MARICOPA COUNTY
RISK MANAGEMENT ANNUAL REPORT
FISCAL YEAR 2004-05

TABLE OF CONTENTS

I.

EXECUTIVE SUMMARY

II.

CLAIMS DIVISION

III.

SAFETY DIVISION

IV.

ENVIRONMENTAL DIVISION

V.

ADMINISTRATIVE DIVISION

VI.

STATISTICS AND COVERAGE

RISK MANAGEMENT ANNUAL REPORT
EXECUTIVE SUMMARY

Presented herein is the Maricopa County Risk Management Annual Report, for the fiscal year July 1,
2004 to June 30, 2005.
This report contains summaries of the fiscal year’s losses and costs for Maricopa County’s auto
liability, auto physical damage, general liability, medical malpractice, property, workers’
compensation, and unemployment exposures. This report, along with ongoing quarterly reports to
County departments during the year, are intended to assist departments in recognizing the nature and
extent of their losses, and to lead departments to consider implementation of effective loss control
and prevention programs.
Structure and Mission
On June 30, 2005, the Risk Management Department completed its 24th year administering the
County’s self-insurance program. Risk Management’s mission is to provide loss prevention and
control programs and direction, insurance, environmental and claims management services to
Maricopa County departments, districts and Trust members to reduce or eliminate losses. Its vision
is to be recognized as a leader, and to be relied upon for a Countywide risk management philosophy
and culture. Risk Management’s primary activities are:
•
•
•
•
•
•
•
•
•

Risk consulting
Insurance procurement above self-insured retention levels
Maricopa County Self-Insured Trust Fund management and financing
Administration of and monitoring third party administrators’ adjusting
of workers’ compensation and unemployment claims
Investigation and disposition of casualty and property claims and lawsuits
Safety training, reporting and compliance
Loss control programs
Environmental investigation, remediation and reporting
Contractual indemnification and insurance requirement language drafting and review

The Risk Management Department is divided into three operating divisions, Claims, Safety and
Environmental, and one Administration division. Highlights for each division are contained in this
report. The staff strives to accomplish its mission with assistance and direction from the Maricopa
County Board of Supervisors, the Maricopa County Self-Insured Trust Fund Board of Trustees, and
the Office of the County Attorney. The Risk Manager reports to the Chief Financial Officer of
Maricopa County.

I-1

Self-Insured Trust Fund
Arizona law (ARS § 11-981) authorizes Maricopa County to self-insure, procure insurance from any
insurer authorized by the State of Arizona Department of Insurance, or both. Insurance (defined in
Title 20 Arizona Revised Statutes) includes, but is not limited to, auto liability, auto physical
damage, general liability, medical malpractice, property, workers’ compensation, and
unemployment insurance.
Upon establishment of a self-insurance program, Maricopa County is required to designate a Trust
Administrator (Risk Manager), and establish a Trust. The Trust is funded by an allocation of funds
from General Fund and Non-General Fund departments and Special Districts, or such other funding
techniques permitted by state statute and authorized by the Trust’s Board of Trustees.
A Board of Trustees manages and directs the Trust’s activities and affairs. Trustees must be United
States citizens and residents of Maricopa County, and are appointed by the Maricopa County Board
of Supervisors (BOS) and County Manager. During FY04-05, the following individuals were
members of the Board of Trustees:
Trustee District/Appointment

Trustee

BOS District One
BOS District Two
BOS District Three
BOS District Four
BOS District Five
BOS Chairman
County Manager

Michael Liburdi
Joel Sterrett
Donald (Dutch) Baker
David Tierney, Chairman
Peter Moraga
BOS Chairman
Tom Manos
FY04-05 Results

Maricopa County enjoyed mixed results this fiscal year in the risk/exposure area. Total claim costs
(dollars paid plus open reserves) were down 39.7% for this fiscal year, though this percentage could
be misleading since the figures do not include Incurred But Not Reported (IBNR) claims, which will
affect the ultimate percentages and total claim costs. A truer picture of fiscal year results is the Cost
of Risk. Although Risk Management’s costs increased $595,925 (2.8%), due primarily to the
increased costs of insurance premiums, the Cost of Risk (Risk Management’s costs compared to
total County expenditures) was a very good 0.94%. In addition, the County realized $1,062,548 in
net savings in FY04-05 through the use of in-network medical providers and a medical bill review
service, and collected $2,295,362 through subrogation, restitution, and deductible recovery efforts
(the Claims and Environmental divisions, and our Third Party Administrator for Workers’
Compensation). These positive results need to be viewed in light of the County’s growth in the
number of people served within the County and in services rendered.
Maricopa County continues to be one of the fastest growing counties in the nation with a population
over 3.5 million. It is the 4th most populous County in the United States, larger in population than
21 states, and larger geographically than 7 states. The County enjoyed a growth rate of
I-2

approximately 3.2% or 112,233 more people than last year. Such size and growth, while
economically positive, has resulted in an increase in the number of claims. Risk Management’s
emphasis on responsible claim handling and a strong proactive loss prevention and safety program is
designed to keep this increase to a minimum.
The number of Maricopa County employees varies from month to month. For FY03-04 and FY0405, the numbers of actual budgeted positions were 16,637 and 17,564, respectively. Workers’
compensation claims for FY03-04 and FY04-05 were 868 and 1039, respectively. This reflects an
increase in the number of budgeted positions of 5.6% over the previous fiscal year, and an increase
in the number of workers’ compensation claims of 19.7% over this period. This is a negative result
that Risk Management will seek to reverse.

I-3

Cost of Risk
Cost of Risk is a comparison of the County's expenditures of the risk management program to the
County’s overall expenditures in the fiscal year. The effectiveness of a risk management program
can be reflected in this comparison since the cost of a risk management program includes paid
claims (amounts paid in the fiscal year without regard to the year the claim arose), insurance
premiums, safety and loss control programs, and operational and administrative expenses, against
total County's expenditures. During the past three year period, Cost of Risk for the County has
remained under 1%, varying from 0.86% to 0.94%. This reflects a positive, stable result.
FY02-03

FY03-04

FY04-05

Claims and Premiums
Auto Liability

$162,686

$305,267

$333,947

$2,019,985

$1,420,281

$2,398,938

Medical Malpractice

$366,501

$482,400

$1,318,214

Property/Auto Physical Damage

$506,413

$729,133

$292,481

$3,481,554

$4,570,705

$4,064,099

$833,459

$801,973

$776,861

$625

$0

$0

$4,577,114

$3,931,045

$4,191,010

$11,948,337

$12,240,804

$13,375,550

$4,708,769

$6,702,686

$6,403,302

Broker Fees

$115,000

$130,000

$145,000

Consulting and Mngt Fees

$289,117

$198,048

$150,825

Claims Admin Fees

$320,532

$398,395

$394,527

$1,656,270

$1,789,538

$1,586,192

$7,089,688

$9,218,667

$8,679,846

$19,038,025

$21,459,471

$22,055,396

$2,220,941,795

$2,351,591,257

$2,353,876,507

0.86%

0.91%

0.94%

General Liability

Workers' Compensation
Unemployment
Environmental Contingency
Premiums
Subtotal
Other Costs
Legal Expenses

Administrative
Subtotal
Total Risk Management Costs
Total County Expenditures
TOTAL COST AS A PERCENTAGE
OF COUNTY EXPENDITURES
Notes:

1.
2.
3.
4.

Paid claims represents the amount paid in the fiscal year regardless of occurrence
date and does not include Reported But Not Paid (RBNP) or IBNR reserves.
Amounts as valued on June 30, 2005, as reported in the Advantage Financial System.
Total County Expenditures includes six months of Maricopa Integrated Healthcare System, as reported in
the Advantage Financial System.
Total County Expenditures includes six months of Maricopa County Special Health Care District, as
reported in the Accountants’ Report and Financial Statements on June 30, 2005.

I-4

Acknowledgment
The Risk Management Department would like to thank the Maricopa County Board of Supervisors,
Elected Officials, County Manager, Chief Financial Officer, Self-Insured Trust Fund Board of
Trustees, County Attorney’s Office, County departmental management, employees, and volunteers,
for their demonstrated interest in reducing claims and lawsuits, and their commitment to safety.
Respectfully submitted,

Peter J. Crowley
Risk Manager
Bill Warren, Assistant Risk Manager, Safety Division
Ted Howard, Claims Manager
Samantha Wright-Sprague, Administration Manager
Rita Neill, Environmental Programs Manager
Terry Jankowski, Administrative/Insurance Coordinator
Jenny Durda, Information Specialist
and the entire Risk Management Staff
Notes:

For presentation purposes only, the dollar amounts and associated percentages in all of the charts and tables
presented herein, have been rounded to the nearest whole dollar or percent.

