With 163,000 students, nearly 20,000 employees and $1.7 billion worth of property spread over an area a quarter the size of Rhode Island, the Dallas Independent School District presents a formidable array of challenges for Executive Director of Risk Management Cheryl P. Johnson.
Not only must the 56-year-old Johnson negotiate traditional and costly risks like workers' compensation and property cover for holdings from schools to swimming pools, but she must stay ahead of the threats accompanying life today at the nation's 12th largest school district: terrorism, hostage-taking, gang violence and the sexual conduct of teachers, among them.
"A lot of these issues are risks we never saw before," says Johnson, who joined the district 16 years ago.
"Some of these risks are uninsurable. Even if there was insurance for a domestic terror incident such as a hostage scenario, we couldn't afford it," she says.
Instead, the district attempts to mitigate these risks by planning for the unexpected with drills that stage possible disasters--whether a scenario in which local terrorists unleash chemicals from a train passing by an elementary school or a hostage situation that mirrors the 1999 tragedy at Columbine High School in Littleton, Colo., in which more than a dozen people died.
"We want people to know what to do instead of acting spontaneously," says Johnson. "To know, for example, who takes over if the principal of a school is injured and taken to the hospital, or is just simply on vacation the day a disaster occurs."
To stay on top of the latest emergency-response techniques, Johnson and seven other district employees attended a training session held in Emmetsburg, Md., last fall by the Federal Emergency Management Agency of the U.S. Homeland Security Department.
"I learned there's a whole different language for emergency management," says Johnson. "I never thought schools could be a target for so many things."
As a result of this session, 350 principals and assistant principals who have received extensive training will begin passing on this knowledge until the training eventually funnels down to every employee in the district.
"I'm a positive person, but I have to think of the worst thing that could happen," says Johnson, who earned a Master of Liberal Arts degree from Southern Methodist University in Dallas in 1994. "Like how many people must be missing from a school before you shut it down because of an attack of bird flu."
GANGING UP ON RISK
To enhance the safety of thousands of school children in its charge and minimize the potential havoc that can we wreaked by gangs--a primary threat--the Dallas district launched a 13-point safety initiative that focuses on prevention and intervention nearly two years ago.
A retired Houston police officer and graduate of the FBI National Academy, John R. Blackburn, now heads a district police and security-services force that completely took over from the Dallas Police Force Department beginning with the 2005-2006 school year.
Another major program under Johnson's charge, initiated by her boss, Division Executive for District Operations Charles Fridia, is an ambitious districtwide wellness program.
"We started a biggest-loser contest in my office in January of 2005, and 13 of us lost more than 300 pounds," Johnson says. "That program was a prototype that other departments emulated."
Fridia notes that the program already has a strong online component, and he expects the wellness project to be entrenched into the district culture within a year or so.
He adds, "Cheryl is a very, very enthusiastic person. She's like a kid with a new toy with the wellness program."
Another important part of the district's business life is shaped by the 1969 Texas Tort Claims Act, which grants Texas school districts immunity from tort liability claims, helping the Dallas district control its liability costs. People who are injured while on school property realize they won't gain a windfall by filing suit against the school district.
"This saves us money for items we need, such as teachers' salaries and school supplies, instead of paying for insurance for liability losses," says Johnson, estimating the district would have to lay out millions in annual premiums for liability insurance.
Yet for all the emerging risks that accompany public education in the United States today, the top three risks for this sprawling district remain more traditional: workers' compensation; construction risk for an ambitious school-renovation program; and property cover for a wide variety of holdings that currently include 229 schools, eight athletic stadiums and even a few helicopters.
Johnson says she inadvertently learned about the helicopters--which remain on the ground and are used for airline mechanics training--after a 1995 hailstorm damaged some of them.
The district saves about $4 million a year by administering its own workers' compensation program, says Johnson. She notes that workers' comp losses from employee injuries cost the district $6.6 million in the last fiscal year.
A new Texas law that lets the insurer or employer choose a claimant's physician in a workers' compensation case should produce additional savings of 5 percent annually, she adds.
The district has not yet applied the law, which went into effect this past January, but the law will allow governments to reduce duplicate efforts by joining forces to contract directly with physicians.
The district also has racked up savings when meeting the risks associated with a $1.4 billion bond project to build 21 new schools and make improvements on every existing school.
Instead of leaving the insurance to each individual contractor, the district buys the cover for the network of contractors and subcontractors as an owner-controlled insurance program.
This allows the district to oversee the administration of claims and the safety program. The district hopes to achieve estimated savings of $12 million over the five years of the building project, Johnson says.
