Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Risk And Legal topic
No spam. Unsubscribe anytime.
Council hears that insurance and litigation costs are driving major budget pressure; city attorney urges staffing to reduce reliance on outside counsel
Summary
Risk manager and City Attorney Virginia Genero said insurance premiums and a growing litigation caseload are raising city costs; the attorney reported 184 active litigation matters and several high-value settlements, and recommended funding additional deputy and assistant city attorney positions to reduce outside counsel reliance.
Council members heard that escalating insurance premiums and a surge in litigation are major drivers of next year’s budget pressures.
Council member Gonzales noted a combined increase of about $4.6 million year over year—an approximately 15% rise in workers' compensation (stated as $3,100,000) and 10% for liability (stated as $1,400,000). Risk Manager Gina Covey told the council the risk department allocates insurance costs to departments using payroll and claim-severity methodologies and said the city is pursuing mitigation strategies such as driver-safety simulators and targeted audits.
City Attorney Virginia Genero described heavier litigation workload and reliance on outside counsel. She said the city handled 184 active litigation matters and reported three settlements over $1,000,000 (two exceeding $15,000,000), noting that while insurance covered payouts, rising claims drive premiums and raise uncertainty about future rates. Genero said her office’s budget shows a 9.6% increase even assuming the requested 5% cuts because of COLAs, insurance, and other unavoidable costs.
"We are handling all of the red and all of the blue ... Incoming lawsuits alone, these are just incoming. You look at 2021, there's about 20. It's doubled in four or five years," Genero said, urging the council to consider funding a chief assistant city attorney and other deputy positions so more work can be done in-house.
Gener0 (sic) — the office listed existing outside counsel contracts with Clifford and Brown, Marta Rosian and Cohen, and Duane Morris for water matters; Genero said additional outside counsel is now needed for CEQA, short-term rentals and certain land-trust and eminent-domain matters.
Council members asked how the city can reduce liability exposure; Genero and Covey each pointed to tort-caps and litigation‑avoidance strategies as issues that ultimately have state‑level implications. Gonzales asked about using code enforcement and receivership as tools to reduce long-term calls for service; Genero said receivership had produced positive results in past filings but there were no active suits in the court queue at this time.
Where it stands: the city attorney urged council consideration of funding additional attorney positions during the budget process to reduce long-term outside‑counsel costs; staff will continue to brief council as recruitment progresses.