I-5

CLAIMS DIVISION
The Claims Division of Risk Management handles all property and liability claims filed against
Maricopa County and its employees. The Division is staffed with five full time adjusters, a
manager, and support staff. In addition to handling the claims described above, the Division
oversees the adjustment of workers’ compensation and unemployment claims by third party
administrators. These claims are handled by Pinnacle Risk Services and Talx Employer Services
(formerly Sheakley UniService).
Claims are investigated and evaluated, then either paid or denied on their merits. Litigated claims
are assigned to either the County Attorney’s Office or outside counsel. The Division works with
assigned attorneys to obtain the most favorable result possible for the County. We are
committed to settling claims owed at a fair and reasonable amount while defending claims
without merit.
FY 04-05 Summary
New claims arising from events in FY04-05 reflect an overall increase in the total number of new
claims filed over the past three fiscal years. Since FY02-03, the total number of new claims
handled by the Claims Division has increased nearly 24%. Due to the efforts of the Claims
Division, the County continues to realize substantial savings from its property, liability and
worker's compensation exposures. The Division is committed to work to further improve in these
areas and help reduce the cost of risk to the taxpayers of Maricopa County.
In addition to handling claims, the Division provides the following services to the County:
•

Subrogation, restitution, and deductible recovery. In FY04-05, the Division collected
$2,284,881.

•

Consultation services. We report to, and consult with County departments on coverage
issues, pending claims and litigation. This is done as both an informational tool and as a
means to find ways to reduce claims or exposures.

•

Review and management of the third party administrator providing adjustment of
workers’ compensation claims for County employees. In addition to adjustment of these
losses, Pinnacle Risk Services and its affiliated vendors also conduct bill reviews and
monitor discounts available to the County for use of a PPO network. Over the last year,
the net savings with the use of in-network medical practitioners was $1,062,548 (relative
to billed charges).

•

Review of indemnity and insurance language in County contracts.

•

Oversee outside contractors providing automobile and property appraisal services,
vehicle repair services and structured settlement services to the County.

•

Coordinate recovery for County agencies from our excess property and liability insurance
policies.

II-1

SAFETY DIVISION
The Safety Division of Risk Management continued to focus on our countywide initiative to
ensure safety standard compliance and loss prevention organizationally. The process uses a
safety management system of supervisor and worker accountability along the theme of “Safety:
It’s the way we work!” The Division continues to consult with Agencies and Departments to
establish the safety management system as a core business function. The establishment of a
safety program continues to be crucial in reducing accidents and losses. As a clear example of its
efforts to improve departmental safety performance, workers compensation data this fiscal year
evidenced an overall increase in claims of 20% (868 claims in FY03-04, and 1039 claims in
FY04-05, see page VI-3 of the statistics and coverage section), while Workers’ Compensation
payments and reserves (see page VI-1 of the statistics and coverage section) were decreased from
$3,592,256 in FY03-04 to $2,756,159 in FY04-05, a $836,097 (23%) decrease.
Working to improve workplace safety and ensure compliance with safety standards, the
Division:
•

Negotiated with the United States Department of Labor and the Arizona Commerce
Commission the development of a Heavy Equipment Apprenticeship program for off
duty training.

•

Conducted a countywide four-day Employee Safety Fair and Equipment ROADEO, with
700 employees participating in 36 Safety Classes along with events testing operator skills
and knowledge of equipment operations.

•

Conducted two OSHA 500 Construction Industry and one OSHA 501 General Industry
40 hour Safety training courses to enhance employee safety knowledge.

•

Completed 485 field safety inspections, 169 facility safety inspections, 330 safety classes
and 126 safety consultations to enhance safety compliance and employee safety within
Maricopa County.

•

Successfully subrogated recovery for MCDOT damaged property. FY04-05, the Division
collected $13,142.30 from “at fault” parties that caused damage to MCDOT property.

Additionally, the Safety Division provides technical assistance and training to various
departments in the areas of occupational safety, fleet safety, drug & alcohol testing, commercial
drivers programs, heavy equipment training, hazardous materials management, OSHA
compliance, and hazard communication - employees “right-to-know” training. These efforts
continue to have a positive influence on the County’s safety awareness and loss prevention
efforts.
Safety is a total team effort! As Maricopa County continues to develop its strategies in
developing its safety management system, it is necessary that each level of management must
take a greater role in safety development. Including specific safety activities and initiative
within the County’s overall work process and evaluation creates a safe working environment. A
combination of management commitment and front line supervision accountability is the key to
sustaining the safety process and reducing unsafe work practices.

III-1

ENVIRONMENTAL DIVISION
The Environmental Division of Risk Management conducts remedial investigations and takes
action to minimize County environmental liability as determined by law, regulation, statute,
and/or court order. The Division provides leadership in the area of pollution prevention and
environmental management, and has developed a proactive assessment and action process that
mitigates environmental liabilities, saving the County in the cost of remedial action and
regulatory penalties. Possible environmental liability costs of known sites have been reduced
from previous estimates of over $500 million for FY95-96, to approximately $40 million for
FY04-05.
This fiscal year the Division:
•

Recovered $10,481 from the State of Arizona’s Department of Environmental Quality for
remedial actions for soil and groundwater contamination related to former leaking
underground storage tanks (USTs) at 4701 East Washington Street, site of the former
Sheriff’s Office, MCDOT yard and Vector Control.

•

Completed Phase I and II environmental assessments for 12 MIHS properties in
preparation for the transfer of the Medical Center to the new Health District.

•

Conducted negotiations with ADEQ regarding a new Consent Order for the Cave Creek
Landfill. Successfully deepened 2 existing monitoring wells and rehabilitated site
production well to comply with monitoring requirements and avoid costs of installing
new deep monitoring wells. Completed a vapor study of the Old and New Cave Creek
Landfills.

•

Completed Phase II environmental assessment of Sheriff’s shooting range.

•

Completed Phase I environmental assessments for 3 facilities. Completed assessments for
indoor air quality and mold at 4 additional facilities.

•

Assisted a County resident in completing requirements for applying to the ADEQ Orphan
Tank program.

•

Negotiated with ADEQ and completed the closure of the County’s 3 open leaking USTs.

•

Assisted Parks, Real Estate, MCSO and FMD in preparing Requests For Proposals for
environmental studies, indoor air quality and asbestos surveys.

•

Continued environmental evaluation of a former County landfill.

•

Continued to provide sound environmental compliance information to requesting
departments.

The Division recognizes that environmental risks are capable of being managed through risk
control and prevention measures. These measures include separation of hazardous materials,
effective pollution prevention and loss control techniques, redundant controls and safety
mechanisms, double and triple containment of tanks and flow tubes, emergency response plans,
and effective training of employees. The Division will continue to seek to implement these
measures.
IV-1

ADMINISTRATIVE DIVISION
The Administrative Division is responsible for procuring the insurance policies above the County’s
self-insured retention, providing certificates of insurance to County departments, preparing the
annual user charges for services, preparing the annual budget and financial statements for the Trust
and providing administrative support to the other divisions within the department. Included in this
report is a comparison of the assets and liabilities of the Trust over a three-year period, the trend of
the current insurance market, a budget summary and the financial statements through fiscal year
ended June 30, 2005.
Self-Insured Trust Fund
Combined Balance Sheet Comparison
FY02-03, FY03-04, and FY04-05

Assets
Liabilities
Net assets (deficit)

FY02-03
$29,287,214
$41,851,737
($12,564,523)

FY03-04
$34,064,513
$43,488,963
($ 9,424,450)

FY04-05
$39,013,788
$51,716,639
($12,702,851)

During the FY02-03 through FY04-05 period, the Trust’s assets increased $9,726,574 or 33.21%,
from $29,287,214 to $39,013,788. During the same period, the Trust’s liabilities increased
$9,864,902 or 23.57%, from $41,851,737 to $51,716,639. Net assets (deficits) are a result of a
spend down of the self-insured trust fund in a prior period, where user departments were only
charged for administrative costs while claims and insurance were still being paid by Risk
Management on behalf of these user departments. FY04-05 balance sheet details are provided in the
financial section. The Trust began billing user departments for the full costs of claims and insurance
in FY99-00.
Insurance Policies
Risk Management continues to analyze current insurance market trends. It is expected that
insurance premiums in all lines of coverage will increase somewhat, but the “hard” market of the last
few years may be abating. It is projected that potential increases in annual premium costs will not be
as great as in the past years. Risk Management will continue working closely with our insurance
broker to aggressively pursue reasonable insurance coverages to protect Maricopa County.
At the close of this fiscal year, the County’s major insurance policies are as follows:
Coverage

Policy Period

Limits

Deductible/SIR

General Liability
(Excess liability)

3-1-05/3-1-06

$5 million
$25 million

$5 million SIR

Medical Malpractice
(Excess liability)

12-4-04/12-4-05

$15 million
$10 million

$5 million SIR

V-1

Workers’ Compensation

7-1-04/7-1-05

$25 million

$1 million SIR

Property Damage

7-1-04/7-1-05

$200 million

$100,000 per occ.

