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Staff says policy cut leaves SAM coverage halved; recommends $20M purchase
Summary
Staff reported that this year's PACE policy reduced sexual-abuse-and-misconduct (SAM) coverage from $20 million to $10 million and recommended buying an additional $20 million in coverage for $45,000 to restore prior protection levels.
During the budget committee meeting, Shy Chapman, Director of Fiscal Services, told members that "In previous years, our PACE policy provided $20 million in SAM liability coverage. However, this year’s policy includes only $10 million in coverage." Chapman framed the change as new information that required an adjustment to the proposed 2025–26 budget.
To address the reduction, Chapman recommended buying an additional $20 million in SAM liability coverage at a cost of $45,000 and proposed increasing the Board of Directors' insurance expenditures line by that amount while reducing the ending fund balance by the same amount. Chapman noted that the change would not alter total expenditures but would reduce the unreserved ending fund balance from 7.56% to 7.37%, remaining above the board's 5% minimum.
