A snag over liability insurance on a fountain and bench destined for a downtown sidewalk illustrates a growing conflict for Salt Lake City officials torn between art appreciation and fear of lawsuits.

While the immediate problem has apparently been resolved and work is proceeding on the sidewalk, the insurance dilemma threatens to stall several other projects involving artists and the city's 1-percent-for-arts program, which earmarks 1 percent of the cost of public improvements to be spent on art.The city has required artists to indemnify themselves for the life of the artwork against injuries or accidents that can be attributed to the piece.

City officials say the city has to protect itself from the lawsuits of people who may stumble into a fountain or bash their heads on a sculpture.

But some artists and their lawyers say the cost of such protection, even if available, far exceeds the money the city can pay for their works, which averages about $1,000.

"The cost would be so disproportionate that it would effectively kill the whole program," said Chris Wangsgaard, an attorney representing Tom Tessman, one of the artists on the sidewalk project.

Tessman refused to sign his contract with the city because of the liability problem. He and fellow artist Stephen Goldsmith had been working without a contract on the walkway, which links 200 South to the galleries and restaurants on Pierpont Avenue.

Goldsmith said the artists were brought in after much of the design work and some construction had taken place. "We were artists pulled into the fast track," he said. "Artists usually don't work that way."

Assistant City Attorney Larry Spendlove said the walkway artists will avoid the liability problem by having their designs approved by the city engineers' office.

But some say that solution may not work in every case.

Salt Lake City Arts Council Director Nancy Boskoff said the city is trying to put together a policy for administering the percent-for-arts money, but "there are no across-the-board solutions."

Boskoff and Spendlove said the city may have to take out the indemnification clause in cases where artwork poses no perceivable threat, such as a painting on a wall. But both believe there will still be cases where the artist will have to assume some liability.

Wangsgaard said Utah Lawyers for the Arts proposed that the city limit the artists' liability to the amount they are paid for their works, but city officials weren't interested.

He said the artists are willing to accept some responsibility, but it has to be within their means.

"If the limitation is set in some way that it doesn't last forever and doesn't threaten to bankrupt the artists, then I don't see any reason why they can't accept it," he said.

Indemnification clauses do not clear the city of its responsibility, Wangsgaard added. "In general, the city has a duty to make sure it isn't dangerous. They don't get rid of that duty when they get an artist to sign a piece of paper."

David Holz, who administers the percent-for-arts program for the state, said every effort is made to ensure that the artworks pose no hazard, but there is nothing that can be done about a freak accident.