Budget Summary
The expenditure budget for the Risk Management Department for FY04-05 was $26,070,716. Of
this amount, $1,324,639 was for personnel costs, $284,737 was for supplies and services, $21,000
was for capital equipment and $24,440,340 was for insurance, legal, and claims and claims related
expenditures. On a percentage basis, 93.75% of Risk Management’s budget is for insurance, legal,
and claims and claim related expenditures.
The revenue budget for the Risk Management Department for FY04-05 was $26,644,669. Of this
amount, $26,144,669 was from user charges and $500,000 was from interest earnings. On a
percentage basis, 98.12% of the revenue is from user charges. These user charges are based on
actuarially estimated claims payments and insurance projections for what the Risk Management
Department will pay out on behalf of County departments.
Financial Statements
The financial statements presented in this section have been audited by the State of Arizona, Office
of the Auditor General, and are included in the Maricopa County Comprehensive Annual Financial
Report (CAFR) and the Risk Management and Employee Benefits Trust Report on Audit of
Financial Statements for FY04-05.
The actual expenditures for the Risk Management Department for FY04-05 were $30,013,334. Of
this amount, $1,270,312 was for personnel costs, $260,784 was for supplies and services and
$28,482,238 was for insurance, legal, and claims and claims related expenditures. On a percentage
basis, 94.90% of Risk Management’s actual expenditures are for insurance, legal, and claims and
claims related expenditures.
The actual revenue for the Risk Management Department for FY04-05 was $26,734,933. Of this
amount, $25,973,357 was from user charges and $751,208 was from interest earnings. On a
percentage basis, 97.15% of the revenue was from user charges.

V-2

MARICOPA COUNTY
RISK MANAGEMENT AND EMPLOYEE BENEFITS TRUST FUNDS
Statements of Net Assets—Internal Service Funds
June 30, 2005
Risk
Management
Assets
Current assets:
Cash and cash equivalentsRisk management
Environmental insurance claims recovery
Employee benefits
Interest receivable
Accounts receivable
Prepaid insurance
Total current assets
Noncurrent assets:
Machinery and equipment
Less: accumulated depreciation
Total noncurrent assets
Total assets

Employee
Benefits

$ 35,864,889
1,154,502

1,804,757
38,996,242

$ 22,521,849
62,073
2,720,804
1,173,867
26,478,593

71,430
53,884
17,546
39,013,788

26,478,593

172,094

Liabilities
Current liabilities:
Accounts payable
Employee compensation payable
Unearned revenue
RBUC and IBNR claims
Total current liabilities
Noncurrent liabilities:
RBUC and IBNR claims
Total noncurrent liabilities
Total liabilities

1,117,861
108,227

Net Assets
Invested in capital assets
Unrestricted (deficit)
Total net assets (deficit)

20,149,947
21,376,035

309,947
4,080,935
4,992,009

30,340,604
30,340,604
51,716,639

4,992,009

17,546
(12,720,397)
$ (12,702,851)

See accompanying notes to financial statements.
V-3

601,127

21,486,584
$ 21,486,584

MARICOPA COUNTY
RISK MANAGEMENT AND EMPLOYEE BENEFITS TRUST FUNDS
Statements of Revenues, Expenses, and
Changes in Fund Net Assets—Internal Service Funds
Year Ended June 30, 2005
Risk
Management
Operating revenues:
Charges for services
County and employee premiums
Intergovernmental charges
Other income
Total operating revenues
Operating expenses:
Personal services
Supplies and services
Accounting and auditing fees
Actuary fees
Consulting and management fees
Brokers' fees
Claims administration service fees
Legal expenses
Workers' compensation taxes
Claims and insurance:
Auto liability claims paid
Auto liability RBUC and IBNR claims increase in estimate
Total auto liability
General liability claims paid
General liability RBUC and IBNR claims increase in estimate
Total general liability
Workers' compensation claims paid
Workers' compensation RBUC and IBNR claims increase in estimate
Total workers' compensation
Medical malpractice claims paid
Medical malpractice RBUC and IBNR claims increase in estimate
Total medical malpractice
Auto physical damage claims paid
Auto physical damage RBUC increase in estimate
Total auto physical damage
Property claims paid
Property RBUC decrease in estimate
Total property
Pharmacy claims paid
Pharmacy IBNR claims increase in estimate
Total pharmacy
Medical claims paid
Medical RBUC and IBNR claims decrease in estimate
Total medical

See accompanying notes to financial statements.
V-4

Employee
Benefits

$ 22,364,322
3,609,035
10,368
25,983,725
1,270,312
260,784
12,173
38,325
150,825
145,000
394,527
6,403,302
442,280

$ 35,773,275
6,373,968
58,216
42,205,459

2,299,248

333,947
414,569
748,516
2,398,938
4,258,746
6,657,684
3,621,819
630,825
4,252,644
1,318,214
2,703,663
4,021,877
229,694
34,341
264,035
62,787
(84,206)
(21,419)
13,849,111
397,720
14,246,831
13,292,425
(1,451,000)
11,841,425

(Continued)

MARICOPA COUNTY
RISK MANAGEMENT AND EMPLOYEE BENEFITS TRUST FUNDS
Statements of Revenues, Expenses, and
Changes in Fund Net Assets—Internal Service Funds
Year Ended June 30, 2005
(Continued)
Risk
Management
Dental claims paid
Dental IBNR claims decrease in estimate
Total dental
Short-term disability claims paid
Short-term disability IBNR claims increase in estimate
Total short-term disability
Wellness incentives paid
General medical IBNR claims decrease in estimate
Total general medical
Unemployment claims
General liability insurance premiums
Workers' compensation insurance premiums
Crime insurance premiums
Property insurance premiums
Malpractice insurance premiums
Stop loss insurance premiums
Depreciation
Total operating expenses

$

Employee
Benefits
$ 5,007,820
(45,000)
4,962,820
2,168,399
41,215
2,209,614
11,900
(1,150)
10,750

776,861
1,632,039
505,357
32,422
726,087
1,295,105
122,360

Operating income (loss)
Nonoperating revenues:
Investment income
Total nonoperating revenues

4,598
30,013,334

35,693,048

(4,029,609)

6,512,411

751,208
751,208

Income (loss) before transfers

(3,278,401)

Transfers from other County funds

432,990
432,990
6,945,401
7,545,007

Increase (decrease) in net assets

(3,278,401)

14,490,408

(9,424,450)

6,996,176

$ (12,702,851)

$ 21,486,584

Total net assets (deficit), July 1, 2004
Total net assets (deficit), June 30, 2005

See accompanying notes to financial statements.
V-5

MARICOPA COUNTY
RISK MANAGEMENT AND EMPLOYEE BENEFITS TRUST FUNDS
Statements of Cash Flows—Internal Service Funds
Year Ended June 30, 2005

Cash flows from operating activities:
Receipts from other funds
Other receipts
Payments for fees, supplies, and services
Payments for insurance claims
Payments for insurance premiums
Payments to employees
Net cash provided by operating activities
Cash flows from noncapital financing activities:
Cash transfers from other funds
Cash flows from capital and related financing activities:
Purchase of capital assets
Cash flows from investing activities:
Interest received on investments

Risk
Management

Employee
Benefits

$ 22,364,541
3,619,403
(7,580,318)
(8,742,260)
(4,289,980)
(1,267,472)
4,103,914

$ 34,834,643
6,742,131
(2,299,248)
(35,597,324)
(157,629)

7,545,007
(19,754)
712,623

413,796

4,796,783

11,481,376

32,222,608

11,040,473

$37,019,391

$ 22,521,849

$ (4,029,609)

