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| 3 | 4 | | |
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| 4 | 5 | | SENATE CONCURRENT RESOLUTION |
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| 5 | 6 | | WHEREAS, Aransas County alleges that: |
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| 6 | 7 | | (1) Regional Pool Alliance is a distinct governmental |
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| 7 | 8 | | unit organized under the Interlocal Cooperation Act (Chapter 791, |
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| 8 | 9 | | Government Code), is engaged in the business of insurance by |
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| 9 | 10 | | providing risk pool insurance coverage to governmental entities, |
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| 10 | 11 | | and offered that coverage to Aransas County; |
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| 11 | 12 | | (2) Regional Pool Alliance promised its members |
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| 12 | 13 | | complete disaster recovery services, which included: |
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| 13 | 14 | | (A) filing insurance claims on behalf of its |
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| 14 | 15 | | members after a disaster; |
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| 15 | 16 | | (B) pursuing full payment of those claims; |
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| 16 | 17 | | (C) contracting directly with construction |
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| 17 | 18 | | contractors for the remediation, repair, and, if necessary, |
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| 18 | 19 | | reconstruction of damaged facilities; and |
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| 19 | 20 | | (D) ensuring satisfactory completion of |
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| 20 | 21 | | construction projects; |
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| 21 | 22 | | (3) Aransas County paid annual premiums, assessments, |
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| 22 | 23 | | fees, and surcharges to Regional Pool Alliance from 2012 through |
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| 23 | 24 | | 2022 in exchange for comprehensive insurance coverage for its |
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| 24 | 25 | | property and, through Regional Pool Alliance, was named as an |
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| 25 | 26 | | insured in various contracts with insurers or insurance carriers |
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| 26 | 27 | | for property and casualty insurance to cover losses, including |
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| 27 | 28 | | losses due to storm damage caused by natural disasters, such as |
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| 28 | 29 | | hurricanes; |
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| 29 | 30 | | (4) after Regional Pool Alliance collected premiums |
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| 30 | 31 | | from Aransas County, it issued an insurance contract that contained |
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| 31 | 32 | | coverages, property values, and terms of insurance; |
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| 32 | 33 | | (5) in 2017, Aransas County owned property consisting |
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| 33 | 34 | | of approximately 43 buildings, mobile equipment, and other personal |
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| 34 | 35 | | property located in Aransas County, Texas; |
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| 35 | 36 | | (6) the insured actual value of Aransas County's |
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| 36 | 37 | | buildings and contents was $37,742,009.00 in the policy that |
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| 37 | 38 | | covered losses beyond actual value to the cost of replacement; |
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| 38 | 39 | | (7) at 10:00 p.m. on August 25, 2017, Hurricane Harvey |
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| 39 | 40 | | made landfall as a Category 4 hurricane about five miles east of the |
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| 40 | 41 | | city of Rockport in Aransas County with wind gusts measured at 152 |
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| 41 | 42 | | miles per hour and made a second landfall in Aransas County three |
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| 42 | 43 | | hours later near the Copano Bay community of Holiday Beach; |
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| 43 | 44 | | (8) Aransas County experienced the highest storm surge |
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| 44 | 45 | | from Hurricane Harvey at 12.5 feet, and more than 15 inches of rain |
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| 45 | 46 | | fell in Aransas County in a single day; |
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| 46 | 47 | | (9) Hurricane Harvey is estimated to have caused $125 |
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| 47 | 48 | | billion in damage to the Texas coast as one of the costliest |
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| 48 | 49 | | tropical cyclones in United States history with extreme wind damage |
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| 49 | 50 | | in Aransas County, Nueces County, Refugio County, and the eastern |
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| 50 | 51 | | part of San Patricio County, as it destroyed approximately 15,000 |
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| 51 | 52 | | homes and damaged another 25,000 homes, with the most severe damage |
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| 52 | 53 | | in Aransas County; |
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| 53 | 54 | | (10) properties owned by Aransas County experienced |
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| 54 | 55 | | significant damage including: |
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| 55 | 56 | | (A) the complete destruction of the Aransas |
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| 56 | 57 | | County Courthouse and Aransas County Aquarium; |
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| 57 | 58 | | (B) devastating damage to Aransas County's |
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| 58 | 59 | | airport, which suffered the loss of almost all of its hangars; and |
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| 59 | 60 | | (C) severe damage to many other county buildings |
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| 60 | 61 | | and facilities; |
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| 61 | 62 | | (11) after Hurricane Harvey, Aransas County promptly |
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| 62 | 63 | | submitted its claim for damaged property to the insurers through |
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| 63 | 64 | | Regional Pool Alliance, which also submitted claims on behalf of |
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| 64 | 65 | | other entities that suffered damage and losses due to Hurricane |
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| 65 | 66 | | Harvey; |
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| 66 | 67 | | (12) Aransas County officials received information |
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| 67 | 68 | | from Regional Pool Alliance periodically, which led the officials |
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| 68 | 69 | | to believe Regional Pool Alliance was receiving the county's |
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| 69 | 70 | | proceeds from the insurance carriers and using the proceeds to |
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| 70 | 71 | | contract with construction contractors to rebuild Aransas County's |
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| 71 | 72 | | facilities damaged by Hurricane Harvey; |
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| 72 | 73 | | (13) in late 2021, contractors began complaining to |
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| 73 | 74 | | Aransas County that Regional Pool Alliance was not responsive and |
