A contractor told the Rutherford County Budget, Finance and Investment Committee on May 8 that the county’s school bus contracts no longer include the group liability insurance that historically covered contractors, and that change could shift substantial financial risk onto each vendor.

The comment came during the committee’s public-comment period when Kim Erp of Las Casas addressed the committee about transportation contractors. Erp said the county had previously included liability insurance in the four-year contract and now that coverage is being excluded for the current contract cycle. “The liability insurance is on the children of Rutherford County Schools, which is over 30,000 children that ride the bus every day,” she said.

Why it matters: Contractors said individual firms — about 75 in the county, according to the comment — would be required to obtain their own liability insurance. Erp said the county previously established an RFP so the county would secure group coverage, and that a $4,000 per-contractor stipend (approximately $100 per bus per year) was included in the contract to help offset costs. She told the committee a group rate would almost certainly be lower than 75 separate policies and warned some contractors might decline to continue work if forced to assume the full liability themselves.

Erp said contractors feared risking personal or business assets: “You know, we’re risking our livelihood, our LLC assets, our homes, all of that to sign.” The committee did not take action during the meeting; the comment was received as public input.

What was said about next steps or constraints: During later discussion of insurance matters, staff said some insurance services must be procured through competitive bid and that a short-term extension of the existing policy would be complicated by procurement rules. The county’s insurance director said they had asked the current vendor whether the county’s bus coverage could be added into the countywide package and that the vendor declined. Staff added that an unplanned 90-day extension would likely conflict with bid-threshold procurement rules because the county must acquire insurance through an open competitive process.

The committee did not vote on any specific change to the school transportation contract or funding during the session. The comments were recorded for the committee’s consideration as staff and commissioners continue work on insurance and procurement for upcoming contracts.