From: Jane Kruse
Sent: Friday, October 26, 2007 4:03 PM
To: Bailey, Robert G.; firstname.lastname@example.org ; C.J. Dykhouse; Pavlick, Donna L.; McCubbin, Todd; email@example.com ; Martin, Alison; firstname.lastname@example.org
Cc: email@example.com; Joanie Chenault
Subject: Surety Bond for Treasurer
The Missourian article of October 24 included a comment from Alison that she had resigned when agency officials could not provide her with evidence that she was bonded. There appears to have been a misunderstanding by Alison. Les asked me to communicate with the board about this to clarify any confusion.
The statute does say that the treasurer is to furnish a surety bond. However, a surety bond guarantees the performance of the obligations of the treasurer for the protection of the agency, not for the protection of the treasurer. A surety bond is dependent on the strength of the person seeking to be bonded and a considerable amount of personal information is required to obtain such a bond. While strict compliance with the law would require a surety bond, as a practical matter, the coverage needed by the agency already exists.
The agency has two policies that provide coverage to you as board members. One policy is with MoPERM, which covers errors and omissions of public officials. (The Missouri Public Entity Risk Management Fund (MOPERM) is a self insurance fund offering public entities insurance coverage.) The coverage secures the performance of fiduciary duties by persons in positions of private or public trust. The policy states “Public Officials Errors and Omissions means any and all breaches of duty by the Covered Party arising from negligent action or inaction, mistake, misstatement, error, neglect, inadvertence, or omission by the Covered Party in the discharge of duties with the Member Agency.” The second coverage is through The Hartford and that policy covers employee theft, and the term “employee” is defined to include board members and officers. As a board member of Life and Work Connections, Inc., there is also Directors and Officers Liability Insurance through a separate policy with Philadelphia Insurance Companies.
We did provide copies of insurance policy language to Alison to document that each of you as board members and the agency have adequate coverage. We have applications for a surety bond at the agency; however, Alison chose to resign the position before we had the applications in hand. We are happy to provide the application to whoever is going to serve as treasurer, but to secure a surety bond the individual will have to personally make application as it requires knowledge of personal information not known to the agency The agency will pay for the surety bond, but cannot apply for and provide it.