The vice president of Public Risk Insurors told The Tennessee Star the company paid the Tennessee School Board Association (TSBA) a flat $15,000 annual fee to be a premier business affiliate and receive the benefits of that program.
That confirmation came in a phone interview earlier this month, which was prompted by a letter from Public Risk Insurors Chief Financial Officer Dave Williams to The Star in response to our story, published March 4, titled “Taxpayer-Funded TSBA Has $5.3 Million in Assets, Paid Top Two Execs $499k Annually, Offers Special Access to Business Affiliates.”
During that phone interview, Williams told The Star everything in our original story was factually correct.
Williams was quick to point out that Public Risk Insurors paid a flat $15,000 annual fee to TSBA, and did not pay a percentage of receipts from contracts stemming from introductions to schools made by TSBA to Public Risk Insurors as part of the premier business affiliate relationship.
“We consider it an honor to be a Business Affiliate of the TSBA and as an independent insurance agency, we do not pay the TSBA or any other educational organization with whom we participate as a vendor or convention sponsor a percentage of our receipts. That would be illegal,” Williams wrote in his letter to The Star.
Williams noted in his letter that “Your article also states, ‘One curious aspect of the financial documents The Tennessee Star obtained is the TSBA’s relationship with what it calls ‘Business Affiliates’.’ As you also noted, our company, Public Risk Insurors, is a Premier Business Affiliate. To become recognized as a Business Affiliate of the TSBA at any level, the highest ethical standards by business practice and reputation are required of that particular company as well as letters of recommendation from school systems with whom one is already doing business.”
In the March 4 article on The TSBA, The Star reported:
According to its website, a TSBA “Premiere Business Affiliate” vendor can get special access to LEA decision makers by giving TSBA a negotiated percentage of the “Premiere Business Affiliate’s” actual revenue from sales to LEAs.
For a minimum payment of $15,000 per year to the TSBA, “Premier Business Affiliates” are apparently provided special access to Tennessee public schools, but agree to provide TSBA with “a negotiated percentage of vendor’s actual revenues generated by sales to Tennessee public schools,” according to the TSBA website.
The TSBA adds this qualifier on the arrangement:
In the event that a fee constituting a percentage of sales is, or even possibly is, noncompliant with any law regarding a particular vendor or industry, then a lump sum fee shall be negotiated.
Among the many benefits Premier Business Affiliates receive are:
- A complimentary list of TSBA Annual Conference participants.
- A letter to all school boards introducing the company to the TSBA membership and explaining their product/service.
- A meeting with the TSBA Board of Directors.
In his letter to The Star, Williams also offered the following:
Having personally witnessed over the past 5 years the character and commitment to Tennessee public schools and to school board members and school officials exhibited by Dr. Tammy Grissom and by TSBA General Counsel Randy Bennett, I found your article extremely misleading regarding both the mission and activities of the Tennessee School Boards Association. The timing of the piece of course appears to deliberately coincide with Governor Lee’s State of the State address and emphasis on school vouchers. I voted for and support Governor Lee. I also donated to his campaign and attended his inauguration. However, I am not a supporter of school vouchers but I can certainly appreciate what the efforts are supposed to accomplish.
As a native of Nashville, I grew up in the housing projects of East Nashville, graduated from East High School and Belmont College. And I am sure that if vouchers were available when I attended East some students would have wanted to use them. The arguments for and against public money being used for school vouchers are many and well documented. As you noted, the TSBA and many county school systems in this area have sided with public school teachers and public education on this issue and I believe they are right and I was of that opinion long before our company became a business affiliate of the TSBA.
The full Education Committee of the Tennessee House of Representatives is expected to vote on Gov. Lee’s Education Savings Account bill on Wednesday.
