Maplewood's infighting raises insurance costs

Not strongly related to the smoking ban but Maplewood has sent "health inspectors" to threaten and allegedly try to intimidate the Rock Night Club for putting on "theater nights" in the past. The Minnesota Department of Health apparently "determined" without citing specific legal advice signed off by an attorney and in the absence of any signed opinion by the MN Attorney General's office that the "theater nights" were illegal. If the "smoke theater" provision is upheld on appeal there could potentially be legal actions against bars that claim that they have lost business after they were threatened by local officials. It's a "long shot" but if local officials credibly are accused in not using "due diligence" in following the word of MN DOH (IE: to you have a signed legal ruling or a signed opinion from the MN Attorney General's office. Don't count settlements yet but pending lawsuits affect the credit rating and insurance rates of a city.

Maplewood has plenty of other "issues" such as a former official that had a "no disparagement clause" in the work contract, but lawsuits make a city vulnerable to more lawsuits. Especially if challenged public officials should know the legal grounding of the laws or ordinances they are trying to enforce. If they claim they don't know this is a minor error but a request for a legal opinion on points (like vetting signed off by specif lawyers and or the MN Attorney General's office signed opinion). Public officials don't have to aid in a person defense but they have to justify the legality of the laws that they are enforcing. The lawyers paid by the government get paid to put thei signature behind legal opinions that the give when laws are enforced.

(Note: A prosecutor of course doesn't have to disclose their legal strategy, contacts, and such but the prosecutor does not make the initial ticketing, arrest or fine but they they don't make the initial complaint as an agent of the government. Greg Lang

Maplewood's infighting raises insurance costs
City's insurer, citing lawsuit expenses, boosts its rates and delivers a warning
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Article Last Updated: 04/08/2008 10:20:06 PM CDT

Fed up with the squabbling and rising cost to insure Maplewood, the League of Minnesota Cities gave the St. Paul suburb a stern and expensive reprimand Tuesday.
The league, which insures all but six Minnesota cities, had been considering dumping Maplewood's policies. On Tuesday, the league's board of directors agreed to offer a renewal to the city, but with stiff premium and deductible increases.
"The board's concern is the contentious and divisive situation out there," Pete Tritz, director of the League Insurance Trust, said, noting that the atmosphere at City Hall contributed to a spike in lawsuits.
The league fears that if the situation doesn't change in Maplewood, there could be more litigation.
The city's insurance agent, Arthur J. Gallagher Risk Management Services Inc., called a meeting Monday to spell out the league's position. A representative of Gallagher, which acts as middleman between the city and the league, cited examples of troubling City Council behavior.
League attorneys are upset the council has disregarded their warnings on such things as talking to the media about lawsuits and the people involved when told not to, said VeNita Schnebele, a Gallagher representative.
"You're all individuals; you're going to speak your mind," Schnebele said, "but at the same time we need to follow the attorney's advice."
Maplewood Mayor Diana Longrie took issue with the idea the city's insurer was threatening to revoke coverage or penalize the city based on what it considered "uncooperative" behavior.

"A council member ... expressed their opinion of somebody. Is that OK? I don't know. Is that protected by the First Amendment? I don't know," Longrie said. "But they're saying, 'We won't insure you if you speak your mind.' What speech is allowed? I don't know."
Longrie said she wants more information on how the league handles similar scenarios with other cities to determine whether Maplewood is being "singled out."
But league officials cite events of the past couple years as reason for concern. Four employment-related claims have been filed against the city since 2006; three have been settled. Former Human Resource Director Sherrie Le won her claim and a $185,000 award this year. And a land-use lawsuit is pending.
Litigation-related losses for the past year exceeded $1 million, Schnebele said.
That amount was big enough for the league to consider dropping Maplewood's insurance coverage — an unprecedented move. In the past 20 years, the league hasn't dropped any city, Schnebele said.
"And we don't want to be a pioneer in this area," she said.
The league's insurance coverage is the best option for the city, in terms of price and breadth of coverage, compared with the "standard market," Schnebele said. She urged the council to heed the league's warning.
The city's coverage is scheduled to expire June 30. Adjusted premiums under the new contract will be "123 percent of what the average city would be paying" and Maplewood's deductible will increase from $50,000 per claim to $200,000, Tritz said.
The League of Minnesota Cities' action is the latest blow to the city.
Last month, the Pioneer Press detailed financial problems facing Maplewood and its leaders, who have been engaged in a shifting power struggle. The city was behind on checking bank statements against city records, there was no way to weigh expenses because budget numbers hadn't been entered into the city's computers, and leaders did not know the current value of the city's fixed assets.
Acting City Manager Chuck Ahl said he has added staff to address those issues and progress is being made.
He assured Maplewood residents in a letter last week that funds have not been misappropriated, but that the state of the finances was a result of "the process of reporting and monitoring" in the city.
The state auditor's office responded to calls for an in-depth look into the city's books by meeting with Ahl and Finance Director Bob Mittet last week.
State Auditor Rebecca Otto said Tuesday the state will "be monitoring their current situation," but won't perform an audit.
Tritz said the league's board weighed the city's recent efforts to fix its problems.
"If all hope were lost, the board would not have offered renewal," he said of the insurance coverage.
Elizabeth Mohr can be reached at 651-228-5162.