTD employees, and wondered if you could review the emails from August 2018 below, and let us know what other governmental entity clients do in these situations. Do they allow employees to drive their own vehicles, and if so, is the best practice to have a statement that they sign so they are aware of the risks of using their own vehicles for District-related errands/trips? And do you recommend that they provide the District with copies of their personal insurance coverage? Thank you- Connie 16 On Wed, Sep 12, 2018 at 9:43 AM Kathy Nicotra <[email protected]> wrote: Hi Connie, I don 't know that your question below got answered. KLWTD currently has symbol 1 on your business auto that provides liability coverage for all owned, non-owned & hired vehicles. You already have the coverage. However, the non-owned auto liability coverage would be excess over the employee's personal auto policy. Personal auto policy would respond/pay first, then PGIT would step in with regards to liability. There is no excess Comp or Collision coverage for the employees vehicle used in business. Their personal auto carrier would be the only remedy for damage to their vehicle, in the event of a claim. Let me know if you or Peter have additional questions. Regards, Kathy Kathy Nicotra-Duffy Account Executive to Thomas R. Jones - Brown & Brown of Florida dba T.R. Jones & Company Fwd: Endorsement for personal automobile use for District work 1 message Connie Fazio <connie. [email protected]> Thu, Aug 9, 2018 at 4: 11 PM To: "Peter L. Rosasco" <[email protected]> Endorsement for business use of personal vehicles of KL WTD employees: Bottom line ...