[Mpls] Bus Strike --- MCN says "Don't Take the Money"

[md]

MCN Member Advisory: 
Proposal to reimburse nonprofits for transportation costs during bus strike

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TO: Minnesota Council of Nonprofits members

FR: Jon Pratt, Executive Director, Sondra Reis, Associate Director

DT: Monday, March 15, 2004

RE: MCN Member Advisory: Proposal to reimburse nonprofits for transportation costs
during bus strike
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The Metropolitan Council has proposed short-term grants to nonprofits to provide
transportation during the metro area bus strike. Several Minnesota Council of Nonprofits
members have directed questions to MCN about legal, insurance, and public opinion issues
about this proposal. 

Clients and members of nonprofit organizations are having serious travel problems
as a result of the strike, including low and moderate income residents, immigrants, 
people with impaired vision, and others that have relied on public transportation. 
Many individuals and Minnesota charitable organizations are making extraordinary 
arrangements to help people without access to transportation.

While MCN has no formal position on the issues underlying current contract
negotiations between the Metropolitan Council and the transit union
(Amalgamated Transit Union Local 1005), MCN recommends against applying 
for funding for this purpose for three reasons:

1. Unresolved issues of liability, insurance coverage, and negative implications
for future insurability of organizations. Transportation services are expensive
risks to insure, and many Minnesota nonprofit organizations that use vans and
buses have experienced serious problems in finding and placing their casualty
and liability coverage for existing activities. 

Taking on additional public transit duties can be outside the scope of 
current insurance policies, and could put that coverage at risk. 
[Organizations considering providing transportation with Metropolitan
Council funding should request that the Metropolitan Council indemnify
their organization and Board of Directors for any claims arising out of 
their transportation activities as a result of their contract. 
Any nonprofit should make certain that their organization name is
specifically included on the certificate of insurance by the
Metropolitan Council's insurance carriers.]

2. Nonprofit fiduciary duties with regard to regulated industries and 
contractual relationships with public entities. Contractual relationships
between organizations and public entities give rise to additional liabilities,
especially in heavily regulated industries like transportation.  
Nonprofit organizations need to undertake careful legal and board review
to consider the implications, full costs and liabilities of new contracts 
with any public entity. 

Organizations that do not have a current contract 
with the Metropolitan Council should make certain that all conditions and
requirements, as well as effects on current insurance coverage, are thoroughly
reviewed by legal counsel and approved by the organization's board of directors.
[Boards and staff considering Metropolitan Council grants should understand 
requirements for drivers, processes for driver recruitment, necessary background
checks for drivers, and scope of work. Definition is needed for transportation
expectations: Are clients to be transported only for human and social service 
appointments or to child care, work, medical and other destinations? 
Route scheduling to maximize efficiency requires careful planning.]

3. Negative effects on public support for charitable organizations.
Accepting funds from the parties to the current contract dispute would 
unwisely insert nonprofit organizations into the middle of the conflict. 
This is likely to create ill will from the public that nonprofit organizations 
cannot afford because they rely on charitable contributions from the public. 
The contract dispute between the Met Council and the Amalgamated Transit Union
is a serious public issue, and MCN has urged both sides to seek a settlement 
acceptable to both the employees and the Metropolitan Council. 

MCN is convening a nonprofit working group to consult with organizations
about how they can assist members of the public during the bus strike, 
and will be providing additional information via e-mail and at the MCN web site.  
If you have questions or comments about this matter, or other subjects relevant
to nonprofit organizations, please feel free to call Jon Pratt or Sondra Reis at 651-642-1904.
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Madeline Douglass
Kingfield (Mpls)