May 10, 1999

To:North York Community Council

From:Joe Halstead Commissioner Economic Development, Culture and Tourism

Subject:Insurance/Liability Requirements for Special Occasion Permits

Purpose:

The purpose of this report is to present the findings of the Departmental review of the Liability Insurance Coverage required for Special Occasion Permits as directed by North York Community Council. Based on the findings of that review, the Department is requesting that Council reconsider its recent amendment to liability coverage of $1M and return the minimum requirement to $2M.

All other normal conditions and requirements would apply to Special Occasion Permits as per previous City of North York policy and the Municipal Alcohol Policy.

Source of Funds:

Apart from the fee of $50.00 charged for Special Occasion Permits and payment of costs for expenses incurred during such events, the Department is requesting that groups obtaining these permits purchase liability insurance of $2M coverage naming the City as additional insured.

Recommendations:

It is recommended that:

1.the required amount of liability insurance coverage for Special Occasion Permits be reverted back to $2M which has been the policy and routine practice of the Department;

2.the groups provide proof of liability insurance coverage in the amount of $2M naming the City as additional insured;

3.this policy be harmonized city-wide;

3.any group seeking approval for a Special Occasion Permit obtain a Special Occasion Permit (S.O.P.) from the Liquor Licensing Board of Ontario;

4.the groups be charged the approved Special Occasion Permit fee of $50.00 and for goods and services not readily available at the site;

5.all bartenders and servers be required to attend a Server Intervention Training Program at the group's expense; and

6.appropriate City officials be directed to carry out all things necessary thereto.

Background:

Each year the Department, North District (formerly North York) receives requests from various groups for Special Occasion (Beer Gardens) Permits to compliment their community events. The Liquor License Board of Ontario requires that events of this nature be granted approval by City Council.

At its March meeting, Council approved an amendment to the required level of insurance liability coverage from the past and present practice of $2M to $1M. The Council also directed the Commissioner to undertake a review of the Liability Insurance and report back to the North York Community Council. After reviewing the issue, the Department is requesting the coverage be returned to $2M.

Comments:

Special Occasion Permits involving the sale of alcoholic beverages bring with them special considerations and precautions. These permits are issued to compliment community events which are oftentimes held in support of charity fundraisers and community oriented initiatives. The Department wishes to balance these opportunities with appropriate parameters ensuring protection of all those involved.

Liability coverage showing the City of Toronto as a named insured is primarily in place to protect the City against all legal liability which might result from or arise out of granting such permission through a Special Occasion Permit. The liability coverage also protects the user group.

The Department has completed its review of the Liability Insurance for Special Occasion Permits. Consultation with Insurance and Risk Management of the City's Treasury and Financial Services Division indicates that the $2M coverage should be maintained for such events, that given the level of settlements possible if the Department were sued, the $2M coverage is prudent. They have advised that there is little difference in cost between $1M and $2M.

Insurance and Risk Management have developed the "User Group Liability Insurance Program" which offers reasonable premium rates to user groups for a variety of events and activities including those serving alcohol. The program is based on liability coverage of $2M, the amount they are recommending as the minimum requirement across all Districts of the City. The cost to the user to purchase this $2M liability coverage is actually a reduction from the previous rates charged in North York. The package is ready for use and can be implemented immediately. (Please see Appendix 'A')

Furthermore, a review of policies and procedures from the former Toronto municipalities and the Toronto and Region Conservation Authorities has shown that generally $2M is the acceptable minimum standard coverage for such events.

1. Toronto and Region $2M coverage requiredcurrent practice

Conservation Authorities

1. Torontogenerally $1M coveragecurrent policy and

(former municipality)required; do havepractice

prerogative to require

$2M with larger events

1. Metro$2M coverage requiredcurrent practice

(former municipality)

1. York$2M coveragecurrent policy and

(former municipality)practice

1. Etobicoke$2M coveragecurrent policy and

(former municipality)practice

1. Scarborough$1M coverage requiredcurrent policy and

(former municipality)(considering a harmonizedpractice

$2M approach)

1. East York$2M Coverage current policy and

(former municipality)practice

Conclusion:

Councillors were concerned about the cost to users of the parks that a $2M liability requirement would be prohibitive. Appendix 'A' illustrates the new cost structure is actually a 10% - 50% reduction in cost from 1998 rates.

Considering the general practice throughout the Greater Toronto Area is to require a minimum of $2M insurance liability coverage, and considering there is now a program developed by the City which offers $2M coverage at affordable rates to user groups, Council is encouraged to support the findings of the Department and return the required limit to $2M.

Contact Name:

Jim Bradley

Director of Parks and Recreation - North District

395-6054

Joe Halstead

Commissioner Economic Development, Culture and Tourism