FYI:

Bylaw Amendments Approved

- Michael Hammond, Executive Director

Effective May 28, 2002, the proposed amendments to the MVRMA Agreement and Bylaws were ratified by two-thirds of the members. In fact, all 17 member city councils have now passed legislation to approve the amended document.

At the December 20, 2001 Quarterly Board Meeting, the Trustees approved deletion of the 10% New Member Fee contained in the bylaws. Since the bylaws were last amended in 1995, the Board agreed a complete review was in order. With the assistance of corporate legal counsel, Bob Surdyk, the staff completed a very thorough update of each section. A Bylaws Committee reviewed the proposed changes, made additional modifications and then recommended the final amendments to the MVRMA Board at the March 18, 2002 Quarterly Board Meeting. Trustees voted 15-0 in favor of recommending approval of the amendments to their respective legislative bodies.

The ratification was completed in less than three months. To assist with this process, I was invited to answer questions at six of our members' city council meetings. These meetings also provided an opportunity to discuss pooling and some of the important challenges ahead for MVRMA.

The purpose of the Agreement and Bylaws is "to establish and maintain a joint self-insurance pool under Chapter 2744.081 of the Ohio Revised Code for the public purpose of enabling the subscribing political subdivisions to obtain insurance coverage, to provide methods for paying claims, and to provide for a formalized, jointly administered self-insurance pool." It is intended the pool will provide these essential governmental functions for its members "at a cost, which is lower than would be obtainable, by the members acting separately."

back to top

Counselors' Comments

 - Dinsmore & Shohl

Ohio Supreme Court Limits Recreational Use and Sovereign Immunity Defenses for Fireworks Displays

In June of this year, the Ohio Supreme Court continued its assault on governmental immunity and concluded neither recreational use immunity nor sovereign immunity protected governmental entities involved in a fireworks display. Specifically, in Ryll v. Columbus Fireworks Display Co., Inc., 95 Ohio St. 3d, 467 (2002), the Court reversed a summary judgment which had been granted to the City of Reynoldsburg and Truro Township for the wrongful death of a spectator who was killed when shrapnel from an exploding shell hit him during a July 4th fireworks display.

In Ryll, the Ohio Supreme Court began with the ominous statement that "some members of this Court are on record as believing sovereign immunity to be an unconstitutional infringement of Section 16, Article 1 of the Ohio Constitution...This date, however, we will resolve the issue before us in favor of the appellants without addressing the constitutional issue." With that as a backdrop, the Court first ruled Ohio's "recreational use" statute did not apply because the injury came from an exploding fireworks shell (as opposed to being caused by the "premises" themselves), and the statute only immunizes an owner from a duty "To Keep The PREMISES safe for entry or use." According to the Court, "to hold otherwise would allow R.C. Section 1533.181 to immunize owners, lessees, and occupants for any of their negligent or reckless acts that occur on 'premises.'" Ryll at 469.

Having stripped defendants of any recreational use immunity, the Supreme Court went on to likewise rule there was no sovereign immunity applicable to the City of Reynoldsburg for its "sponsoring" of the fireworks display. Specifically, the Court ruled that "sponsoring" a fireworks display is a proprietary (as opposed to a governmental) function and that none of the Section 2744.02(B)(2) exceptions nor any of the Section 2744.03 defenses were applicable. Rather, the Court concluded that because evidence indicated the City of Reynoldsburg had designated a spectator viewing area closer to the discharge area than called for by NFPA Standards (the decedent was sitting in a roped off area approximately 667 feet from an exploding 12 inch shell, while NFPA Standards require safety areas "should be no closer than 840 feet from the discharge area of 12 inch shells"), it was for a jury to decide whether the City was negligent.

In addressing the potential liability of Truro Township, the Court did conclude the function of "inspecting" (as opposed to sponsoring) a fireworks display is a governmental (as opposed to a proprietary) function. However, the Court nevertheless concluded Section 2744.02(B)(3) provided an exception to the general rule of immunity because "Political subdivisions are liable for injury, death, or loss to person or property caused by their failure to keep...public grounds within the political subdivisions open, in repair, and free from nuisance." Applying this "exception" to the facts of Ryll, the Supreme Court concluded that although the Township did inspect the premises prior to installation of the fireworks as required by Section 3743.54, such an inspection "did not necessarily relieve Truro Township from liability for failure to keep Huber Park free from nuisance."

Truro Township knew there was going to be a fireworks display and knew that fireworks displays are potentially lethal. Nothing in the record indicates that Truro Township attempted to determine whether the safety rules required by R.C. Section 3743.53 were followed. Construing this evidence most strongly in favor of the nonmoving party, we cannot say as a matter of law that Truro Township kept the Huber Park free from nuisance.

While the Ryll Court's decision to deny both recreational use and sovereign immunity to the City and Township is itself disappointing, perhaps more troublesome is the majority's intimation that if given the opportunity, the Supreme Court may rule that Ohio's sovereign immunity statute is unconstitutional. Whether the constitutionality of the statute will be squarely addressed by the Court before the November elections (where at least two new Justices will be elected to the Ohio Supreme Court) remains to be seen.

back to top

The Claims File

- Craig Blair

This is the peak season for use of our members' recreational facilities. Analysis of the risks and exposures associated with skateboard parks, pools or recreation centers are generally explored prior to installation of these facilities. But, do we review the exposures of our open park areas? Even though Ohio Law provides our members with "Recreational Immunity" for damages or injuries within open parks, the courts could hold a city liable for lack of response to repair known hazards, such as damaged playground equipment. Playgrounds and exercise trails should be inspected at least quarterly.

