Focus on education drives risk management decisions

<b>Scott B. Clark</br>Miami-Dade Public Schools</b><br>/ Michael Marcotte

When Scott B. Clark was recruited for the Miami-Dade County Public Schools' risk management department in 1986, he initially had doubts about working for a public entity.

At the time, Mr. Clark was working as a sales representative for Wausau Insurance Cos. in Miami. His supervisor, Robert Barrett, who was also an adjunct professor at the University of Miami teaching risk management, was asked by the district's risk manager, 1985 Honor Roll member Susan Weiner, to help find the right person to be her deputy.

Mr. Barrett encouraged Mr. Clark to apply for the position of assistant risk and benefits officer, but Mr. Clark was concerned about the politics involved in working for the school district.

"I said to him, 'The risk management piece is interesting, but I have no interest whatsoever in working for government,' " Mr. Clark said. "It was not ever in my wildest imagination that I would work for a public entity."

Despite his doubts, he interviewed for and eventually accepted the position, a decision he has never regretted in more than 20 years on the job. In 1999, he was promoted to his current post of risk and benefits officer of the huge Florida school district.

"I think I'm a very lucky person because I love what I do," Mr. Clark said, noting that his employer's product is the education of more than 360,000 children. "That's very rewarding."

Mr. Clark's long service as a public entity risk manager, his devotion to the education of the students of Miami-Dade County, and his visionary efforts to effectively minimize and manage the district's risks have earned him a place on Business Insurance's 2007 Risk Management Honor Roll.

Those who know him best say it is a well-deserved honor.

"He is absolutely by far the most professional risk manager I've ever worked with," said David Marcus, vp, southeast regional manager for Arthur J. Gallagher & Co. (Florida) and a managing director of Boca Raton, Fla.-based Gallagher Public Entity and Scholastic Division. "He is a consummate professional," said Mr. Marcus, who has worked more than two decades as the school district's broker with Mr. Clark.

Every risk management decision Mr. Clark makes is driven by his ultimate goal of reducing insurance and risk management costs so that money can be devoted to educating the children, said Carol Erbs, assistant risk and benefits manager for the Miami-Dade County Public Schools. "He never forgets what the mission is," she said, "Not a week goes by that he doesn't remind us that our charge is the education of the children."

Working as a public entity risk manager comes with unique challenges. The biggest risk the school district currently faces is the way education is funded in Florida, Mr. Clark said. The state's funding formula rewards districts that are growing, so districts such as Miami-Dade County are being penalized because enrollment has decreased, he said.

The budgetary constraints necessitate developing a strategy to manage risk in the most cost-effective way possible, Mr. Clark said. "One of the things I think is a big challenge for us is to create meaningful ways to stem the outflow of dollars in the district because we're not seeing a lot of new dollars come in."

Despite his initial concerns, Mr. Clark said he has not been drawn into the politics involved in working for a public entity.

Having a good relationship with the school board has helped alleviate some of the pressure of working for a public entity because the board has not felt the need to get too involved in the most difficult aspects of the job, including the property insurance program, Mr. Clark said. "They care, but I think there is a level of understanding and trust that it's well-managed," he said.

While the board members may not always agree with what Mr. Clark says, they know there is a good business reason for every risk management and benefits decision he makes, Ms. Erbs said. "People know that he always has the right reason for doing things," she said. "The level of respect he's garnered in this district is phenomenal."

The most successful public entity risk managers focus on making their best business recommendations and not taking it personally if the board decides it wants to go in another direction, Mr. Clark said.

Other challenges he has faced, challenges that are not uncommon among large employers, include managing the district's workers compensation program to reduce injuries and contain costs (see story, page 60).

His risk management initiatives, though, are always innovative, even for typical problems, Ms. Erbs said. "He comes up with solutions that have never entered my mind," she said.

Operating in a tight property and an even tighter catastrophe property market is another common issue for risk managers both public and private, but Mr. Clark faces a tremendous challenge as the risk manager for one of the largest property owners in Florida (see story, page 57). Placing the district's property insurance program has been a challenge ever since the district sustained a $96 million loss due to Hurricane Andrew in 1992.

Despite its challenges, the property program is often secondary to the district's benefits program, which includes negotiating with six unions during the collective bargaining process, he said. "The benefits piece, because it does affect each and every employee, becomes a very personal issue," he said.

After salaries, the benefits program is the school district's largest expenditure, with a cost of about $300 million a year for the district's roughly 50,000 full- and part-time employees. Mr. Clark has had tremendous success in managing his benefits program as well, recently negotiating and implementing a health insurance contract that will save the district about $15 million in premiums over a 20-month period. The savings are funding benefit enhancements, including lower dependent premiums so more district employees can purchase health coverage for their spouses and children.

Despite all of his accomplishments, Mr. Clark is extremely humble, Mr. Marcus said. "He's not going to brag about what he does in his job," he said.

Indeed, Mr. Clark gives much of the credit for the successes of the district's risk management and benefits programs to his 45 staffers. "I've been very lucky as a manager to find really dynamic people in the industry to come work for the school district," he said.

Mr. Clark inspires loyalty among his staff, several of whom, like Ms. Erbs, are former directors of risk management for other organizations.

"He has a good staff," Mr. Marcus said. "They're very loyal to him because he's very loyal to them. He allows them to do their jobs. I think there's a great deal of respect both ways."

The reason for the loyalty, Ms. Erbs said, is that Mr. Clark's staff knows he cares about their well-being and personal growth.

"He's probably one of the most sincere, caring people that you would ever meet," she said. "He truly cares about his people."