$ 6,512,411

Net increase in cash and cash equivalents
Cash and cash equivalents, July 1, 2004
Cash and cash equivalents, June 30, 2005
Reconciliation of operating income to net cash
provided by operating activities:
Operating income (loss)
Adjustments to reconcile operating income to net cash
provided by operating activities:
Depreciation
Net change in RBUC and IBNR claims, noncurrent portion
Changes in assets and liabilities:
Increase in:
Accounts receivable
Prepaid insurance
Accounts payable
Employee compensation payable
Unearned revenue
RBUC and IBNR claims, current portion
Decrease in:
Accounts receivable
Accounts payable
RBUC and IBNR claims, current portion
Net cash provided by operating activities

4,598
3,621,540

(98,970)
266,898
2,840

(938,632)
(35,269)
309,947

4,336,398
219

$ 4,103,914

See accompanying notes to financial statements.
V-6

3,522,573

(1,267,669)
(1,058,215)
$ 3,522,573

MARICOPA COUNTY
RISK MANAGEMENT TRUST FUND
Statements of Revenues, Expenses, and
Changes in Fund Net Assets—Internal Service Fund
Budget and Actual
Year Ended June 30, 2005

Operating revenues:
Charges for services
Intergovernmental charges
Other income
Total operating revenues

Budget

Actual

$ 26,144,669

$ 22,364,322
3,609,035
10,368
25,983,725

26,144,669

Operating expenses:
Personal services
Supplies and services
Accounting and auditing fees
Actuary fees
Consulting and management fees
Brokers' fees
Claims administration service fees
Legal expenses
Workers' compensation taxes
Total auto liability
Total general liability
Total workers' compensation
Total medical malpractice
Total auto physical damage
Total property
Unemployment claims
General liability insurance premiums
Workers' compensation insurance premiums
Crime insurance premiums
Property insurance premiums
Malpractice insurance premiums
Depreciation
Total operating expenses

1,324,639
284,737
16,500
43,625
298,000
145,000
285,800
4,564,719
220,000
353,271
3,503,315
4,182,259
3,892,321
425,699
299,329
750,000
2,128,544
609,958
55,000
970,000
1,718,000
26,070,716

Operating loss

1,270,312
260,784
12,173
38,325
150,825
145,000
394,527
6,403,302
442,280
748,516
6,657,684
4,252,644
4,021,877
264,035
(21,419)
776,861
1,632,039
505,357
32,422
726,087
1,295,105
4,598
30,013,334

Variance
$

(3,780,347)
3,609,035
10,368
(160,944)
(54,327)
(23,953)
(4,327)
(5,300)
(147,175)
0
108,727
1,838,583
222,280
395,245
3,154,369
70,385
129,556
(161,664)
(320,748)
26,861
(496,505)
(104,601)
(22,578)
(243,913)
(422,895)
3,938,020

(4,029,609)

Nonoperating revenues:
Investment income
Total nonoperating revenues

500,000
500,000

Loss before transfers

751,208
751,208
(3,278,401)

Transfers from other County funds
Decrease in net assets

(3,278,401)

Total net deficit, July 1, 2004

(9,424,450)

Total net deficit, June 30, 2005

$ (12,702,851)

See accompanying notes to financial statements.
V-7

251,208
251,208

MARICOPA COUNTY
RISK MANAGEMENT AND EMPLOYEE BENEFITS TRUST FUNDS
Notes to Financial Statements
June 30, 2005

NOTE 1 - Summary of Significant Accounting Policies
The County, in the exercise of the authority granted by Arizona Revised Statutes (A.R.S.)
§11-981, has established a trust fund and declares itself self-insured. For financial statement
presentation purposes, the Self-insured Trust Fund is reported as Risk Management and
Employee Benefits Trust Funds (Funds) and all monies held in these Funds are considered
unrestricted. The Funds’ financial statements are prepared in conformity with U.S. generally
accepted accounting principles applicable to governmental units adopted by the
Governmental Accounting Standards Board (GASB). The Maricopa County Comprehensive
Annual Financial Report for the year ended June 30, 2005, will report the Funds as
governmental activities on the government-wide financial statements since they
predominantly service the County’s governmental funds. A summary of the Funds’ more
significant accounting policies follows.
During the year ended June 30, 2005, the Funds implemented the provisions of GASB
Statement No. 40, Deposit and Investment Risk Disclosures. GASB Statement No. 40
establishes and modifies the risk disclosures about the Trust Funds’ deposits and
investments. The implementation of GASB Statement No. 40 requires only additional
disclosures, and had no effect on reported cash and cash equivalents, net assets, or changes in
net assets.
A.

Reporting Entity

The Funds are accounted for as internal service funds of Maricopa County, Arizona, under
the direction of an administrator appointed by the County Board of Supervisors. In addition,
the Funds are administered by no less than six joint trustees, all of whom shall be citizens of
the United States of America and residents of Maricopa County. The County Board of
Supervisors also appoints the trustees. However, the ultimate financial accountability for the
Funds remains with the County. The County is responsible for the management and
operations of the financing of the uninsured risk of loss related to torts; theft of, damage to,
and destruction of assets; errors and omissions; injuries to employees; natural disasters; and
for certain health benefits (pharmacy, medical, dental, short-term disability, medical
incentives, and wellness incentives) to eligible employees and their dependents.
B.

Fund Accounting

The Funds’ accounts are maintained in accordance with the principles of fund accounting to
ensure that limitations and restrictions on the Funds’ available resources are observed. The
principles of fund accounting require that resources be classified for accounting and
reporting purposes into funds in accordance with the activities or objectives specified for
those resources. Each fund is considered a separate accounting entity, and its operations are

V-8

MARICOPA COUNTY
RISK MANAGEMENT AND EMPLOYEE BENEFITS TRUST FUNDS
Notes to Financial Statements
June 30, 2005

accounted for in a separate set of self-balancing accounts that comprises its assets, liabilities,
net assets, revenues, and expenses.
The Funds’ financial transactions are recorded and reported as internal service funds since
their operations are financed and operated in a manner similar to private business enterprises.
The intent of the County Board of Supervisors is that the costs (expenses, including
depreciation) of providing goods or services to other departments within the County on a
continuing basis be financed or recovered primarily through user charges.
C.

Basis of Presentation and Accounting

The financial statements include statements of net assets; statements of revenues, expenses,
and changes in fund net assets; and statements of cash flows.
The statements of net assets provide information about the assets, liabilities, and net assets of
the Funds at the end of the year. Assets and liabilities are classified as either current or
noncurrent. Net assets are classified according to the availability of assets to satisfy the
Funds’ obligations. Invested in capital assets represents the value of capital assets, net of
accumulated depreciation. Unrestricted net assets represent the balance of monies held in the
Funds.
The statements of revenues, expenses, and changes in fund net assets provide information
about the Funds’ financial activities during the year. Revenues and expenses are classified as
either operating or nonoperating, and all changes in net assets are reported. Generally,
charges for services and insurance premiums are considered to be operating revenues. Other
revenues such as investment income are not generated from operations and are considered to
be nonoperating revenues. The cost of services, administrative expenses, and depreciation
on capital assets are considered to be operating expenses.
The statements of cash flows provide information about the Funds’ sources and uses of cash
and cash equivalents during the year. Increases and decreases in cash and cash equivalents
are classified as either operating, noncapital financing, capital financing, or investing.
Basis of accounting relates to the timing of the measurements made, regardless of the
measurement focus applied, and determines when revenues and expenses are recognized in
the accounts and reported in the financial statements. The financial statements of the Funds
are presented on the accrual basis of accounting using the economic resources measurement
focus. Revenues are recorded when earned and expenses are recorded at the time liabilities
are incurred, regardless of when the related cash flows take place.

V-9

MARICOPA COUNTY
RISK MANAGEMENT AND EMPLOYEE BENEFITS TRUST FUNDS
Notes to Financial Statements
June 30, 2005

The Funds apply only those applicable Financial Accounting Standards Board Statements
and Interpretations issued on or before November 30, 1989, Accounting Principles Board
Opinions, and Accounting Research Bulletins, unless those pronouncements conflict with
GASB pronouncements. The Funds have chosen the option not to follow FASB Statements
and Interpretations issued after November 30, 1989.
D.

Cash and Cash Equivalents

For purposes of the statements of cash flows, the Funds consider cash on hand, demand
deposits, cash on deposit with the County Treasurer, and only those highly liquid
investments with a maturity of 3 months or less when purchased to be cash equivalents.
E.

