Citizen urges board to rework insurance

Published 5:00 am Friday, September 5, 2003

A concerned citizen urged aldermen Thursday to exercise goodfiscal management and revamp the city’s employee insurance policyto be more in line with what other area employers areproviding.

South Jackson Street resident John Perkins suggested the boardseek bids on the city’s health and liability insurance policies,get city employees to contribute more for dependent coverage and toconduct pre-employment screening to help ensure the city is gettinghealthy employees.

“These changes need to be made,” Perkins said.

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Perkins said health insurance is the largest single budget item,totaling approximately $1.5 million a year and accounting for 15percent of the total city budget. He said the health insurance,which some part-time city employees are also getting, amounts toover an over $6 an hour benefit and is “way out of line” with whatother employers are paying.

Many citizens are having trouble paying for “Chevrolet”insurance coverage and some can’t afford it at all, Perkinssaid.

“I don’t think the average taxpayer can afford to pay for aCadillac plan for city employees,” he said.

City officials have said the quality insurance plan helps tooffset lower salaries that the city is able to pay.

“It’s hard to find employees that will start for $6 an hour,”said Ward 1 Alderman Dorsey Cameron.

Under the current plan, the city pays all of the employee’sinsurance premium, which totals $5,383 a year for full coverage.After a 24.7 percent increase for fiscal year 2004, that isexpected to go up to $6,751 a year.

For full dependent coverage, employees pay $54.94 a month andthe city covers the remainder. That cost is $11,156 this year andscheduled to be around $14,097 next year.

“It’s way out of the realm of reality of what you do to hire andretain employees,” said Perkins.

He urged aldermen to pay the “prevailing wage” in line with whatother area employers pay and adjust insurance accordingly. He saidhe understood the city is not alone in facing higher healthinsurance costs.

“Some times you’ve got to take some hard action to do the rightthing,” Perkins said.

Responding to Perkins’ comments, City Clerk Iris Rudman-Smithsaid the city sought insurance bids several years ago and got apoor response. Mayor Bill Godbold expressed similar comments.

“Nobody has confronted us wanting to sell insurance of anyshape,” Godbold said.

Perkins said it would be good fiscal management to aggressivelyadvertise for insurance bids rather than have the city’s insuranceagents call around for quotes. City officials maintained that theyhave limited options for insurance carriers.

“We don’t have any control over that which we don’t have anycontrol over,” Godbold said.

Addressing other aspects of Perkins’ comments, Alderman-at-largeLes Bumgarner said altering insurance would amount to a cut insalary. Godbold added that the good insurance, along with stateretirement benefits, is a way the city attracts employees to thelow-paying jobs.

Regarding pre-employment physicals, Rudman-Smith said they arerequired for the police and fire departments but not others. Shesaid City Attorney Joe Fernald is looking into expanding thescreenings to other departments.

“We hope to start that,” Rudman-Smith said.

Godbold said later that the city would contact state InsuranceCommissioner George Dale for assistance with the insurancesituation.

In another budget matter, citizen D.W. Maxwell questioned cityofficials on solid waste operations. He cited proposed budgettotals that show a possible $43,000 surplus next year.

That projection, however, is based on no equipment purchases andincludes no money for any major repairs.

“If we have something to break down, we’re in trouble,” saidWard 4 Alderman Bob Massengill.

Rudman-Smith said there is carryover money to back up generalfund and water and sewer operations, but that is not the case insolid waste. Solid waste operations must be self-supporting throughuser fees and a small property tax levy.

Aldermen are considering privatization of garbage collectionservices. For the city to stay in the solid waste business,Bumgarner said it would require a “substantial increase” infees.

“Something’s got to be done,” he said. “We can’t continue tocount on not having a break down in equipment.”

Maxwell said the current $12 a month rates are reasonable.Officials have estimated, though, that it costs the city about $22a month for garbage collection service.

Maxwell said cable television rates doubled and there was nomajor public outcry. He said garbage and trash collection employeesare doing a good job.

“I think the fees could be raised,” Maxwell said. “I have noproblem with it.”