The Ohio Revised Code defines a "Recreational User" as one who has permission to enter upon "premises" (i.e., parks) without payment of a fee or consideration. Keeping that in mind, the question becomes, "How far does Recreational Immunity go in protecting a city?" Our best answer is, "As long as entrance to the park is free and no fee or consideration of any type is required of the 'users,' recreational immunity will provide a defense against almost any type of claim for injury or damages."

The courts in Ohio have had conflicting opinions on the "payment of a fee" issue. Some courts ruled a fee or charge of any type (i.e., clean-up charge, reservation deposit, etc.) resulted in the loss of recreational immunity. Another court stated when a shelter fee was paid, but the injury occurred in the open park area, recreational immunity was still in force.

A recent case in northern Ohio concerned a park which had no fee but posted a sign that stated "...this park is for use by city residents only." Because use of the park was restricted, the court ruled recreational immunity was not a valid defense. It is MVRMA's position that park areas not be restricted in any way by the use of fees or signage restricting park use.

We are sensitive to the loss of revenue from renting park shelters, but the legal protections of recreational immunity far outweigh the benefits of charging a fee. Please call the MVRMA office or refer to the MVRMA Handbook's "Park Shelter Reservation Fee Policy" if you have any questions.

back to top

Loss Control Lowdown

- Starr Markworth

Are You Committed to Your Safety Program?

I recently completed the 2002 Safety Performance Evaluation Checklist (SPEC) visits to each MVRMA member city and reached a disturbing conclusion. Of the seventeen member cities, only seven had active safety committees, a mere 41% of the membership. In order to receive SPEC points for its safety committee, a city must meet the MVRMA-specified criteria of including both line employees and supervisors, meeting at least twice each year and maintaining written agendas or minutes to document the subjects discussed.

"What is the purpose of establishing a safety committee?" you ask. The basic function is to help create and maintain all employees' active interest in safety in order to minimize accidents and exposures. Additionally, an effective safety committee will improve teamwork, productivity, communication and morale.

Some major functions of effective safety committees are:

l Identifying aspects of the workplace that are unsafe and recommending corrective action

l Meeting on a regular basis to discuss safety concerns

l Participating in the process of the investigation of accidents/incidents and dangerous occurrences

l Developing safety policies, procedures and handbooks

l Promoting health and safety programs, policies and training

l Safety planning for the organization when new processes, equipment, facilities, etc. are being added

Management and employees share an equal concern for accidents and injury prevention; therefore, it is in everyone's best interest to participate in an active safety program, including a safety committee. When employees are included in the decision-making process, there is a greater buy-in to the overall safety program. Greater buy-in improves communication, trust and teamwork, which improves committee effectiveness and eventually improves safety performance.

Safety committees in various forms have been around for many years. With proper direction and management support, they can continue to fill a valuable role in assisting management with safety and health responsibilities.

If you would like some assistance in creating a citywide safety committee, revitalizing an existing committee or more information on safety committees, please contact me at 937/438-8878.

back to top

Brokers Beat

- Marsh USA Inc.

Public Official Bonds and MVRMA's Philosophy

Whether appointed or elected, individuals who hold public office have a duty and obligation to perform responsibly and in good faith and to protect the public interest. Local laws generally hold public officials personally accountable for any losses, shortages or damage to public property. Public officials may also be liable vicariously through their subordinates.

These performance obligations are usually affirmed during the oath process. In addition, it is common to require these individuals to indemnify themselves by either the placing of an insurance policy or an individual public official bond.

The public official bond is a guarantee the official will uphold his oath to faithfully and honestly execute his duties and responsibilities. If an elected official does not fulfill his duties, he may be liable for damages, hence the need for an indemnification process. If a third party bond or policy is not in place, the public official must make personal restitution to the extent of his liability for damages.

The list of those public officials who may need indemnification could be very lengthy. The following positions usually are in need of some type of coverage: city managers, commissioners, treasurers, purchasing agents, finance directors, judges, auditors, clerks and accountants.

MVRMA has in place a sound risk management program to protect its members' officials from this exposure. First, MVRMA places Public Officials insurance coverage on a broad basis. This coverage actually eliminates the need for most individual bonds. However, should bonds be required by charter, ordinance or other statutory requirement, they will be furnished as part of MVRMA's normal coverage to members.

With this program in place, the public officials serving MVRMA cities can confidently perform their duties knowing their personal assets are protected through a sound indemnification program.

back to top

From the Board Room...

At the June 10 Quarterly Board Meeting, the following actions were taken:

- Approved inclusion of non-appraised property when calculating the Pool Contribution Factor, effective with the 2003 Preliminary Budget

- Authorized the Executive Director as statutory agent for MVRMA with the Secretary of State

- Approved paying up to $25,000 for an excess flood policy effective 7/1/02 and approved developing an internal MVRMA policy to address uncovered issues in the future

- Approved the selection of Marsh Inc. as MVRMA's Broker

- Approved the 2002 Awards Program as presented by the Awards Committee

- Approved amending the 2002 Objectives to more accurately define the responsibilities of the Loss Control Manager. Rather than obtaining a defensive driver training certification, the Loss Control Manager will plan and facilitate the training, schedule the instructors and arrange site locations.

- Approved the amended Actuarial Report for the year ended December 31, 2001

- Approved the Financial Audit for the year ended December 31, 2001

- Approved a 5% increase for the Executive Director

- Approved amending the Personnel & Compensation Policy to allow the Executive Director, with the approval of the Personnel & Compensation Committee, to set the car allowance for the Claims Manager and Loss Control Manager

- Authorized the Executive Director to complete an internal and external salary review for all MVRMA employees prior to preparation of the 2003 Preliminary Budget

back to top

2002 Awards Program