Mandatory property, liability insurance discussed
By Bert Lehman
With several uninsured and damaged commercial buildings, the city of Clintonville is discussing requiring business owners to carry insurance on their buildings.
Clintonville City Administrator Chuck Kell shared with the Finance Committee at its Feb. 13 meeting a preliminary Application for Commercial/Business License and Certificate of Occupancy.
“We have a certification in here where they are certifying they have property and liability insurance on the building of a required amount as required by the city,” Kell said.
The amount of insurance hasn’t been set yet, Kell said.
The city would ask that the owner have proof of that insurance. Tenants would also be required to have rental and liability insurance.
“Then there will be a certificate of occupancy issued, and a fee associated with that,” Kell said.
The amount of this fee hasn’t been established yet.
Kell said the city could also issue a temporary certificate of occupancy if something relatively minor needs to be done in order to occupy the building. Once the required work is completed, a permanent certificate of occupancy would be issued.
A floor plan would also be required.
“It doesn’t have to be an engineered plan, but at least a floor plan that can be given to the fire department so they can see what kind of rooms and their uses are, and where the exits are,” Kell said.
Other information would include the number of employees on site, uses of the building, and emergency contact in case access to the building is needed.
Kell told the committee this is the start of the process to require business owners to have insurance. A city ordinance would also have to be adopted.
He also said Clintonville City Attorney Keith Steckbauer was researching the subject, verifying that the city has the legal authority to require insurance.
Finance Committee member Lance Bagstad said in his opinion, if the research shows there is no indication that the city is prohibited from requiring insurance, that the city has the right to require insurance.
“If there’s nothing that says we have no legal standing to not do it, just because somewhere else doesn’t do it, doesn’t mean it’s not the right thing to do,” Bagstad said.
He added that the city can’t continue to pay for the demolition of buildings because property owners don’t have insurance on them.
In addition to requiring property and liability insurance, Bagstad recommended requiring property owners to have a minimum amount of coverage. That amount would be determined.
“It’s going to at least cover the removal of a building instead of us covering the removal of somebody’s building when they don’t want to take care of it,” Bagstad said.
Committee member Jim Supanich agreed.
Kell told the committee that the city needs to decide how often it wants to review the certificates. He said to help ensure insurance coverage doesn’t lapse, an annual renewal should be required. He added that the fee for a renewal could be less than the initial fee.
Finance Committee Chairman Mark Doornink stressed that he didn’t want fees to be a revenue stream for the city.
“This is for public safety and the fee will cover administration costs,” Doornink said. “I don’t want it to be a lot.”
Bagstad said the city should consider a fee for businesses currently operating in the city differently than the fee for a new business coming to the city.
“So the first-time fee is really, really minimal for our current businesses, so there isn’t even a perception that it’s a money-making effort,” Bagstad said.
Kell asked the committee what the city should do if a current business doesn’t have the required insurance or the minimum amount required.
“Are we going to issue that permit or are we going to require them to have that insurance first?” Kell asked.
Bagstad said the city could issue a temporary certificate, and give the business a certain amount of time to acquire the required amount of insurance.
Supanich said current businesses would have to be given time to comply with the new requirements if and when they are adopted.
“What we’re trying to do is correct the wrongs that have existed, but we don’t want to correct them by taking people out of business in the process,” Bagstad said.
Kell will continue to work on the license and certificate forms as well as confer with Steckbauer. The Finance Committee will discuss it again at its March meeting.