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Amendments to BICEP Agreements June 19, 2006 Page 2 of 3 bonded indebtedness, the BICEP Board has been diligently working to revise the "operating" documents to remove the now unnecessary and burdensome provisions related to bondholder protection. The goal of the Board is to replace the existing operating documents with new operating documents that ensure efficiency in handling claims and provide clarity in the obligations and rights of each City member in BICEP. with these goals in mind, and in consultation with the City Attorney, the amended and restated Joint Powers Agreement, along with the new operating documents, are being presented for your review and approval. These documents are intended to fully replace the existing Joint Powers Agreement and operating documents originally entered into in 1988, with one exception. That exception relates to how a charter member (i. e . , Huntington Beach, Oxnard, San Bernardino and Santa Ana)will continue to participate in the reserves for liability coverage created by the now- retired bonds. To this extent only and subject to the final disposition of all claims which occurred prior to the defeasance of the bonds, the terms and conditions of the existing Liability Risk Coverage Agreement would remain in force and effect. Otherwise, on or after July 1, 2004, the rights and obligations for coverage of any Member of BICEP would be controlled under the proposed operating documents, if approved. In drafting the new Joint Powers Agreement and each proposed new operating document, all member's City Attorney were consulted. The attached operating documents provide the following: . The Joint Powers Agreement and the proposed Bylaws will broaden the definition of "Member" from any "California city which has executed the Agreement (i.e., the Joint Powers Agreement)" to "any public agency as the term 'public agency' is defined by Section 6500 of the Joint Powers Law" (the Joint Exercise of Powers Act, Government Code Section 6500 et seq.). . The proposed Bylaws would include and change the eligibility criteria for admission to BICEP. . The proposed new Bylaws would clarify that the Board of BICEP has the authority to make substantive revisions to the operating documents and the terms and conditions of coverage for the Members. Each Member City continues to protect its individual interests through the City Council's designation of the representative to the Board. · Pursuant to the Bylaws, coverage for each Member of BICEP would be provided through a Memorandum of Liability Coverage and through various Risk Management Programs determined and authorized by the BICEP Board, which is a similar procedure in other such pools. 55A-2