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Indian River County, Florida
<br />Notes To Financial Statements
<br />Year Ended September 30, 2018
<br />NOTE 18 - RISK MANAGEMENT - Continued
<br />General Liability, Property, Worker's Compensation and Medical - Continued
<br />Estimates for claims incurred but not reported are actuarially determined and recorded. Based on the
<br />actuary's report, $2,530,000 will be liquidated over the next twelve months.
<br />Changes in the fund's claim liability amount during the current and prior three fiscal years are as
<br />follows:
<br />Balance at Claims Balance
<br />Fiscal Year and Changes Claims at Fiscal
<br />Beginning in Estimates Payments Year End
<br />2014-2015 $ 8,226,545 $ 17,188,927 $ (17,237,952) $ 8,177,520
<br />2015-2016 8,177,520 17,953,550 (17,618,550) 8,512,520
<br />2016-2017 8,512,520 16,364,331 (16,621,851) 8,255,000
<br />2017-2018 8,255,000 21,400,694 (21,216,694) 8,439,000
<br />Included in the charges to other funds is an amount to fund future catastrophic losses not actuarially
<br />determined and at September 30, 2018, unrestricted net position of $22,844,067 has been designated for
<br />this purpose. The County has elected to accrue the larger of the discounted liability or undiscounted
<br />liability. At September 30, 2018, the undiscounted liability was the greater of the two amounts. The
<br />discount rate used in the calculation was 2%.
<br />NOTE 19 - COMMITMENTS AND CONTINGENCIES
<br />A. Litigation
<br />The County is involved in litigation regarding a zoning dispute and other matters, and may be required
<br />to pay damages at a future date. While the ultimate amount of damages is currently unknown,
<br />management has estimated that the amount is likely to equal or exceed $537,000. Accordingly,
<br />management has recorded an estimated liability in that amount in the financial statements.
<br />Various other suits and claims are currently pending against the County. It is impossible for the County
<br />to accurately quantify the exposure involved given the jury's latitude in assessing compensatory and
<br />punitive damages, and the court's latitude in awarding attorney's fees. The County intends to
<br />vigorously defend against these lawsuits and believes it has a good chance of prevailing on their
<br />merits.The County is contingently liable with respect to lawsuits and other claims incidental to the
<br />ordinary course of its operations. In the opinion of management and based on the advice of legal
<br />counsel, the ultimate disposition of lawsuits will not have a material adverse effect on the financial
<br />position of the County.
<br />B. Contracts and Other Commitments
<br />The County has various contracts and commitments outstanding at September 30, 2018. In the General
<br />Fund, contracts are for janitorial services, beach park landscape and custodial maintenance, legislative
<br />consulting services and external auditing services.
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