"This was the first time the district had done anything like that, and Cheryl was very excited to implement the program," adds Fridia.
ARRIVAL: RISK MANAGEMENT
Judging from her career in risk management, one might get the impression that Johnson had set her sights on a career in finance and business early on.
But nothing could be farther from the truth.
In fact, right out of the University of Minnesota, she joined Braniff International Airways and spent 10 highly successful years as a flight attendant.
When she was traveling the world with Braniff as a flight attendant, did she ever imagine she would be working in a position similar to her current one?
"Oh, heavens no," she says now, laughing. But a dramatic career shift was forced on her when Braniff went bankrupt. "I went to the unemployment office, and I lined up an interview with Safeco Insurance," she recalls. They hired her immediately as an adjuster.
"I took a 50 percent pay cut, but I was young and I don't remember suffering that much," she says.
Nearly two years later, she received her first contact with risk management when a scheduled 20-minute interview with the head of risk management at giant Electronic Data Systems turned into a two-hour meeting.
She followed the executive's advice and obtained her workers' comp adjuster's license. This turned out to be a well-timed move, because six months later she was called back to EDS to work as a risk analyst for the information-technology company. She assumed the top risk manager role at the Plano, Texas, company when her mentor left. Her next career move took her into the nonprofit sector, as director of risk management at the Baylor University Medical Center in Dallas.
But the big step up came in 1990, when she saw an ad in the Dallas Morning News that the Dallas school district was looking for a full-time director of risk management. Previously, it had retained insurance brokers to manage the property/casualty side of the district's risk management function, while an outside consultant was used to administer the self-insured worker's comp program.
Once Johnson was hired, she wasted no time putting in place a full-time in-house team that would be able to more carefully monitor and administer the school district's insurance and risk management needs.
In all, within a year, she hired nine full-time staff members: two safety people ("I thought that was especially important," she says); a supervisor of workers' comp so the district could better manage that program; a medical-only adjuster; a property/casualty risk analyst; and four clerical staff.
The number and variety of major risk management initiatives Johnson has put in place for the Dallas school district, plus her prodigious efforts on behalf of the Dallas/Fort Worth chapter of the Risk and Insurance Management Society Inc., culminated in her being honored as one of two recipients of the "Ron Judd Heart of RIMS award," which recognized her for 22 years of contributions to the D/FW RIMS chapter.
"This award has special meaning for me because it came from my peers," Johnson says, modestly.
James E. Huckaby, who is the immediate past president of the Public Risk Management Association and director of risk management for the Mesquite Independent School District adjoining the Dallas school district, has known Johnson for the past 14 years. He says that not only is she a great storehouse of knowledge, but she is a great, giving sharer of information and expertise.
"The thing that sets Cheryl apart," says Huckaby, "is that not only is she concerned about her individual responsibilities--which are massive--she also is concerned as a mentor within the sector of public-service risk management. No matter what subject you may need help from her on, she is willing to send you information on it without any hesitation."
Another person who has been associated with Johnson over the past decade and a half is Dr. John Thornton, just-retired Regents' Professor of Risk Management and Insurance at the University of North Texas in Denton.
"Cheryl exemplifies professionalism--someone who sees what needs to be done and finds ways to do it," observes Thornton, who has known her as a student of his, as well as through much work together at the D/FW chapter of RIMS.
Thornton and Huckaby both underscore that Johnson has been tireless in raising funds for student scholarships and providing internships for students interested in the insurance and risk management realms.
"Her support for students generally is just remarkable," says Thornton. "She has been a rock of scholarship programs throughout the years I've known her." He adds that she has been a regular--and excellent--guest lecturer at his classes as well.
Johnson is an unflagging student herself. She just completed three years at Southern Methodist University, earning certification in advanced graduate studies in dispute resolution, a skill that she may not directly apply in her work at the moment, but which is certainly used indirectly with the many people she deals with. Besides, it was an educational challenge she enjoyed.
Her boss Fridia sums up Johnson's approach to risk management: "She's very knowledgeable about the subject she deals with. She stays on top of things in the industry. She wants to stay on the cutting edge of technology. And Cheryl is a great team player."
Huckaby can't stop the praise either. "Cheryl is always trying to build a better mousetrap," he says. "Her motivation is to have a positive impact on the organization to such a degree that when someone looks at the Dallas school district--whether they're a school board member or someone working in the community--they will see a highly visible program that will cause them to say, 'They've got it together in risk management in Dallas.'"
PAULA L. GREEN lives in New York City. She can be reached at firstname.lastname@example.org. Writer
STEVE YAHN also contributed to this story.
September 1, 2006
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