Municipal governments are accustomed to promoting safety and managing risk related to traditional city and town functions such as police work, setting up work zones, and building maintenance. It is routine to access and leverage best practices, get employees the training they need to be prepared, and plan budgets accordingly.
With more outside-the-box activities – innovative town events, alternative energy systems, creative learning methods in schools, and other programs – careful consideration must be given to potential liability issues as well as long-term costs.
Potential exposures
When it comes to events, liability problems can arise anytime municipal property is involved, particularly when a festival or fair becomes an “official” city or town function. Vendor involvement, alcohol sampling, and participation by municipal employees – even when they are acting as volunteers on their own time – are all important factors to examine. If a visitor is overserved and gets into a vehicle accident, or if someone is injured on site, the municipality could potentially be liable for damages.
Sporting events and recreational leagues sponsored by a city or town are also areas where liability exposures can occur.
Many cities and towns are now exploring alternative energy programs through local installation of wind turbines and solar panels, either as direct sources for town buildings or as leases of municipal property to a utility company. Alternative energy programs can certainly yield efficiency and savings, but safety and risk management must be part of big-picture planning. If not, liability-associated costs could outweigh the return on investment.
Rooftop solar panels can affect electrical operations, snow and ice accumulation, and firefighter response procedures and safety (if, for example, a roof needs to be vented in case of a fire).
In the case of wind turbines, local residents have at times taken issue with associated noise, and the windmills can become a draw for mischievous – and potentially destructive – young neighbors.
Another area where exposures arise is in schools. In addition to getting more technologically savvy, schools are going way beyond traditional methods of teaching by incorporating overnight and even international field trips, onsite obstacle courses, pets in classrooms, and other imaginative activities. While they have a wide range of benefits and can help teachers illustrate a variety of different lessons, these outside-the-box teaching methods can also present new liability concerns that should – and can – be addressed.
Field trip accidents and obstacle course injuries can occur, and fish tanks in school classrooms can catch fire. In fact, fish tank fires, which are mostly caused by faulty maintenance practices, are a surprisingly common claim seen at MIIA.
Think through “what ifs”
Innovative strategies that help residents and improve quality of life – and, in cases such as alternative energy, have a positive impact on the city or town’s bottom line – are a cornerstone of modern municipal planning. Just as with more traditional functions of government, however, every possible “what if” should be fully thought through with regard to potential safety issues, bodily injury, structural damage, liability exposures, and associated costs.
Consider whether the municipality needs and wants to implement the program. Is it essential? Is it important to the local community and its residents? If the answer to these questions is “yes,” then determine whether there is a way to transfer risk to another party.
If alcohol is being served at an event, closely review vendor contracts and ensure that the vendors themselves will be held liable for overserved guests, rather than the municipal government entity. Post disclaimers where possible to mitigate liability.
One MIIA member town wanted to help local residents with their recovery efforts after a destructive tornado several years ago, so the town sponsored a website for locals to trade goods and services. The town effectively transferred risk by including a disclaimer on the website, noting that the town wasn’t liable for private deals made between individuals.
In cases where risk cannot be transferred, make plans to manage it. If a wind turbine installation is being planned, for example, budget for a fence around the structure and for “high voltage” signs to be posted to discourage vandalism. Also plan for regular professional maintenance.
For classroom fish tanks, hire an outside company to conduct regular maintenance checks, thereby managing risk and potentially transferring liability.
For streamlined handling of all scenarios, identify one well-qualified person on the municipal staff to act as a funnel for reviewing and approving all municipal contracts. This employee, preferably with legal and/or risk management experience, can take a close look at every document and proposed program to ensure that all details are considered – and that rogue contracts aren’t being signed by various departments.
Finally, be sure to contact your municipal insurance provider upfront to find out what is covered and what is not. In some circumstances, your provider may recommend securing additional coverage from a specialized insurer if needed. In the end, it is better to find out ahead of time that a program isn’t covered by your insurance plan, rather than being surprised after a problem arises.

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