WICHITA — A decision to revoke Moonwalks for Fun's license to operate inflatables in Wichita was upheld by the City Council this morning.
After a nearly hourlong hearing, the council voted 4-3 in agreement with a city staff recommendation that the license be revoked.
In voting to support the revocation, council member Janet Miller said company owner Duane Zogleman found a way "to scam the system" by using the liability insurance of another company to cover rides operated by Moonwalks for Fun during a gap when it didn't have insurance of its own.
James Clendenin, Jeff Longwell and Michael O'Donnell opposed revoking the license. O'Donnell said Moonwalks for Fun had only a paperwork issue and shouldn't be punished by losing its license.
Under city ordinance, Moonwalks for Fun is prohibited from applying for a new city license for two years.
"It's a real surprise that the city wants to drive us out of business," Zogleman said.
He said the majority of the company's inflatable business is conducted outside city limits and will not be affected.
Moonwalks for Fun owns equipment operated by Pure Entertainment, a facility near Kellogg and Tyler. A 5-year-old boy died after a fall from an inflatable ride at Pure Entertainment on March 22, 2010.
Pure Entertainment will remain open, according to Zogleman's son, Jesse, who manages the facility. Jesse Zogleman said inflatables were only part of Pure Entertainment's business. The facility also is a venue for parties, banquets and other gatherings.
Moonwalks for Fun's license was suspended for 90 days last year. In early October, the company resumed operating inflatables at Pure Entertainment and renting them out around the city.
City officials learned in April that the company's liability insurance was canceled Nov. 3 and it didn't get a new policy with a different company until March 23. Operating without insurance is a violation of the city code for inflatables. The city revoked Moonwalks for Fun's license.
The business appealed the revocation and has been allowed to operate pending the appeal.
Duane Zogleman told the council that he leased inflatables from A Jumping Jungle for use in Wichita during the 4 1/2-month gap when Moonwalks for Fun didn't have liability insurance. At that time, A Jumping Jungle was licensed by the city and carried the necessary insurance for eight inflatables.
Zogleman said he had a handshake agreement with Stephanie Meyer, who operates A Jumping Jungle, and there was no written agreement. Kurt Schroeder, superintendent of the city's central inspection, said city staff and Wichita Police Department made repeated attempts to contact Meyer to confirm the information but were unable to reach her.
Zogleman said there's no city ordinance that says he couldn't rely on the insurance coverage held by another company.
"We were in compliance," he said.
All of the inflatables operated by Moonwalks for Fun, whether at Pure Entertainment or rented to customers in Wichita for such things as parties, came from A Jumping Jungle, Zogleman said.
But after checking through a stack of invoices at Pure Entertainment, Schroeder said his staff found that Moonwalks for Fun rented one of its inflatables to Riverlawn Christian Church in Wichita on March 22 — the day before Moonwalks for Fun obtained liability insurance with a new company.
Zogleman disputed that the company rented one of its inflatables to the church. He said the item listed on the invoice was one of Moonwalks for Fun's inflatables, but the equipment actually used was supplied by A Jumping Jungle. He said the inflatable listed on the invoice was one of a dozen stolen from the company over the last three years.
It was unclear why the stolen inflatable was listed on the invoice, but Zogleman said it was "just an oversight" that the correct inflatable from A Jumping Jungle was not listed.
O'Donnell, whose district includes Pure Entertainment, said he saw Moonwalks for Fun as a "business that has some issues with paperwork ."
"We're going to vote to kick a business out of town that did mess up on paperwork," he said. "There are plenty of business, I'm sure, all across Wichita that occasionally run into issues like this paperwork issues."
Miller said calling it a paperwork issue was a misnomer at best.
"That a company operated for four months off someone else's insurance is unacceptable," she said. "It's a shell game."
Zogleman said he had no problem with the idea of continuing business while using another company's insured inflatables.
"My conscience is clear," he said. "We've spent a lot of money on safety. We've gone beyond industry standards."
Zogleman, who said his family has been operating inflatables since 1976, said he may consider legal action against the city.
This was the third time Moonwalks for Fun's appeal came before the council. It was delayed in May so Zogleman could hire legal help. On June 7, Schroeder asked for a postponement until today after Zogleman came to him right before the meeting and indicated he had new information regarding his insurance. That was in regard to the arrangement he had with A Jumping Jungle.