OVERVIEW

TABLE 1.   TOTAL PAYMENTS BY DEPARTMENT FY 1989-90 THROUGH FY 1998-99

TABLE 2.   JUDGMENTS PAID BY DEPARTMENT FY 1989-90 THROUGH FY 1998-99

TABLE 3.   SETTLEMENTS PAID BY DEPARTMENT FY 1989-90 THROUGH FY 1998-99

TABLE 4.   FY 1998-99 NUMBER OF CASES AND PAYMENTS BY DEPARTMENT

FIGURE 1.   HIGHWAY NEGLIGENCE PAYMENTS FY 1983-84 THROUGH FY 1998-99

LISTING OF CASES RESULTING IN PAYMENTS DURING FY 1998-99:

COMMUNITY HEALTH

CONSUMER & INDUSTRY SERVICES

CORRECTIONS

EDUCATION

ENVIRONMENTAL QUALITY

FAMILY INDEPENDENCE AGENCY

JUDICIARY

LOTTERY

MANAGEMENT AND BUDGET

MILITARY AND VETERANS AFFAIRS

NATURAL RESOURCES

STATE

STATE POLICE

TRANSPORTATION - HIGHWAY NEGLIGENCE LITIGATION

TRANSPORTATION - OTHER CASES

This report was prepared by Bill Bowerman, Chief Analyst of the Senate Fiscal Agency General Government Unit. Pat Stinton-Harper typed the report. The Senate Fiscal Agency would like to thank all State departments and agencies for their cooperation.

Any questions regarding this report, or requests for additional copies, should be directed to:

The information in this document is based on reports filed by State departments and agencies pursuant to Section 396(4) of The Management and Budget Act (Public Act 431 of 1984). Based on the amounts reported, the State of Michigan paid $12,684,878 for judgments and settlements in fiscal year (FY) 1998-99. Of the 135 cases that resulted in payments, 28 were judgments totaling $3,203,699, and 107 were settlements totaling $9,481,179. Fiscal year 1998-99 payments total $223,408,685 less than FY 1997-98 payments. The level of payments in FY 1997-98 was due to the $211,101,341 payment in Durant v State of Michigan.

The funding sources for payments in FY 1998-99 were as follows:
 

Tables on pages 3, 4, and 5 provide a 10-year history (FY 1989-90 through FY 1998-99) of payments made by the State of Michigan. Table 1 provides information on total payments (judgments and settlements), Table 2 lists payments resulting from judgments only, and Table 3 lists settlements. A summary of departments that made payments totaling over $600,000 in FY 1998-99 begins on page 6. The FY 1998-99 reports submitted by State departments and agencies that list payments follows beginning on page 9. For each payment the name of the case is listed along with information regarding the funding source, the county where the cause of action arose, and a brief description of the plaintiff's allegation (summary of case). This report does not include payments resulting from workers' compensation and unemployment claims. Also not included are payments from the State's Risk Management Fund for automotive liability.

Six State departments made payments totaling over $600,000. Table 4 summarizes the number of cases and payments by department.
 

DEPARTMENT OF COMMUNITY HEALTH

Payments by the Department of Community Health in FY 1998-99 ranged from $2,101.54 in Brewer v MDCH for a Freedom of Information Act violation case to $195,298.50 in St. James Nursing & Physical Rehabilitation Inc. et al v MDCH for failure to promulgate rules for enforcement of penalties against long-term care nursing facilities. Fiscal year 1998-99 payments of $659,922 in nine cases represent a decrease of $1,471,643 (69.0%) from the $2,131,565 paid in FY 1997-98 for eight cases.

DEPARTMENT OF CORRECTIONS

The Department of Corrections made payments in 40 cases totaling $1,780,090. This represents a decrease of $1,447,727 (44.9%) from the $3,227,817 paid in FY 1997-98 for 42 cases. Payments ranged from $62 in Peoples-Bey v MDOC for a case involving a petition for review to $265,000 for an employee discrimination claim in Goncalves v MDOC. The median payment was $11,322. Six cases with payments over $100,000 totaling $1,239,000 accounted for 69.6% of payments made by the Department of Corrections. There were 11 cases alleging employee discrimination that accounted for payments totaling $1,017,500.

DEPARTMENT OF EDUCATION

Payments by the Department of Education in two cases totaled $1,705,551 in FY 1998-99. Almost all of that amount ($1,684,540) relates to continuing payments in the Berry v Benton Harbor Area School District desegregation case. State payments in that case have totaled $58,290,458 from FY 1980-81 through FY 1998-99.

The FY 1998-99 payment compares to $213,832,688 paid in FY 1997-98. However, $211,101,341 of the FY 1997-98 amount was the result of Durant v State of Michigan. The plaintiffs in that case claimed that the State violated Article 9, Section 29 (Headlee Amendment) of the Michigan Constitution when the State failed to maintain the State-financed proportion of the necessary costs of activities that State law requires plaintiff school districts to perform. Those activities included special education, special education transportation, driver education, and school lunch and supplemental milk programs. Local and intermediate school districts that were not plaintiffs in Durant were required to submit a waiver of liability by March 2, 1998, in order to receive funding from the State. Payments to nonplaintiff school districts in FY 1998-99 are not included in this report.

DEPARTMENT OF NATURAL RESOURCES

Payments by the Department of Natural Resources in 13 cases totaled $1,872,915, representing a decrease of $1,033,980 (35.6%) from the $2,906,895 paid in FY 1997-98 for six cases. Payments ranged from $2,265.51 in MBPIA - Ivory v MDNR for a case involving fire damage to adjacent property to $1,253,672.00 in Chase v MDNR for a motor vehicle fatality.

DEPARTMENT OF STATE POLICE

Payments by the Department of State Police in 12 cases totaled $787,057, representing a decrease of $81,084 (9.3%) from FY 1997-98 payments of $868,141 paid in 15 cases. Payments ranged from $250 in Schneider v MSP for a freedom of information case to $295,000 in Cremonte v MSP for alleged age, gender, and race discrimination regarding the promotion process. The median payment was $11,125. Four cases accounted for $735,500 (93.4%) of total payments by the Department.

DEPARTMENT OF TRANSPORTATION

Department of Transportation payments in 37 cases totaled $5,074,942, representing a decrease of $3,308,886 (39.5%) from the $8,383,808 paid in FY 1997-98 for 48 cases. Payments ranged from $600 in Auto Club v MDOT for a case alleging failure to warn for and maintain road surface to $767,500 in Skiba v MDOT for a case involving lack of left turn prohibitions and separate signal phases. Thirty-three highway negligence cases accounted for $4,721,422 (93.0%) of Department of Transportation payments. Eleven highway negligence cases with payments in excess of $100,000 accounted for $4,086,822 (86.6%) of highway negligence payments in FY 1998-99. The median highway negligence payment was $50,000.

From FY 1983-84 through FY 1998-99 the State paid $212.7 million in 1,053 highway negligence cases. Figure 1 below shows highway negligence payments attributed to each fiscal year. The amount paid in FY 1998-99 is the lowest payout for highway negligence claims over the last 16 years.