Machinery and Equipment

Machinery and equipment are capitalized at cost. Depreciation of machinery and equipment
is charged as an expense against operations. These assets are depreciated over their
estimated useful lives using the straight-line method. The estimated useful lives of
machinery and equipment range from 3 to 10 years.
F.

Employee Compensation Payable

Employee compensation payable consists of payroll and payroll-related costs incurred but
not paid at June 30, and personal time off (PTO) earned by employees based on services
already rendered. Employees may accumulate up to 240 hours of PTO, but any PTO hours in
excess of the maximum amount that are unused at calendar year-end will be transferred to
family medical leave (FML). FML benefits are used by employees for FML-qualifying
events and are cumulative but do not vest with employees and, therefore, are not accrued.
However, upon retirement, employees of the Funds with accumulated FML in excess of
1,000 hours are entitled to a $3,000 bonus. The amount of such bonuses is accrued in the
liability for employee compensation payable.
NOTE 2 - Deposits and Investments
Arizona Revised Statutes (A.R.S.) authorize the Funds to invest public monies in the State
Treasurer’s investment pool; obligations issued or guaranteed by the United States or any of
the senior debt of its agencies, sponsored agencies, corporations, sponsored corporations, or
instrumentalities; specified state and local government bonds; interest earning investments
such as savings accounts, certificates of deposit, and repurchase agreements in eligible
depositories; and specified commercial paper, bonds, debentures, and notes issued by
corporations organized and doing business in the United States. In addition, the County

V-10

MARICOPA COUNTY
RISK MANAGEMENT AND EMPLOYEE BENEFITS TRUST FUNDS
Notes to Financial Statements
June 30, 2005

Treasurer may invest trust funds in fixed income securities of corporations doing business in
the United States or District of Columbia.
Credit risk
Statutes have the following requirements for credit risk:
1. Commercial paper must be rated P1 by Moody’s investors service or A1 or better by
Standard and Poor’s rating service.
2. Corporate bonds, debentures, and notes must be rated A or better by Moody’s investors
service or Standard and Poor’s rating service.
3. Fixed income securities must carry one of the two highest ratings by Moody’s investors
service and Standard and Poor’s rating service. If only one of the above-mentioned
services rates the security, it must carry the highest rating of that service.
Custodial credit risk
Statutes require collateral for demand deposits, certificates of deposit, and repurchase
agreements at 101 percent of all deposits not covered by federal depository insurance.
Interest rate risk
Statutes require that public monies invested in securities and deposits have a maximum
maturity of 5 years and that public operating fund monies invested in securities and deposits
have a maximum maturity of 3 years. Investments in repurchase agreements must have a
maximum maturity of 180 days.
Deposits—At June 30, 2005, the carrying amount of the Funds’ deposits was $9,888,209,
and the bank balance was $10,084,342. The Funds follow the County’s policies requiring
collateralization of all deposits by at least 101% of the deposits not covered by depository
insurance. At a minimum, the collateral is to be held by the pledging financial institution or
its agent, but does not have to be held in the County’s name.
At June 30, 2005, the Funds’ bank balance was uninsured with collateral held by the
pledging financial institution in the County’s name. The deposits pertain totally to the
Employee Benefits Trust Fund.
Investments—The Funds’ investments at June 30, 2005, consisted of monies invested in the
Maricopa County Treasurer’s Investment Pool. The Funds’ investments in the pool represent
a portion of the County Treasurer’s pool portfolio. There is no oversight provided for the
County Treasurer’s investment pool, and the pool’s structure does not provide for shares.
The Funds’ portion in the pool is not identified with specific investments.
Credit Risk—The Funds follow the County’s policy to preserve the principal value and the
interest income of an investment. The County can invest in obligations issued or guaranteed

V-11

MARICOPA COUNTY
RISK MANAGEMENT AND EMPLOYEE BENEFITS TRUST FUNDS
Notes to Financial Statements
June 30, 2005

by the United States or any of the senior debt of its agencies, sponsored agencies,
corporations, or instrumentalities. The County can also invest in commercial paper and
corporate bonds with ratings that meet the statutory requirements specified above. At
June 30, 2005, the Funds’ investments consisted of monies invested in the Maricopa County
Treasurer’s Investment Pool which is unrated.
Interest rate risk—It is the County’s policy to hold investments to maturity, where practical,
and avoid any loss on investments resulting from an early sale or retirement of an
investment. Additionally, securities should be invested for a shorter duration, where
applicable. At June 30, 2005, the Funds had investments of $49,652,931 in the Maricopa
County Treasurer’s Investment Pool with a weighted average maturity of 440 days.
A reconciliation of cash, deposits, and investments to amounts shown on the Statements of
Net Assets follows:
Cash, deposits, and investments:
Cash on hand
Amount of deposits
County Treasurer’s Investment Pool
Total

$

100
9,888,209
49,652,931
$59,541,240

NOTE 3 - Liabilities for Unpaid Claims
The Funds provide for claims liabilities based on estimates of the ultimate cost of claims,
including future claims adjustment expenses, that have been reported but unpaid (RBUC),
and of claims that have been incurred but not reported (IBNR).
The County is liable for any single claim up to the insurance deductible or self-insurance
retention (SIR), whichever is applicable, and the excess over insurance limits.

V-12

MARICOPA COUNTY
RISK MANAGEMENT AND EMPLOYEE BENEFITS TRUST FUNDS
Notes to Financial Statements
June 30, 2005

The following insurance deductibles, self-insurance retentions, and insurance limits were in
effect during fiscal year 2004-05:
Policy Type
General and auto liability
Excess general and auto liability
Property/inland marine
Boiler and machinery
Earthquake
Flood zones except A and V
Flood zone A and V
Difference in conditions
Employee theft
Faithful performance of duty
Theft and robbery
Computer and wire transfer
fraud
Forgery alteration/property
Workers’ compensation
Employer’s liability
Medical malpractice
Excess medical malpractice

Deductible

SIR
$

$

5,000,000
primary

100,000
100,000
100,000
500,000
500,000
primary
100,000
100,000
10,000
100,000
10,000
1,000,000
5,000,000
primary

Limit
$

5,000,000
25,000,000
200,000,000
50,000,000
100,000,000
25,000,000
10,000,000
40,000,000
10,000,000
1,000,000
1,000,000
10,000,000
1,000,000
25,000,000
1,000,000
15,000,000
10,000,000

Settled claims have not exceeded the above commercial insurance coverage limits over the
past 3 years.
Risk Management Trust Fund
Liabilities for unpaid claims are estimates of the ultimate cost of claims that include the
insurance deductible, the SIR, and the excess over insurance limits. The estimates are
determined by an independent actuary using the following actuarial methods: reported loss
development, paid loss development, Bornhuetter-Ferguson reported loss and paid loss,
frequency times severity, case outstanding loss development, expected loss, incremental
paid-workers’ compensation, paid allocated loss adjustment expense to paid loss
development, and tail liability for medical malpractice. Total liabilities are equal to the sum
of:
1. Reported but unpaid claims (RBUC), which represent the estimated liability on reported
claims established by the Risk Management department and

V-13

MARICOPA COUNTY
RISK MANAGEMENT AND EMPLOYEE BENEFITS TRUST FUNDS
Notes to Financial Statements
June 30, 2005

2. Incurred but not reported (IBNR) reserves, which include known loss events that are
expected to become claims and expected future development on claims already reported.
Therefore, IBNR is largely an estimate of loss and claim adjustment expenses associated
with future likely claims activity based on historical actual results that establish a reliable
pattern.
Accrued actuarial liabilities are based on a discounted 55 percent confidence level assuming
a 3.0 percent annual rate of return on investments.
The total liabilities reported at June 30, 2005, categorized by RBUC and IBNR by insurable
area follow:

Auto liability
General liability
Workers’ compensation
Medical malpractice
Auto physical damage
Property
Total

$

RBUC
348,312
19,035,507
7,999,414
5,902,484
166,284
281,302

$

IBNR
518,215
6,737,997
2,044,906
7,456,130

Total Liabilities
$
866,527
25,773,504
10,044,320
13,358,614
166,284
281,302
$ 50,490,551

The total estimates of unpaid claim liabilities of $50,490,551 at June 30, 2005, increased by
$7,957,938 from last year’s balance of $42,532,613. The areas that significantly increased
were general liability and medical malpractice.
Changes in the liabilities for unpaid auto, general, workers’ compensation, medical
malpractice, auto physical damage, and property claims follow:

Balance
July 1
2002-03
2003-04
2004-05

$ 41,677,379
41,047,771
42,532,613

Current-Year
Claims and
Changes in
Estimates
$ 5,907,531
8,992,628
15,923,337

Claims
Payments

Balance
June 30

$ (6,537,139)
(7,507,786)
(7,965,399)

$ 41,047,771
42,532,613
50,490,551

Of these liabilities, $20,149,947 were actuarially estimated to be paid within the next 12
months.

