The city of Gardner may insure its property and liabilities in a different way next year. Council members debated the merits of joining several other municipalities in a property and liability pool during a work session Aug. 8.
The city pools its resources with Midwest Public Risk to provide health care for its employees, and now MPR would like to create a similar pool for property and liability. Terry Norwood, president of MPR, couldn’t say how much the city might save under such a plan, but he told council members the pool would likely minimize costs in the future.
Council members agreed to take part in the concept last year, but Norwood said regulatory concerns sidelined the pool.
The pool would pay out on individual property and liability claims under $500,000, and an insurer would pay for more costly claims. Gardner’s contribution to the pool would be $250,000.
“This premium isn’t going to bounce around,” Norwood told the council.
Norwood said since Missouri municipalities already use the MPR pool, the pool already has more than $9.4 million available to pay on claims. Rather than an insurance adjuster determining what claims are paid, a board which includes shareholders from other municipalities in the pool would make those decisions.
Council members requested what the city budgeted for property and liability insurance in the past.
However, Melissa Mundt, interim-city administrator, said that wouldn’t be an apples-to-apples comparison, because the city used a brokerage to find insurance, and in a pool, the members themselves pay out on claims up to a certain point.
Last year, she said the city budgeted more than $313,000 for property and liability, and she anticipates higher costs next year.
“This is a good deal,” Mundt told the council. “Not just the cost, but the value of the added services.”
Norwood explained that members of the pool are offered legal services of up to three hours for each claim and the pool provides training in a variety of areas for city officials, including council members and the police.
In other business, council members:
• Reached a consensus to provide funding and in-kind services up to $5,000 to the Gardner Historical Museum and another $2,500 in funding to the Gardner Community Theatre.
Museum officials Laura McCarthy and Shirley Brown VanArsdale said the museum volunteers created the museum in 2002 to preserve Gardner’s history. In the past, city officials allocated $7,000 to the museum. The council used money from a tax on hotel stays at the Super 8 Motel in Gardner.
The tax at one time brought in about $50,000 each year, but new hotels one exit north and changing economic conditions lowered revenues to as little as $29,000. But the city has continued to provide at least $50,000 in funding each year. In the meantime, the city used reserves from the years when the city didn’t use the hotel tax to provide funding to the Gardner Area Chamber of Commerce, the theatre, the museum and Southwest Johnson County Economic Development Corporation.
However, council members seemed to reach a consensus to cut museum and the community theatre funding during a budget work session this spring.
“We’d like to ask that you find funds to help us,” Brown Van-Arsdale said.
She said more than 300 people visited the museum between October 2010 and April 2011, and many of those guests were from out of town.
Council members reversed their decision to cut funding to the museum on Monday night. In order to provide funds, they’ll use money in the hotel tax reserves. Mundt said at the current rates of funding, those reserves will be gone in 2017.
To additionally assist the museum, council members instructed staff to find up to $2,500 in in-kind donations. For example, city officials could opt to waive some of the museum’s utility fees.
• Decided to consider banning pit bulls within the city limits. Council members will vote on a ban at a meeting in December. The city’s existing code is not breed specific. Instead, vicious dogs are not allowed within city limits. Enforcement of the code is complaint-driven.
• Briefly reviewed an ordinance they will consider as part of the 2012 budget that will increase water rates by 3 percent and wastewater rates by 6 percent. The increase will add approximately $12 per year to the average homeowner’s water bill and $27 per year to the average customer’s wastewater bill.
Gardner City Council to consider joining property, liability pool