Administrative Services, Risk Management

Rule R37-4

Adjusted Utah Governmental Immunity Act Limitations on Judgments

Notice of Proposed Rule

(Amendment)

DAR File No.: 33393
Filed: 02/17/2010 09:09:44 AM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The proposed amendments adjust the limits of property and liability judgments against governmental entities and employees whom a governmental entity has a duty to indemnify for personal injury and property claims occurring on or after 07/01/2010.

Summary of the rule or change:

The consumer price index for calendar year 2009 is computed and indicated to be 4.5%. For claims occurring on or after 07/01/2010, the judgment limit for personal injury is increased to $648,700 per person, per occurrence, and the aggregate judgment limit for personal injury is increased to $2,221,700. The judgment limit for property damage claims occurring after 07/01/2010 is increased to $259,500.

State statutory or constitutional authorization for this rule:

• Subsection 63G-7-604(4)

Anticipated cost or savings to:

the state budget:

These increased limits increase the costs that state entities may be required to incur to resolve claims and satisfy judgments incurred for property and personal injury incidents that occur after 07/01/2010.

local governments:

These increased limits increase the costs that local governmental entities may be required to incur to resolve claims and satisfy judgments incurred for property and personal injury incidents that occur after 07/01/2010.

small businesses:

There may be cost increases in the recovery of subrogation claims against small businesses that are deemed jointly liable with a governmental entity in causing a personal injury or property damage claim after 07/01/2010.

persons other than small businesses, businesses, or local governmental entities:

There may be cost increases in the recovery of subrogation claims against persons, other than businesses and local governmental entities, who are deemed jointly liable with a governmental entity in causing a personal injury or property damage claim after 07/01/2010.

Compliance costs for affected persons:

Compliance costs will be quantified in claim settlements and judgments that affected persons incur and are too individualized to determine specifically. In general, on 07/01/2010, the potential exposure for a personal injury claim will increase by $28,000 per person, and the potential aggregate exposure for a personal injury claims will increase by $95,000. The potential exposure for property claims on 07/01/2010, will increase by $11,200.

Comments by the department head on the fiscal impact the rule may have on businesses:

While the judgment limit increases reflected in this rule amendment will increase the potential exposure of businesses who are jointly liable with governmental entities for personal injury and property damage they cause, these increases are relatively minor, both as to the context of exposure and the extent of exposure, compared to the general exposure to businesses, who are not covered by the governmental immunity act.

Kimberly K. Hood, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Administrative Services
Risk Management
450 N STATE ST
SALT LAKE CITY, UT 84114-1201

Direct questions regarding this rule to:

• Stephen Hewlett at the above address, by phone at 801-538-9572, by FAX at 801-538-9597, or by Internet E-mail at shewlett@utah.gov
• Brian Nelson at the above address, by phone at 801-538-9576, by FAX at 801-538-9597, or by Internet E-mail at benelson@utah.gov
• Tani Downing at the above address, by phone at 801-538-9560, by FAX at 801-538-9597, or by Internet E-mail at tdowning@utah.gov

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

04/14/2010

This rule may become effective on:

04/21/2010

Authorized by:

Kimberly Hood, Executive Director

R37. Administrative Services, Risk Management.

R37-4. Adjusted Utah Governmental Immunity Act Limitations on Judgments.

R37-4-1. Authority and Calculation Process.

Pursuant to UCA 63G-7-604(4)[(b)] (formerly 63-30d-604(4)(b)) the Risk Manager hereby establishes a new limitation of judgment.

Accordingly, the Risk Manager has calculated the consumer price index (CPI) for calendar years [2005]2007 and [2007]2009 using the standards provided in Sections 1(f)(4) and 1 (f)(5) of the Internal Revenue Code. Section 1(f)(4) has defined the CPI for any calendar year to mean the average of the consumer price index as of the close of the 12-month period ending on August 31 of such calendar year. Section 1(f)(5) has defined "consumer price index" to mean the index used for all-urban consumers published by the Department of Labor. By applying these standards, the consumer price index for the calendar year [2005]2007 is calculated to be [192.77]204.87 and the index for [2007]2009 is [204.87]214.00. The percentage difference between the [2005]2007 index and the [2007]2009 index was then computed to be [6.3]4.5%.

 

R37-4-2. New Limitation of Judgment Amounts.

As a result of the above required calculations, the new limitation of judgment amounts currently required by UCA 63G-7-604(1) has been increased as follows, and is effective July 1, [2008]2010 for claims occurring on or after that date:

1) The limit for damages for personal injury against a governmental entity, or an employee who a governmental entity has a duty to indemnify, is [$620,700]$648,700 for one person in any one occurrence[ (instead of $583,900)], and [$2,126,000]$2,221,700 aggregate amount of individual awards that be may awarded in relation to a single occurrence[ (instead of$2,000,000)]; and

2) The limit for property damages (excluding damages awarded as compensation when a governmental entity has taken or damaged private property for public use without just compensation) against a governmental entity, or an employee whom a governmental entity has a duty to indemnify is [$248,300]$259,500 in any one occurrence[(instead of $233,600)].

 

R37-4-3. Limitations of Judgments by Calendar Date.

The limitation on judgments are established by the date of the occurrence. The dates and dollar amounts are as follows:

1) Incident(s) occurring before July 1, 2001 - $250,000 for one person in an occurrence, $500,000 aggregate for two or more persons in an occurrence; and $100,000 for property damage for any one occurrence as explained in R37-4-2(2).

2) Incident(s) occurring on or after July 1, 2001 - $500,000 for one person in an occurrence, $1,000,000 aggregate for two or more persons in an occurrence; and $200,000 for property damage for any one occurrence as explained in R37-4-2(2).

3) Incident(s) occurring on or after July 1, 2002 - $532,500 for one person in an occurrence, $1,065,000 aggregate for two or more persons in an occurrence; and $213,000 for property damage for any one occurrence as explained in R37-4-2(2).

4) Incident(s) occurring on or after July 1, 2004 - $553,500 for one person in an occurrence, $1,107,000 aggregate for two or more persons in an occurrence, and $221,400 for property damage for any one occurrence as explained in R37-4-2(2).

5) Incident(s) occurring on or after July 1, 2006 - $583,900 for one person in an occurrence, $1,167,900 aggregate for two or more persons in an occurrence, and $233,600 for property damage for any one occurrence as explained in R37-4-2(2).

6) Incident(s) occurring on or after July 1, 2007 - $583,900 for one person in an occurrence, $2,000,000 aggregate for two or more persons in an occurrence, and $233,600 for property damage for any one occurrence as explained in R37-4-2(2).

7) Incident(s) occurring on or after July 1, 2008 - $620,700 for one person in an occurrence, $2,126,000 aggregate for two or more persons in an occurrence, and $248,300 for property damage for any one occurrence as explained in R37-4-2(2).

8) Incident(s) occurring on or after July 1, 2010 - $648,700 for one person in an occurrence, $2,221,700 aggregate for two or more persons in an occurrence, and $259,500 for property damage for any one occurrence as explained in R37-4-2(2).

 

KEY: limitation on judgments, risk management, governmental immunity act caps

Date of Enactment or Last Substantive Amendment: [July 1, 2008]2010

Notice of Continuation: October 9, 2007

Authorizing, and Implemented or Interpreted Law: 63G-7-604(4)[63-30-34(4)(b)]