Date: Mon, 14 Mar 94 14:14:43 EST
From: justin@dsd.camb.inmet.com (Mark Waks)
Message-Id: <9403141914.AA27618@dsd.camb.inmet.com>
To: troll@sug.org
Cc: carolingia@bloom-beacon.mit.edu
In-Reply-To: <9403141746.AA00960@bridge.sug.org> (troll@sug.org)
Subject: Re: autocrat's pledge

Aleks writes:
>Insurance is necessary.  Most sites won't even rent to an organization
>or individual without insurance.

I'm sorry, but this is simply incorrect. I've autocratted a fair
number of events over the past decade. I have *never*, not once, been
asked to demonstrate insurance cover -- never even been asked about
it. Yes, many sites (particularly ones owned by the state in some
fashion) do require it, but the considerable majority don't. We'd have
trouble finding a 12th Night site without insurance, but I'm not
expecting an extra-SCA event to be that big...

Nor am I willing to succumb to over-much paranoia. Yes, disasters
happen. They are also pretty rare; I'm not sure that Carolingia has
*ever* had a problem at an event that required the insurance to be
invoked; certainly it hasn't happened much. I can understand Tibor and
Aleks' concern, and I would certainly take reasonable precautions to
keep the chances of a suit down, but I can't run my life on the basis
that only That Which Is Insured can be done. (I see this sort of
attitude as a major element feeding the lawsuit-frenzy of this country
today -- suits and insurance set up a *very* nasty feedback
mechanism. I'm not willing to feed that paranoia.)

(There are reasonable limits. I probably wouldn't be willing to run
a tourney without insurance, or at least some carefully-worded
waivers. I'd probably be willing to run a feast, so long as I kept
a close eye on it. I'd definitely be willing to run a Ball; indeed,
if the situation weren't in so much flux right now, I'd be making
plans to run my late-period Inns of Court Ball as a non-SCA event...)

>Buying liability insurance is *expensive*.  When this whole uproar
>started, I went to my corporate insurance broker and explained what we
>needed (I'll happily provide the details to them what wants).  The
>short version is that the type of coverage we want costs about $2500
>per year, plus ~$200 per event.

That's not cheap, but it's not wildly expensive either. If we tacked
$2-3 onto the cost of each event, we'd cover that pretty neatly. I
actually find those numbers quite encouraging; I thought insurance
cover was quite a bit higher than that. These numbers are definitely
in the manageable range, although higher than I'd like...

(I don't find $2 on an event unreasonable, if it means people don't
have to get an increasingly-expensive SCA membership; the SCA doesn't
get to be a good deal until around 10 events/year...)

Of course, there are also alternatives like getting covered by the
LHA's insurance policy; there are tradeoffs to this, too, but it
serves as a not-half-bad compromise...

>The biggest liability of running an event as an individual is the tax
>burden.  There may be ways around this, but on a basic level even a
>little event like Maslenitsa pulled in about $1300 gross.  Of course,
>the barony doesn't see that money because it is gross, not profit (we
>have to pay for the site, the staff, the food, etc).  If it were a
>privately run event, to the IRS it looks like Alex Newman made $1300
>off of running it - and they'd want their share.

My understanding (which is *definitely* not gospel, but comes from
talking to some SCA break-even merchants) is that the IRS doesn't care
much, *provided* that you break even within a given one-year span for
a project like this. (Effectively, you can write off the expenses, so
it doesn't affect your taxes if you keep it at break-even.) I would
probably want to check this out more thoroughly before running an
event, but I believe the relevant tax laws are more sophisticated than
you make them out to be...

In the long run, I'd probably encourage the Barony to incorporate and
seek either its own insurance or a good umbrella; in the short run,
however, I could easily see running some events as private individuals.
(And might do so myself if things work out badly...)

				-- Justin
				   Who keeps hearing Vis in one ear being
				     pretty optimistic, Tibor in the other
				     being pretty pessimistic, and finds
				     himself constantly wavering between
				     the two...

Random Quote du Jour:

"*Dialectic*! He said *dialectic*!"
"Right. He can't eat no damn candy bars."
		-- from Empire Lanes