State costs for settlements and judgments dropped last fiscal year

DES MOINES – State government paid more than $3.78 million from the general fund in fiscal 2011 to settle claims and resolve disputes caused by employee mistakes, workplace misconduct or other damages – a total down significantly from the prior fiscal year, officials said Wednesday.

A large share of the settlements and judgments approved by the State Appeal Board were the result of medical negligence cases at the University of Iowa Hospitals & Clinics in Iowa City, which topped $2.46 million, and $884,171 paid for pre-litigation settlements stemming from the state's troubled film tax credit program.

Joseph Barry, the state's risk manager within the Iowa Department of Management, credited some of the decline from the $6.85 million payout in fiscal 2010 to a more streamlined and analytical process established by the Iowa Attorney General's Office that has provided more scrutiny and required more documentation for people who make claims or seek to recoup damages due to the actions of state employees.

State Treasurer Mike Fitzgerald added that “just good fortune” also probably was at play in the settlements and judgment that have moved up and down from year to year.

“I think it's the natural ebb and flow,” said Fitzgerald, an appeals board member.

The largest single claim in the recently completed fiscal year was a $1.275 million payment the state made to settle a lawsuit brought against the UI hospital alleging negligence in the death of Maxine Driscoll. UI physicians contributed 15 percent, or $225,000, for the $1.5 million settlement, according to state records.

In another $1.5 million settlement involving allegations of medical negligence arising from the treatment received by Nancy Kammerer at the UI hospital, 25 percent was paid from the state's general fund and the remaining $1,125,000 was paid by UI physicians – including some payments to satisfy liens brought by health-care plans and Medicare, according to state records.

Also, $180,000 was paid last fiscal year to settle a lawsuit alleging gender discrimination in employment brought by Jennifer Wright against the state and the former head of the state's Office of Energy Independence and $75,000 to settle an age discrimination claim brought against the state by Steven Mosena. Other claims involved motor vehicle accidents and other mishaps or alleged negligent action.

The State Appeals Board authorized pre-litigation settlements of $450,000 were paid to Midsummer Films, which had registered six projects under Iowa's now-suspended film tax credit program, and more than $434,000 paid to After Dark Films to resolve contract disputes regarding tax credits for the films “Husk” and “Fertile Ground.”

David Roederer, director of the state Department of Management and an appeals board member, said he expected additional film-tax credit settlements to come before the board that might temporarily skew the yearly figures similar to fiscal 2008 when TouchPlay settlements made up a major share of the record $23.5 million in judgments the state paid in that year.

Yearly general fund judgments/settlements paid by state government

Fiscal year Payout:

2011: $3,780,323

2010: 6,854,958

2009: 2,552,812

2008: 23,530,913

2007: 6,741,962

2006: 6,221,012

2005: 8,526,313

2004: 8,252,713

2003: 4,231,783

2002: 4,146,646

2001: 2,920,520

2000: 2,163,541

Source: State Appeal Board