05-D SCCA Contract - Laserfiche WebLink

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AGENDA INFORMATION SHEET PROJECT: Consider approval of an agreement for the City of Paris to be an assurer to the Sports Car Club of America (a private organization) for the Club's obligations to the Texas Military Facilities Commission with regard to a sports car rally at Camp Maxey. BACKGROUND: The City of Paris has been approached by the Lamar County Chamber of Commerce to approve and sign an agreement by and among the Texas Military Facilities Commission, the Sports Car Club of America, Lamar County, and the Lamar County Chamber of Commerce to allow the Sports Car Club to conduct its annual road rallies at Camp Maxey. The City is being asked to sign the agreement in the role of an assurer, meaning that ifthe Sports Car Club fails to meet its obligations under the agreement, the City, along with the Chamber and the County, will be called upon to fulfill those obligations. This arrangement was a requirement imposed by the Texas Military Facilities Commission during the course ofameeting ofthe Commission with representatives of the Lamar County Chamber of Commerce. The proposed agreement is included with the agenda materials. The responsibilities assumed by the City in signing this agreement are found under paragraph II C-F and paragraph VI C. Under the provisions of paragraph II C-F, the SCCA is obligated to restore all roads and other disturbed property at the club's expense and to reimburse the Commission and the AGD for their expenses incurred for use of their personnel for pre- and post-rally inspections of the premises. If the SCCA fails to meet this obligation, then the assurers, as a group, are obligated to assume those responsibilities and fulfill them on behalf of the club. I would point out there is no allocation among the assurers as to who would be the first entity obligated to step in for the club if the club fails to perform. Ifthe SCCA and the assurers fail to fulfill their commitments under subparagraphs C& D, then a$5,000.00 deposit will be utilized by the commission to defray these expenses. Although the contract does not indicate who will post the deposit, the Lamar County Chamber of Commerce has indicated it will provide such a deposit. With regard to the obligations assumed by the City under paragraph VI C, relative to the other obligations assumed by the City, this obligation is the most crucial. Under paragraph VI C, the assurers (again as a group) have agreed to indemnify and hold harmless the Commission and the AGD from the claims of persons or entities arising out of the conduct by the SCCA of the rallies authorized under the contract, to the extent allowed by the constitution and laws of the State of Texas. Again, the allocation of such potential liability among the assurers is not stated. Presumably, this obligation to step in and indemnify a private sports car club would be subject to paragraph II B in which the SCCA is obligated to obtain a general liability insurance policy in the amount of $5,000,000.00, naming the commission and the AGD as additional insured. However, because the level of liability for personal injury suits, including those involving automobile mishaps, in today's courts has resulted in enormous cash judgments, coverage of even $5,000,000.00 may be inadequate given a particular circumstance. To be certain of the City's position in this situation, the Legal Deparhnent forwarded a copy of the contract to the City's insurer, the TML Insurance Risk Pool to assess whether or not the City's coverage would apply to the obligations being assumed under this contract. The response from Ms.