V-14

MARICOPA COUNTY
RISK MANAGEMENT AND EMPLOYEE BENEFITS TRUST FUNDS
Notes to Financial Statements
June 30, 2005

Employee Benefits Trust Fund
The liability for pharmacy (Coinsurance Plan), medical, dental, and short-term disability
claims as shown below is based on the fiscal year 2004-05 actuarial reports. The Consumer
Choice Plan portion of the liability for pharmacy is based on the unused portion of the
members’ pharmacy accounts administered by Walgreens Health Initiatives. The liability
for medical incentives as shown below is based on the contract with CIGNA HealthCare.
Accrued liabilities at June 30, 2005, for each insurable area follow:
Pharmacy
Medical
Dental
Short-term disability
Medical incentives
Total

$

692,720
2,117,000
455,000
216,215
600,000
$ 4,080,935

Changes in the liabilities for unpaid pharmacy, medical, dental, short-term disability, and
medical incentives claims follow:

Balance
July 1
2002-03
2003-04
2004-05

$ 794,084
2,446,904
5,139,150

Current-Year
Claims and
Changes in
Estimates
$ 13,182,511
24,840,807
33,271,440

Claims
Payments
$ (11,529,691)
(22,148,561)
(34,329,655)

Balance
June 30
$ 2,446,904
5,139,150
4,080,935

It is estimated that the June 30, 2005, liabilities balance of $4,080,935 will be paid within the
next 12 months.
NOTE 4 - Net Assets Deficit
The County Board of Supervisors elected not to fund the Risk Management Trust Fund’s
unpaid claims in fiscal years 1995-96 through 1998-99. Consequently, the Risk Management
Trust Fund only billed user departments for operating costs and administrative expenses for
those years. This resulted in a total net assets deficit of $23,321,519 at June 30, 1999.
Starting July 1, 1999, Risk Management began billing user departments for actuarially

V-15

MARICOPA COUNTY
RISK MANAGEMENT AND EMPLOYEE BENEFITS TRUST FUNDS
Notes to Financial Statements
June 30, 2005

determined claim estimates that are projected to be paid each fiscal year. As of June 30,
2005, the total net assets deficit has been reduced to $12,702,851.
NOTE 5 - Letter of Credit
On July 1, 2004, the County renewed its workers’ compensation insurance with a selfinsured retention of $1,000,000. As a result, the Industrial Commission of Arizona required
the County to secure an irrevocable letter of credit in the amount of $8.5 million with a
financial institution to cover unfunded workers’ compensation claims. During fiscal year
2004-05, the letter of credit had not been drawn upon. The letter of credit was renewed to
July 1, 2006.
NOTE 6 - Retirement Plan
Plan Description—The Risk Management Fund contributes to a cost-sharing multipleemployer defined benefit pension plan administered by the Arizona State Retirement System
(ASRS). Benefits are established by state statute and generally provide retirement, death,
long-term disability, survivor, and health insurance premium benefits. The System is
governed by the Arizona State Retirement System Board according to the provisions of
A.R.S. Title 38, Chapter 5, Article 2.
The System issues a comprehensive annual financial report that includes financial statements
and required supplementary information. The most recent report may be obtained by writing
the ASRS, 3300 North Central Avenue, P.O. Box 33910, Phoenix, AZ 85067-3910 or by
calling (602) 240-2000 or (800) 621-3778.
Funding Policy—The Arizona State Legislature establishes and may amend active plan
members’ and the Risk Management Fund’s contribution rates. For the year ended June 30,
2005, active plan members and the Risk Management Fund were each required by statute to
contribute at the actuarially determined rate of 5.7 percent (5.2 percent retirement and 0.5
percent long-term disability) of the members’ annual covered payroll. The Risk
Management Fund’s contributions to the System for the years ended June 30, 2005, 2004,
and 2003 were $56,705, $54,687, and $22,894, respectively, which were equal to the
required contributions for the year.

V-16

TOTAL
TOTALCOST-ALL
COST-ALLCLAIMS
CLAIMS
(PAID
OR
RESERVED)
(PAID OR RESERVED)
FY02-03 TO FY04-05
Auto Liability Paid
Auto Liability Reserved
Auto Physical Damage Paid
Auto Physical Damage Reserved
General Liability Paid

$7,000,000

Medical Malpractice Paid
Medical Malpractice Reserved
Property Damage Paid
Property Damage Reserved
W orkers’ Compensation Paid

$6,000,000

$5,000,000

$4,000,000

$3,000,000

$2,000,000

$1,000,000

$0

FY02-03

Auto
Liability
$ Paid

FY04-05

FY03-04

Auto
Physical
Damage

General
Liability

Medical
Malpractice

Property

Workers'
Compensation

TOTAL

$294,316

$490,614

$1,146,074

$1,015,250

$199,487

$4,439,076

$7,584,818

FY02-03 Open Reserves

$2,000

$7,410

$4,801,960

$846,510

$0

$1,443,802

$7,101,682

4

Total Incurred

$296,316

$358,228

$5,947,034

$1,861,760

$199,487

$5,882,878 $14,545,703

$ Paid
FY03-04 Open Reserves

$173,655

$449,499

$1,406,064

$360,803

$368,141

$2,778,073

$5,536,236

$7,289

$10,846

$5,177,347

$1,224,665

$11,750

$814,184

$7,246,081

Total Incurred4

$180,944

$303,763

$6,583,050

$1,585,468

$379,891

$ Paid

$119,359

$354,581

$60,774

$5,227

$23,454

$1,524,993

$2,088,389

FY04-05 Open Reserves

$23,768

$64,574

$1,602,998

$95,868

$0

$1,231,166

$3,018,374

4

$143,128

$336,875

$1,663,773

$101,095

$23,454

$2,756,159

$5,024,483

Total Incurred
Notes: 1.
2.
3.
4.

$3,592,256 $12,625,372

Dollars paid represents the amount paid for the year in which the event occurred and does not include RBNP or
IBNR reserves.
Amounts as valued on June 30, 2005, as reported by the RiskMaster system except for Workers’ Compensation
amounts as valued on June 30, 2005, as reported by the Pinnacle system.
Unemployment not included.
Total Incurred = $ Paid + Open Reserves-Total Recoveries

VI-1

TOTAL CLAIMS SUMMARY TABLE
FY02-03 TO FY04-05
FY02-03
Department

# Claims

FY03-04

$ Paid

# Claims

FY04-05

$ Paid

# Claims

$ Paid

ADULT PROBATION

49

$141,073

58

$90,594

61

$92,050

ANIMAL CONTROL

52

$29,387

50

$29,912

66

$31,795

CLERK OF THE COURT

16

$19,980

19

$25,270

19

$19,572

CORRECTIONAL HEALTH

47

$412,093

37

$35,777

34

$66,405

COUNTY ATTORNEY

33

$44,510

48

$43,222

30

$49,435

ELECTIONS

14

$50,357

24

$38,887

16

$1,426

ENVIRONMENTAL SERVICES

41

$138,077

32

$63,353

50

$44,503

EQUIPMENT SERVICES

14

$41,875

10

$6,485

10

$8,434

FACILITIES MANAGEMENT

41

$198,603

29

$156,374

36

$52,543

FLOOD CONTROL

32

$111,420

52

$108,895

23

$86,834

HUMAN SERVICES

55

$141,495

55

$102,018

51

$62,775

JUVENILE COURT

41

$178,406

51

$91,596

34

$25,248

LEGAL DEFENDER

1

$144,384

1

$2,738

0

$0

MARICOPA HEALTH SYSTEM

298

$1,441,410

308

$1,149,201

253

$330,070

MCDOT

161

$133,602

139

$98,599

204

$46,122

PARKS & RECREATION

22

$34,769

21

$34,331

22

$13,849

PLANNING & DEVELOPMENT

9

$24,644

7

$6,526

16

$36,205

PUBLIC DEFENDER

11

$41,028

20

$60,537

5

$620

PUBLIC HEALTH

28

$40,835

42

$35,856

27

$31,033

RECORDER

2

$52,575

5

$0

2

$3,597

SHERIFF

673

$3,950,996

678

$1,888,993

863

$809,348

TELECOM

5

$22,429

5

$13,304

5

$577

TRANSPORTATION

23

$124,610

26

$114,954

35

$66,169

TRIAL COURTS

42

$39,349

36

$42,427

20

$40,306

ALL OTHERS

91

$65,852

90

$1,296,387

272

$172,600

1843

$5,536,236

2154

$2,091,517

TOTALS

1801

$7,623,756

Notes: 1. Dollars paid represents the amount paid for the year in which the event occurred and does not include RBNP or IBNR
reserves. Due to lag time in resolution and payment of claims, the figures from FY02-03 give a truer picture as these
claims have had time to mature.
2. Amounts as valued on June 30, 2005, as reported by the RiskMaster system except for Workers’ Compensation
amounts as valued on June 30, 2005, as reported by the Pinnacle system.
3. Unemployment not included.

