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Legalities and Risk Management for a Fair, Festival or Event

The complexity of your festival will probably determine which permits and licenses you need. Put one person in charge of tracking them down. Licensing raffl es and other types of gambling was mentioned earlier in this booklet. The need to obtain necessary permits associated with the sale of food and beverages, and to follow health department regulations was also discussed earlier.

Event organizers may want to consider registering with the state as a nonprofit corporation. Reasons for doing this include protecting individual board members from lawsuits against the event, and registering as a nonprofit corporation may be required for certain permits and licenses.

A separate and additional consideration is to apply to the Internal Revenue Service (IRS) for tax exempt status. The IRS has prepared Publication 557, "Tax Exempt Status for Your Organization," that will answer most questions about filing requirements.

Risk management involves identifying and eliminating or reducing potential claims through and in-depth risk assessment. Insurance policies can be purchased to cover known and unknown hazards such as weather conditions (wind, rain, hail), fire, personal injury, property damage, general liability, concessionaire's liability (you can have a policy to insure them), theft, workers compensation, and performer "No-Show." This is not a complete list. Consult legal council and/or an insurance representative for further details.

Do not overlook security plans. Chances are police protection will not be needed. However, if some incident should arise and law enforcement offi -cials are miles away, a situation could get out of hand very quickly. Because of this possibility, local governments frequently have regulations addressing police patrol at public events.

Liability insurance is a critical issue for most festivals. The risk of accidents or damage with almost every aspect of your festival opens it up to litigation if an accident occurs, no matter how insignifi cant it may seem. Review and update your liability insurance policy on an annual basis. You may wish to require additional coverage for some events and you may require certain vendors or entertainment to carry their own separate policy.


 

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