Parsons USD 503 could be facing massive increases in cyber insurance.

Superintendent Lori Ray said the district’s property, liability and worker’s compensation insurance for 2022-2023 would be increasing from $169,502 to $175,496, not including cyber insurance.

Bob Wood with Wood-Dulohery Insurance explained to the board that there has been a dramatic increase in costs of cyber insurance everywhere because there has been a lot of cyber crimes. While places try to find new ways to protect themselves, hackers are finding new ways around those safety and security measures.

“It’s just an undefendable crime,” Wood said. “These hacker cyber guys will think of something new every day, and the world just has to keep reacting every day to what they’re doing,” he said.

Wood said this is affecting all public entities. No one is willing to insure schools except Employers Mutual Dividend Program, in which the majority of school districts in Kansas participate.

He said there is a self-insured pool, but those are scary. Even those are seeing deep increases this year.

Cyber insurance was about $7,000 last year for the district. Wood said he has one offer for the district this year at $18,800, and he is thinking the district doesn’t want to go there.

He is hoping to have it down to around $10,000 by the time he is done negotiating.

The district has to have a lot of measures in place. He said they worked with the district’s tech department last week to make a few changes that should prove more favorable for insurance costs.

“I’m working at it as hard as I can,” Wood said. “Employers is dedicated to the school market and keeping coverage in place for the districts, but they have to do it profitably, so they have been taking some moves over the last couple of years to address that. All the districts contribute into a pool/fund and then losses are calculated at the end of the year and then a dividend is paid back to the districts based on the profitability. They do the same thing for counties and cities. The county and city program has been successful getting back 20 to 30% in dividends on the premium, but they have never been able to get the schools in a place where they could pay out dividends except one time in the past 25 years. So, they have been increasing rates to get it in line to be able to do that.”

Now, Wood said they have been hit this year, not so much by increased rates, but increased valuation.

Wood said people’s property values are not high enough to rebuild their property with the increased costs of property, shortage of materials and the time it takes to get things rebuilt.

“People just don’t have enough insurance to cover what they’ve got to replace,” Wood said, so there has been a big push in the industry to get those valuations up.

For the school district, Wood said it means increasing valuation on the district’s facilities by about 15% overall. The blanket total raises the valuation from about $63 million to about $66 million.

If insurance is not within 90% of replacement value, insurance companies can penalize customers if an incident occurs and they lose a portion of the payment by whatever percentage they are under. Wood said the district has to get the premium up where the risk is.

He has talked to the insurance about a 7% increase, incrementally increasing valuation.

He negotiated and got the high school valuation down to $19,196,312 instead of $23 million.

He continues to work for a more affordable rate on cyber insurance for the district.

IN OTHER BUSINESS, the board:

— Approved the 2021-2022 amended budget.

— Heard summer school is in full swing and districtwide there are 150 students participating. About 30 high school students are participating in credit recovery. It ends June 30.

— Heard additional information has been asked for from the state on ESSER funding application.

— Saw Kendra Barcus, Hope Smith, Tiffany Hicks and Shelley Gardner be recognized with certificates from the University of Kansas for 25 years of service.

— Heard the district office will be closed for July 4.

— Accepted donations to district schools valued at $10,718.98.

— Moved to approve the 2022-23 staff handbooks, student/parent handbook, bus driver handbook, parent/student transportation handbook with updates to the crisis and response plans to make them consistent in accordance with insurance recommendations.

— Discussed recommended Kansas Association of School Boards policy updates. Approval will be in July.

— Set an organizational meeting for 6 p.m. before the July regular board meeting July 18.

— Approved a cooperative agreement with St. Patrick Catholic School for middle school football, girls tennis, boys tennis, wrestling, boys basketball and boys and girls golf.

— Authorized a transfer of funds to close out the fiscal year.

— Approved renewal of proposals for property and liability and workers compensation insurance for 2022-2023, except cyber liability

Approved participation in the Greenbush Energy Group and Hedging Authorization to acquire natural gas for the school district for 2022-23.

— Approved a contract with WoodRiver Energy/Kansas gas to provide natural gas for 2022-23.

— Heard the Parsons Police Department does not have enough staff to provide a school resource officer for the start of the 2022-2023 school year. Larger municipalities, with more pay and more room for advancement, are luring officers away from small departments. Some officers are in training and there may be enough staff to allow hiring a school resource officer in December if there is enough staff.

— Approved a memorandum of agreement with Greenbush for Parents as Teachers participation during the 2022-2023 school year. Cost equates to about $900 per child and totals about $18,000 for the early childhood intervention program for families with children up to age 5.

— Tabled the discussion on the soccer field memorandum of understanding.

— Heard there will not be free meals for all students any more so parents will again have to apply for free and reduced lunches. The board approved the meal prices, which did not change from three years ago when the district was charging. Elementary breakfast is $2.05 and lunches are $2.90. Middle school breakfasts are $2.15 and lunches are $3.15. High school breakfasts are $2.30 and lunches are $3.30, and adult breakfasts are $2.75 and lunches are $4.75. Ray said it is important for everyone to fill out the lunch application even if the student doesn’t plan to eat at school, as funding is directly related to the number of students who qualify for free and reduced lunches.

— Approved the meal charge policy.

— Approved the food service written standard of conduct for employees.

— Approved adding an additional football coach.

— Approved paying the remaining FCCLS funding to go to nationals in San Diego, California, not to exceed $5,000.

— Hired Laurie Griffin, Lincoln Title I aide; Cyprus Jones, high school Edgenuity/ISS aide; Terri Jones, Garfield Title I aide; Lillian Kindrick, preschool aide; Kylie Lucas, high school academic adviser; Mackenzie Manues, preschool aide; Kristina Mayhue, social worker; Baylee Montee, Garfield behavior support aide; Breanna Nush, Garfield STEM/instructional aide; Terry Smith, middle school VSP teacher; Sherri Tierney, second grade teacher.

— Accepted the resignations of Ryan Chandler, high school ISS aide effective June 6; Katie Hayden, Garfield STEM/instructional aide; Mike Krull, seventh grade social studies teacher, effective June 3; Chad Rourk, elementary PR teacher.

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