VI-2

TOTAL NUMBER OF CLAIMS
FY02-03 TO FY04-05
1200

1000

800

600

400

200

0
FY02-03

Automobile Liability
Medical Malpractice

FY03-04

FY04-05

Auto Physical Damage
Property

General Liability
Workers' Compensation

FY02-03

FY03-04

FY04-05

Automobile Liability

70

64

91

Auto Physical Damage

271

355

482

General Liability

504

442

501

Medical Malpractice

49

41

25

Property

48

71

16

Workers' Compensation

859

868

1039

TOTALS

1801

1841

2154

Notes: 1. Number of claims paid represents the amount of claims for the year in which the event occurred.
2. Amounts as valued on June 30, 2005, as reported by the RiskMaster system except for Workers’
Compensation amounts as valued on June 30, 2005, as reported by the Pinnacle System.
3. Unemployment not included.

VI-3

AUTO LIABILITY LOSS SUMMARY
FY02-03 TO FY04-05
FY02-03
Department

# Claims

FY03-04

$ Paid

# Claims

FY04-05

$ Paid

# Claims

$ Paid

ADULT PROBATION

2

$0

1

$0

3

$0

ANIMAL CONTROL

0

$0

2

$9,744

3

$3,260

CONSTABLES

0

$0

2

$3,612

0

$0

ELECTIONS

1

$3,231

0

$0

6

$1,200

ENVIRONMENTAL SERVICES

4

$14,898

1

$556

7

$28,218

EQUIPMENT SERVICES

0

$0

1

$1,750

0

$0

FACILITIES MANAGEMENT

3

$3,086

1

$1,226

1

$2,785

FLOOD CONTROL

4

$5,975

2

$3,579

2

$409

HOUSING

2

$3,752

0

$0

0

$0

HUMAN SERVICES

5

$2,005

3

$17,546

4

$5,201

JUVENILE COURT

0

$0

1

$0

0

$0

MARICOPA HEALTH SYSTEM

3

$4,388

2

$5,209

4

$17,563

MCDOT

5

$31,650

6

$4,564

17

$16,248

MEDICAL EXAMINER

0

$0

1

$394

2

$95

PARKS & RECREATION

1

$0

0

$0

2

$4,970

PLANNING & DEVELOPMENT

0

$0

0

$0

1

$2,521

PUBLIC DEFENDER

0

$0

1

$1,517

0

$0

PUBLIC HEALTH

1

$0

0

$0

1

$1,839

SCHOOLS

1

$0

0

$0

0

$0

SHERIFF

38

$225,331

40

$123,958

35

$33,537

SOLID WASTE MANAGEMENT

0

$0

0

$0

2

$74

TELECOM

0

$0

0

$0

1

$1,438

TOTALS

70

$294,316

64

$173,655

91

$119,359

Notes: 1. Dollars paid represents the amount paid for the year in which the event occurred and does not include RBNP or IBNR
reserves. Due to lag time in resolution and payment of claims, the figures from FY02-03 give a truer picture as these
claims have had time to mature.
2. Amounts as valued on June 30, 2005, as reported by the RiskMaster system.

VI-4

AUTO PHYSICAL DAMAGE LOSS SUMMARY
FY02-03 TO FY04-05
FY02-03
Department

# Claims

FY03-04

$ Paid

# Claims

FY04-05

$ Paid

# Claims

$ Paid

ADULT PROBATION

5

$3,197

6

$15,320

17

$28,747

ANIMAL CONTROL

6

$2,779

8

$2,741

13

$4,396

CONSTABLES

1

$1,990

5

$5,410

7

$85

COUNTY ASSESSOR

1

$500

2

$180

2

$0

COUNTY ATTORNEY

4

$4,270

5

$13,790

10

$2,603

ELECTIONS

3

$500

0

$0

7

$0

ENVIRONMENTAL SERVICES

11

$4,150

11

$7,074

35

$15,078

EQUIPMENT SERVICES

1

$344

3

$1,060

0

$0

FACILITIES MANAGEMENT

5

$5,959

4

$6,899

9

$6,802

FLOOD CONTROL

16

$66,315

22

$14,497

9

$6,946

HOUSING

4

$1,474

0

$0

0

$0

HUMAN SERVICES

13

$5,682

18

$23,638

24

$19,950

JUVENILE COURTS

6

$8,821

7

$5,769

4

$3,188

LEGAL DEFENDER

1

$1,676

0

$2,476

0

$0

MARICOPA HEALTH SYSTEM

10

$6,303

15

$4,066

15

$8,726

MCDOT

21

$71,259

29

$70,289

45

$21,127

MEDICAL EXAMINER

0

$0

4

$3,625

4

$1,938

PARKS & RECREATION

4

$10,739

4

$4,069

11

$1,895

PLANNING & DEVELOPMENT

3

$1,119

3

$2,083

7

$15,026

PUBLIC DEFENDER

2

$1,124

1

$0

0

$0

PUBLIC HEALTH

3

$580

13

$8,752

11

$500

$289,777

182

$242,908

242

$215,176

SHERIFF

148

SOLID WASTE MANAGEMENT

0

$0

1

$1,493

4

$0

TELECOM

2

$2,056

1

$8,966

2

$427

ALL OTHERS

1

0

11

4395.89

4

1970.21

$490,614

355

$449,499

482

$354,581

TOTALS

271

Notes: 1. Dollars paid represents the amount paid for the year in which the event occurred and does not include RBNP or IBNR
reserves. Due to lag time in resolution and payment of claims, the figures from FY02-03 give a truer picture as these
claims have had time to mature.
2. Amounts as valued on June 30, 2005, as reported by the RiskMaster system.

VI-5

GENERAL LIABILITY LOSS SUMMARY
FY02-03 TO FY04-05
FY02-03
Department

# Claims

FY03-04

$ Paid

# Claims

FY04-05

$ Paid

# Claims

$ Paid

ADULT PROBATION

1

$0

6

$0

3

$0

ANIMAL CONTROL

11

$4,850

11

$3,200

15

$0

BOARD OF SUPERVISORS

1

$0

2

$1,114,360

1

$0

CONSTABLES

4

$7,279

2

$0

0

$0

CORRECTIONAL HEALTH

5

$0

8

$12,945

1

$0

COUNTY ASSESSOR

3

$457

2

$0

0

$0

COUNTY ATTORNEY

11

$30,313

23

$9,729

3

$0

ENVIRONMENTAL SERVICES

6

$0

3

$0

3

$0

FACILITIES MANAGEMENT

9

$83,775

5

$143

11

$38,300

FLOOD CONTROL

2

$1,986

10

$44,510

3

$0

HUMAN RESOURCES

1

$0

2

$1,679

0

$0

HUMAN SERVICES

0

$0

4

$1,600

1

$0

JUVENILE COURT

3

$280

1

$0

0

$0

MARICOPA HEALTH SYSTEM

22

$33,834

20

$2,000

24

$4,328

MCDOT

133

$29,304

97

$18,484

141

$3,035

MEDICAL EXAMINER

3

$1,155

2

$625

1

$0

PARKS & RECREATION

5

$11,399

3

$195

2

$0

PUBLIC DEFENDER

9

$33,837

10

$21,024

4

$0

PUBLIC HEALTH

3

$0

9

$272

6

$1,397

RECORDER

1

$52,487

4

$0

0

$0

233

$850,930

194

SHERIFF

$175,298

269

$13,714

TOTAL COMP

1

$688

1

$0

0

$0

TREASURER

1

$1,500

0

$0

0

$0

TRIAL COURTS

13

2000

14

0

3

0

ALL OTHERS

23

$0

9

$0

10

$0

TOTALS

504

$1,146,074

$1,406,064

501

$60,774

442

Notes: 1. Dollars paid represents the amount paid for the year in which the event occurred and does not include RBNP or IBNR
reserves. Due to lag time in resolution and payment of claims, the figures from FY02-03 give a truer picture as these
claims have had time to mature.
2. Amounts as valued on June 30, 2005, as reported by the RiskMaster system.

