BUSINESS RELATED INSURANCE FOR PORT COMMISSIONERS

DISTRICTS ‑- PORT ‑- COMMISSIONERS ‑- INSURANCE ‑- BUSINESS RELATED INSURANCE FOR PORT COMMISSIONERS

A port district may provide, and pay the premiums on, business related travel, liability, health, errors and omissions and accident insurance under RCW 53.08.170, as amended by § 1, chapter 6, Laws of 1973, 1st Ex. Sess., for its present port commissioners during the remainder of their current terms of office for the purpose of affording insurance coverage to those commissioners in the event of accidents or illnesses resulting from the performance of their official responsibilities.

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                                                                   June 12, 1974

Honorable Don L. Talley
State Senator, 18th District
1583 Mt. Pleasant Road
Kelso, Washington 98626                                                                                                               Cite as:  AGLO 1974 No. 60

Dear Senator Talley:
 
            By recent letter you have asked for our opinion on a question which we paraphrase as follows:
 
            Is it legal for a port district to provide, and pay the premiums on, business related travel, liability, health, errors and omissions and accident insurance under RCW 53.08.170, as amended by § 1, chapter 6, Laws of 1973, 1st Ex. Sess., for its present port commissioners during the remainder of their current terms of office for the purpose of affording insurance coverage to those commissioners in the event of accidents or illnesses resulting from the performance of their official responsibilities?
 
            We answer this question in the affirmative as explained in our analysis.
 
                                                                     ANALYSIS
 
            RCW 53.08.170, as amended by § 1, chapter 6, Laws of 1973, 1st Ex. Sess., provides, insofar as is here material, as follows:
 
            "The port commission shall have authority to create and fill positions, to fix wages, salaries and bonds thereof, to pay costs and assessments involved in securing or arranging to secure employees, and to establish such benefits for employees, including holiday pay, vacations or vacation pay, retirement and pension benefits, medical, surgical or hospital care, life, accident, or health disability insurance, and similar benefits, already established by other  [[Orig. Op. Page 2]] employers of similar employees, as the port commissioner shall by resolution provide:  PROVIDED, That any district providing insurance benefits for its employees in any manner whatsoever may provide business related travel, liability, health, errors and omissions and accident insurance, for its commissioners, which insurance shall not be considered to be compensation."  (Emphasis supplied.)
 
            The issue raised by your letter is whether such insurance as is authorized by the proviso to this statute, as added by § 1, chapter 6, supra, will constitute "compensation" so as to preclude its being received by the members of a board of commissioners of a port district during the remainder of their current terms.  See, AGO 1974 No. 9 [[to Smith Troy, Prosecuting Attorney, Thurston County on April 10, 1974]], copy enclosed, in which we advised that because of the prohibition against mid-term [[*sic (midterm)]]salary increases for public officials who fix their own compensation, as conatined in Article XXX, § 1 (Amendment 54) of the state Constitution, the members of a board of county commissioners may not, during their respective terms of office, receive increases in such health care benefits as they have provided for themselves and other county officers and employees under the provisions of a different set of statutes, RCW 41.04.180 and 41.04.190.
 
            In that instance, however, we were dealing with a statutory authorization for the procurement of insurance which, in itself, expressly labeled the cost of any such insurance as ". . . additional compensation to the employees or elected county officials covered thereby for services rendered, . . ."  See, RCW 41.04.190.  Here, on the other hand, we have in the language of RCW 53.08.170, as amended, an express statement that the insurance purchased for port district commissioners or employees under that statute ". . . shall not be considered to be compensation."  And, in addition, consistent with that characterization, the statutory authority contained therein is expressly limited to the purchase of "business related" insurance covering the commissioners of a port district; i.e., insurance that is designed to provide protection for those commissioners in the event of an accident or illness resulting from the performance of their official responsibilities as port commissioners.
 
             [[Orig. Op. Page 3]]
            In other previous opinions this office has advised that the purchase of insurance to protect a public officer or employee against losses on account of circumstances resulting from the performance of his official responsobilities is properly to be characterized as "indemnification" rather than as "compensation."  See, e.g., AGO 63-64 Nos. 118 [[ to Don L. Talley, State Senator on September 3, 1964]]and 124 [[to Charles O. Carroll, Prosecuting Attorney, King County on October 20, 1964]], and AGO 61-62 No. 71 [[to Mark Litchman, Jr., State Representative on October 11, 1961]], copies of which are also enclosed.  Conversely, the payment of any additional premiums for broader insurance coverage designed to cover any or all accidents or illnesses that might befall a port district commissioner (whether or not related to the performance of his official responsibilities) merely because the particular accident or illness occurred while the commissioner was engaged in the performance of his duties, would clearly constitute "additional compensation" for the purposes of the above noted constitutional prohibition against midterm increases for those public officials, including port commissioners, who fix their own compensation.  See, our opinion of February 18, 1965, to State Representative Ray Olsen, copy enclosed.
 
            For these reasons it follows that if the legislature's own express declaration in RCW 53.08.170, supra, that the insurance purchased for port district commissioners or employees under its provisions ". . . shall not be considered to be compensation" is to be given the effect required to support an affirmative answer to your question, the insurance thus purchased must be deemed to be limited to that which fits the "indemnity" rather than the "compensation" mold.  Accord, the well-established principle that where a statute is open to two constructions, one of which would render it constitutional and the other unconstitutional or open to grave doubt in that respect, the former and not the latter is to be adopted.  Soundview Pulp Co. v. Taylor, 21 Wn.2d 261, 150 P.2d 839 (1944).
 
            In conformity with this principle we have, in paraphrasing your question at the outset of this opinion, limited it to the purchase for present port commissioners of insurance ". . . for the purpose of affording insurance coverage to those commissioners in the event of accidents or illnesses resulting from the performance of their official responsibilities."  Bearing this limitation in mind, we answer that question in the affirmative.  The purchase  [[Orig. Op. Page 4]] of insurance for port commissioners of the kind and scope stated in your question, as paraphrased, is not subject to the prohibition against mid-term increases in compensation in Article XXX, § 1 (Amendment 54), supra, and for this reason, may legally be purchased by a port district to cover its present port commissioners during the remainder of their current terms of office.
 
            We trust that the foregoing will be of some assistance to you.
 
Very truly yours,
 
SLADE GORTON
Attorney General
 
PHILIP H. AUSTIN
Deputy Attorney General