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| 74 | 75 | | was not paying bills for work performed on Aransas County's |
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| 75 | 76 | | property; |
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| 76 | 77 | | (14) Aransas County immediately reached out to |
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| 77 | 78 | | Regional Pool Alliance regarding these complaints, but Aransas |
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| 78 | 79 | | County's questions, including questions concerning when repairs |
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| 79 | 80 | | would be completed, how repairs would be paid for, and what |
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| 80 | 81 | | arrangements were being made with contractors, were not answered; |
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| 81 | 82 | | (15) by October 2022, a claims adjuster informed |
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| 82 | 83 | | Aransas County that Regional Pool Alliance had instructed the |
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| 83 | 84 | | claims adjuster not to provide any information or otherwise |
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| 84 | 85 | | communicate with Aransas County; |
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| 85 | 86 | | (16) in January 2023, in response to a direct question |
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| 86 | 87 | | from the county attorney's office of Aransas County, Regional Pool |
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| 87 | 88 | | Alliance informed Aransas County that there was no more money to |
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| 88 | 89 | | fund the repairs to Aransas County's facilities; |
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| 89 | 90 | | (17) Aransas County later learned that Regional Pool |
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| 90 | 91 | | Alliance submitted claims on all of the properties owned by various |
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| 91 | 92 | | governmental entities and damaged by Hurricane Harvey together and |
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| 92 | 93 | | received payments from the insurance carriers in large lump sums; |
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| 93 | 94 | | (18) Regional Pool Alliance made no effort to |
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| 94 | 95 | | segregate the funds received by project or even by governmental |
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| 95 | 96 | | entity, and funds paid by the insurance carriers for damages to the |
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| 96 | 97 | | Aransas County facilities were commingled with funds paid to |
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| 97 | 98 | | Regional Pool Alliance for damages to other governmental entities' |
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| 98 | 99 | | facilities along the Texas coast; |
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| 99 | 100 | | (19) now Regional Pool Alliance has run out of money to |
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| 100 | 101 | | reconstruct Aransas County's facilities and refuses to pay the full |
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| 101 | 102 | | value of Aransas County's claims; |
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| 102 | 103 | | (20) critical facilities in Aransas County remain |
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| 103 | 104 | | unfinished, and Aransas County faces a significant fiscal challenge |
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| 104 | 105 | | due to nonpayment of millions of dollars of insurance proceeds as a |
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| 105 | 106 | | result of Regional Pool Alliance's failure to provide the claims |
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| 106 | 107 | | services and disaster-recovery services it promised; |
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| 107 | 108 | | (21) additional Aransas County facilities, including |
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| 108 | 109 | | the courthouse annex, the county tax assessor-collector's office, |
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| 109 | 110 | | and the transfer station, were damaged by Hurricane Harvey but have |
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| 110 | 111 | | not been fully repaired, remediated, or replaced; |
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| 111 | 112 | | (22) the lack of fully operational county facilities |
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| 112 | 113 | | has hindered Aransas County's ability to provide governmental |
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| 113 | 114 | | services and facilities to people living in and visiting the |
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| 114 | 115 | | county; |
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| 115 | 116 | | (23) Regional Pool Alliance has been named as a |
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| 116 | 117 | | defendant in at least two lawsuits related to Hurricane Harvey and |
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| 117 | 118 | | has asserted that it is immune from suit as a distinct governmental |
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| 118 | 119 | | unit; and |
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| 119 | 120 | | (24) Aransas County seeks to adjudicate its claims |
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| 120 | 121 | | against Regional Pool Alliance arising from Regional Pool |
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| 121 | 122 | | Alliance's failures to carry out the services it promised to |
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| 122 | 123 | | Aransas County and to obtain recovery from Regional Pool Alliance |
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| 123 | 124 | | on behalf of Aransas County and its residents; now, therefore, be it |
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| 124 | 125 | | RESOLVED by the Legislature of the State of Texas, That |
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| 125 | 126 | | Aransas County is granted permission to sue Regional Pool Alliance, |
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| 126 | 127 | | and Regional Pool Alliance's governmental immunity to suit and from |
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| 127 | 128 | | liability is waived, with respect to any cause of action arising |
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| 128 | 129 | | from Regional Pool Alliance's conduct in connection with Aransas |
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| 129 | 130 | | County's losses from Hurricane Harvey, including a claim for: |
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| 130 | 131 | | (1) recovery under Chapter 134, Civil Practice and |
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| 131 | 132 | | Remedies Code; |
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| 132 | 133 | | (2) a violation of Chapter 541, Insurance Code; |
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| 133 | 134 | | (3) a violation of Chapter 542, Insurance Code; |
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| 134 | 135 | | (4) negligent undertaking; |
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| 135 | 136 | | (5) negligent misrepresentation; |
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| 136 | 137 | | (6) fraud; |
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| 137 | 138 | | (7) quantum meruit; |
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| 138 | 139 | | (8) unjust enrichment; or |
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| 139 | 140 | | (9) money had and received; and, be it further |
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| 140 | 141 | | RESOLVED, That the suit authorized by this resolution shall |
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| 141 | 142 | | be brought in Aransas County; and, be it further |
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| 142 | 143 | | RESOLVED, That Kathleen Hicks, Director of Administration |
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| 143 | 144 | | for Regional Pool Alliance, be served process. |
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