VI-6

MEDICAL MALPRACTICE LOSS SUMMARY
FY02-03 TO FY04-05
FY02-03
Department

# Claims

FY03-04

$ Paid

# Claims

FY04-05

$ Paid

# Claims

$ Paid

CORRECTIONAL HEALTH

24

$340,003

16

$11,250

14

$5,227

MARICOPA HEALTH SYSTEM

24

$675,247

24

$349,553

10

$0

PUBLIC HEALTH

1

$0

1

$0

1

$0

TOTALS

49

$1,015,250

41

$360,803

25

$5,227

Notes: 1. Dollars paid represent the amount paid for the year in which the event occurred and does not include RBNP or IBNR
reserves. Due to lag time in resolution and payment of claims, the figures from FY02-03 give a truer picture as these
claims have had time to mature.
2. Number of claims paid represents the amount of claims for the year in which the event occurred.
3. Amounts as valued on June 30, 2005, as reported by the RiskMaster system.

VI-7

PROPERTY LOSS SUMMARY
FY02-03 TO FY04-05
FY02-03
Department

# Claims

FY03-04

$ Paid

# Claims

FY04-05

$ Paid

# Claims

$ Paid

ADULT PROBATION

5

$7,610

0

$0

0

$0

ANIMAL CONTROL

0

$0

1

$0

0

$0

BOARD OF SUPERVISORS DIST 1

1

$0

0

$0

0

$0

COUNTY ASSESSOR

0

$0

1

$0

0

$0

EMERGENCY MANAGEMENT

0

$0

1

$0

0

$0

ENVIRONMENTAL SERVICES

0

$0

3

$0

0

$0

FACILITIES MANAGEMENT

7

$66,128

6

$3,320

2

$1,975

FLOOD CONTROL

3

$11,190

4

$0

1

$0

HOUSING

4

$4,123

5

$93,022

0

$0

HUMAN RESOURCES

1

$0

0

$0

0

$0

HUMAN SERVICES

0

$0

3

$670

1

$0

JUVENILE COURT

3

$4,852

1

$1,636

0

$0

LEGAL ADVOCATE

1

$3,016

0

$0

0

$0

LIBRARY

1

$0

1

$5,114

0

$0

MARICOPA HEALTH SYSTEM

1

$30,293

1

$99,000

0

$0

MCDOT

2

$1,388

7

$5,262

1

$5,711

MEDICAL EXAMINER

1

$0

2

$1,084

0

$0

PARKS & RECREATION

2

$3,910

8

$8,282

0

$0

PLANNING & DEVELOPMENT

1

$0

0

$0

0

$0

PUBLIC HEALTH

2

$14,220

3

$0

2

$0

SHERIFF

8

$29,700

23

$150,436

9

$15,768

TELECOM

3

$20,373

1

$316

0

$0

TRIAL COURTS

2

$2,683

0

$0

0

$0

TOTALS

48

$199,487

71

$368,141

16

$23,454

Notes: 1. Dollars paid represents the amount paid for the year in which the event occurred and does not include RBNP or
IBNR reserves. Due to lag time in resolution and payment of claims, the figures from FY02-03 give a truer picture
as these claims have had time to mature.
2. Amounts as valued on June 30, 2005, as reported by the RiskMaster system.

VI-8

WORKERS’ COMPENSATION LOSS SUMMARY
FY02-03 TO FY04-05
FY02-03
Department

# Claims

FY03-04

$ Paid

# Claims

FY04-05

$ Paid

# Claims

$ Paid

ADULT PROBATION

36

$130,266

45

$75,274

42

$63,719

ANIMAL CONTROL

35

$21,759

28

$14,228

40

$24,492

ASSESSOR

0

$9,994

5

$19,209

7

$14,518

CLERK OF THE COURT

16

$19,980

19

$24,113

19

$18,729

CORRECTIONAL HEALTH

18

$72,090

12

$11,581

23

$67,988

COUNTY ATTORNEY

18

$9,927

20

$19,702

24

$49,954

ELECTIONS

5

$46,626

24

$38,887

3

$226

ENVIRONMENTAL SERVICES

20

$119,028

14

$55,722

8

$7,774

EQUIPMENT SERVICES

12

$41,531

6

$3,531

9

$8,434

FACILITIES MANAGEMENT

17

$39,654

13

$100,420

15

$5,466

FLOOD CONTROL

7

$25,954

14

$90,818

10

$79,109

HUMAN RESOURCES

2

$17,839

2

$152

4

$2,984

HUMAN SERVICES

37

$94,869

27

$58,564

35

$46,111

JUVENILE COURT

29

$164,453

41

$84,192

43

$36,535

LIBRARY

9

$142,707

3

$1,249

0

$0

MARICOPA HEALTH SYSTEM

238

$691,345

246

$689,372

228

$311,336

MCDOT

23

$124,610

26

$114,954

43

$69,439

MEDICAL EXAMINER

9

$7,195

9

$6,719

8

$4,153

PARKS & RECREATION

10

$8,721

6

$21,785

7

$6,984

PLANNING & DEVELOPMENT

5

$23,525

3

$4,443

3

$18,657

PUBLIC DEFENDER

6

$6,068

8

$37,996

5

$2,071

PUBLIC HEALTH

18

$26,035

17

$26,832

21

$29,455

SHERIFF

246

$2,555,258

239

$1,196,394

349

$568,856

TRIAL COURTS

27

$34,666

20

$41,927

28

$48,806

ALL OTHERS

16

$5,039

21

$40,007

65

$39,196

TOTALS

859

$4,439,076

868

$2,778,073

1039

$1,524,993

Notes: 1. Dollars paid represents the amount paid for the year in which the event occurred and does not include RBNP or
IBNR reserves. Due to lag time in resolution and payment of claims, the figures from FY02-03 give a truer picture
as these claims have had time to mature.
2. Amounts as valued on June 30, 2005, as reported by the Pinnacle system.

VI-9

UNEMPLOYMENT LOSS SUMMARY
FY02-03 TO FY04-05

Department

FY02-03

FY03-04

FY04-05

$ Paid

$ Paid

$ Paid

ADULT PROBATION

$60,072

$51,796

$31,262

ALTCS

$25,111

$13,228

$7,326

ANIMAL CONTROL SERVICES

$39,197

$16,153

$6,722

CLERK OF SUPERIOR COURT

$44,176

$36,874

$32,444

CORRECTIONAL HEALTH

$33,879

$51,335

$25,812

COUNTY ASSESSOR

$2,978

$6,520

$10,051

COUNTY ATTORNEY

$28,485

$6,134

$10,393

$5,907

$2,787

$2,235

ELECTIONS

$11,894

$12,774

$22,854

ENVIRONMENTAL SERVICES

$10,982

$18,035

$23,114

FACILITIES MANAGEMENT

$24,601

$18,583

$27,411

$6,140

$6,270

$6,940

HUMAN SERVICES

$37,640

$66,386

$124,257

JUVENILE PROBATION

$33,456

$34,075

$35,903

$2,201

$6,855

$367

$236,571

$234,076

$216,764

$10,498

$31,829

$17,132

PARKS & RECREATION

$6,795

$1,393

$3,724

PUBLIC DEFENDER

$7,348

$9,518

$8,129

PUBLIC HEALTH

$18,875

$16,160

$25,879

RECORDER

$10,764

$4,892

$2,070

SHERIFF

$68,027

$64,525

$53,402

$3,234

$8,200

$7,420

TRIAL COURTS

$69,284

$51,299

$35,459

ALL OTHERS

$35,343

$32,276

$39,012

$833,459

$801,973

$776,082

COUNTY CALL CENTER

HOUSING

LIBRARY
MARICOPA MEDICAL CENTER
MCDOT

TELECOM

TOTALS

Notes: 1. Dollars paid represents the amount paid for the fiscal year. There are no reserves for unemployment.
2. Amounts as valued on June 30, 2005, as reported by the Advantage Financial System.

VI-10