Insurance coverage costs rise for school district

by Sean Dunlap

The Franklin County School District’s total costs associated with its comprehensive insurance renewal — excluding workman’s compensation coverage — will likely increase by about 10 percent during the upcoming budget year.

Hal Graves, representing FBBInsurance in Meadville, told the school board during its regular monthly business meeting on Tuesday, June 21 that much of the increase appeared to be tied to the district’s property holdings.

Graves noted the policy coverage for buildings was going up by $2 million compared to what was in place during the current budget year. He went on to say the district has roughly $41 million in coverage on all of its buildings on all campuses.

“(Providers) routinely come in and do a cost estimator to make sure you have sufficient coverage on your property,” Graves said.

The school system’s coverage package includes a wide range of insurance products, including general liability, all district vehicles, all buildings and contents (including computers), inland marine (floater), professional liability for school board members and cyber coverage policies.

Inland marine insurance is property coverage for material, products or equipment that moves or is transportable, and/or is instrumental in transportation or communications.

Additionally, Graves noted the cost of cyber coverage, which the district added to its insurance package a couple of years ago to address online hacking and cyberattacks, was expected to increase by around $2,000 — from $7,293 this year to slightly more than $9,000 for the 2023 budget year.

“We had a higher rate for renewal, but the program found it at a little bit of a cheaper rate,” Graves said of the district’s cyber coverage. “Even with less cost, the coverage is still in line with Mississippi School Board Association recommendations.”

The overall insurance proposal cost quoted by Graves was placed at $305,141.91, up by more than $28,000 from the $276,850 premium costs seen during the present budget cycle.

“That’s going from around $265,000 to $295,000 – excluding the cyber coverage,” Graves went on to say.

In a related matter, Graves said FCSD has deductibles totaling $10,000 for everything that could potentially happen to its property with the exception of a wind and hail incident, the deductible for which could run at a minimum of $50,000 or could be in the neighborhood of 2 percent of the damage total depending on the dollar value of the loss.

To this end, he noted insurers are offering a “buy-back” where the school district could bring its wind and hail damage deductible back to a flat $50,000, but the cost to take part in the program would drive insurance costs upwards by another $58,000-plus.

“This (coverage) was not available for us to offer last year, but it is there for you now,” Graves added. “The bottom line is you are susceptible to a big deductible if something bad happens. (The buy-back) is something new that has not been tested.”

Superintendent of Education Chris Kent pointed out the district would have to experience in the neighborhood of $3 million in wind and hail damages before the 2 percent deductible would kick in.

District 5 School Board representative Michael Coleman asked if Graves was looking for an answer related to the buy-back program during the meeting, but Graves said he believed the board could come back at a later date and consider the matter beyond its consideration of the coverage plan he was offering.

“I just think we need to talk about it because that would be a lot of money up front,” Coleman said.

With a coverage deadline approaching, board attorney Lane B. Reed said the panel could consider the approval of its primary insurance package with the possibility of coming back at a later date to consider the deductible buy-back proposal.

In the end the board agreed with the suggestion and unanimously approved the insurance proposal minus the buy-back.

In other action during the session, the Franklin County Board of Education considered these docket items:

• Heard the follow-up to a disciplinary matter involving an unidentified Franklin County School District student.

In April following a lengthy closed-door meeting, the student was ordered unanimously by the board to remain home-bound for the remainder of the 2021-2022 academic year while maintaining a C grade or better in academic classes and not to be on any Franklin County Schools campus through the end of the school year.

“He met your requirements, and, based on what you had told him if he met those requirements, then you may allow him to come back to school,” Kent told the panel.

The board voted to allow the student to return and he personally thanked school board members for their positive consideration of his readmission to school.

• FCSD Business Manager Tremel Young reported on the system’s statement of fund balance in its district maintenance account as of May 31, 2022, which stood at $2,254,365.78.

“As of May 31, we had completed 91 percent of our school year with district maintenance collecting 93 percent of its projected revenue and we have expended 80 percent of our projected expenses,” Young said.

In regards to cash flow from July 1 of last year to the end of May, 2022, Young said the district maintenance cash flow report was tabulated at $3,855,919.90.

• Hired Melissa Jenkins to serve as the new assistant principal at Franklin County Upper Elementary School. In a related matter, the board approved a recommendation for its 2022-2023 coaching staff along with pay supplements for those individuals based on the sports they oversee.

• Gave final approval to the FCSD student handbook for the 2022-2023 academic year with the booklet outlining policies and procedures to be distributed to every student at the start of the new school term.

• Announced plans to seek bids on surplus FCSD Transportation Department vehicles, which will include three buses and a truck.

• Returned a performance bond in the amount of $5,000 to LandMax Timber Co., in regards to a timber harvest in Section 16, Township 7 North, Range 4 East.

• Authorized advertising for hunting leases on school-district controlled properties – Section 16, Township 5 North, Range 3 East; Section 16, Township 6 North, Range 4 East; Section 33, and Township 5 North, Range 1 East.

• Adopted an order to change signature authority on Franklin County Lower Elementary School’s account through United Mississippi Bank following the appointment of Page Goff as principal.
• Approved requested trips for the Franklin County High School cheerleaders to attend a summer camp program at Southwest Mississippi Community College set for July 11-13 and for the Pride of Franklin County Band to travel to Dallas, Texas in May, 2023.

• Authorized the Franklin County High School Junior Reserve Officer Training Corps to host its haunted house fund-raiser at the historic armory on Main Street in Meadville on Oct. 27 and 28.