EDITORIAL

A bad precedent

Posted 5/23/13

In their diligence to protect the taxpayers’ dollars, the City Council is shirking the city’s responsibility and may have unwittingly posted a sign for businesses to beware.

By a 5-3 vote with …

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EDITORIAL

A bad precedent

Posted

In their diligence to protect the taxpayers’ dollars, the City Council is shirking the city’s responsibility and may have unwittingly posted a sign for businesses to beware.

By a 5-3 vote with one abstention, the council denied a $708.84 claim from USAA Insurance. The company has a policy with a Warwick man whose parked car was hit by a Warwick Police cruiser.

Police do not dispute who is responsible for the accident, but

Ward 4 Councilman Joseph Solomon saw no reason to pay the claim, contending that the company assumed the risk when it wrote the policy, implying they can afford the money. Other council members pointed out that they have no way of knowing whether the amount sought is justifiable. They reasoned the council should have been provided [we are not making this up] with three bids for the repair work and council members also cited the past practice of claimants or a representative appear before the council. No representative from the insurance company was present.

The council action sets a dangerous precedent. The message it sends is that the city will deny payment for a claim even when the liability is clear.

While a minimum of three bids is a good requirement and safeguards the city from being unreasonably charged in most instances, to make it mandatory for situations like this would be cumbersome and costly. While a council member posits that it would be more expensive for the company to send someone before the council to make the claim than the claim compensates them, it sounds ethically shaky, like people who never bother to pay parking tickets for cities they don’t intend to return to, and an unseemly attitude for public officials.

We can imagine situations where obtaining three bids would be unwieldy and in some situations, further harm the claimant and the city. Would a homeowner whose roof has a hole because of a falling city tree be required to get three bids before he fixes the hole?

Requiring a claimant to appear before the council is not unreasonable under most circumstances, but not in this one. The insurance company can (and very well may) have its actuaries calculate the risks of insuring people who live in a city that doesn’t pay its bills without cumbersome procedures and practices.

How many companies thinking about moving to Warwick would be impressed with the council’s “penny-wise-pound-foolish” method of doing business?

The council, however, chose to worm its way out of payment and probably did a lot more damage than the $708.84 they think they saved taxpayers.

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