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Tuesday, October 8, 2013

Taxpayers Suffer: Portsmouth City Council Gets Cheap Insurance for Last 16 Years

Is someone dazed and confused at city hall again? This report appeared in the online Portsmouth Daily Times edition of October 8, 2013:

"A 1997 story in the Daily Times read - 'Members of the Portsmouth City Council will now pay 20 percent of their health insurance benefits.' The story goes on to say - 'The benefits have been at the root of a controversy which included an effort to recall council members. The decision to pay for some of the benefits became official in a meeting Monday. But instead of toning down the controversy surrounding the issue, the move has simply added fuel to the fire for a citizens group that insists Council members shouldn’t receive health insurance at all.'

"The kicker is that City Council members do not pay 20 percent for their health insurance (as of October 8, 2013). Instead, they pay the same per month as city employees which is $80 for the single plan and $200 for family coverage for union members and $25/$50 for non-union employees."

(Frank Lewis, "Council Insurance Rates Under More Scrutiny," 
Portsmouth Daily Times, October 8 2013)

I read these sentences and the rest of the story over and over, and I kept asking myself, "How could such a SNAFU have gone unnoticed and uncorrected for so long? 1997? That amounts to sixteen years of governmental misappropriations. Was someone foolish minding the store and the pocketbook, or was the discrepancy "overlooked" on purpose? Either way, a thorough and responsible city government would never have allowed this to occur. 
Voters will soon decide whether to approve a pay increase for members of Portsmouth City Council. Now, according to the Times, council members are paid $600 per year while the President of Council is paid $1,000 per year -- counting all six council members, that total is $4,000 per year. Council is asking voters to take their annual pay from $600 to $5,000. Of course, that figure totals to $30,000 a year.

As part of that approved  raise, Council members would lose their city-paid health benefits, forcing them to either not have coverage through the city or paying the entire cost of the premium.

Salaries have not gone up since 1928, and the yearly increase in insurance costs has been approximately 15 percent. And the potential increase for 2014 is, according to figures from City Council, 40 percent. A significant portion of this increase is due to health insurance claims running at $1.07 for every $1.00 paid in premiums. With the current pay scale, add in an insurance cost potential of $113,825.

How Could We Right This?

It's evident the mistake cannot be billed to council members considering changes over the last sixteen years. Besides, who is really responsible for the miscalculations and underpayments of the premiums? This appears to be another case of city hall "fumbling the ball" and "good old boys just getting by."

But, the truth is that someone with a big enough calculator and a degree in accounting could research files and determine who took and who declined the coverage, how much those insured underpaid, and come up with a figure that would come close to compensating the coffers. That figure could then be considered in determining just how much of a pay raise current council members should receive.

That would mean compromise -- and, of course, that is a word foreign to the vocabulary of Portsmouth City Council. Maybe, in good faith, council could ask voters to approve annual pay of $3,500, or maybe they could ask voters to approve raising their pay in steps over several years to  reach the $5,000 maximum figure.

What council members hang onto their jobs to get their health insurance premiums paid? 

First Ward Councilman Kevin W. Johnson said some council members have the family plan, which means they are receiving some $18,000 per year in addition to their salaries. That is a nice perk: one that surely has the power to draw "hangers on" who want a position with a golden benefit.

And, First Ward Councilman Kevin W. Johnson is asking the question - “Should the article’s reference to Council paying 20 percent of premiums be in effect today? Members with single person insurance would be paying some $120 per month instead of the required $25. And those with a family plan would be paying some $285 per month instead of the required $50.”

DUH? What is the agreement? Two wrongs do not make a right. If the truth is evident today, then duty requires someone to enforce the contractual agreement. Of course, negotiations should be honored, and the change should take effect immediately.

It seems, as usual, the citizens of the city are losing ground in another Catch 22. The Martings' fiasco, the crumbling city building woes, the speed traps set in 25 MPH school zones that no long exist, the trash pick up days on a dizzying merry-go-round schedule, the private use of city owned property, the locked restrooms in city parks, the indifference over missing persons, and now the "good deal" insurance or "raise my salary" dilemma.

Johnson said the amendment’s fate will determine his rate. I'll let Councilman Johnson describe the choice as it stands for Portsmouth voters:

“I voluntarily choose to pay $80,” Johnson said. “Should the amendment not pass, I will advise the Treasurer’s office to have my payments revert back to $25 instead of $80 per month.”

“If the charter amendment fails, the inequity in remuneration will not only continue but shall be more expensive should insurance rates for the city increase by the anticipated 40 percent,” Johnson said. “Members of Council with family health insurance would be getting some $24,000 in yearly remuneration.”

Well, well ...  paying sixteen years of the cheaper premiums, raising the current salary (x 8.3)  to $5,000 and still giving council the city worker insurance "pool perk" of a very low monthly $80 single/$200 family. Not bad for a part-time job.

This really amounts to a decision of "you can pay me" or "you can really pay me." What stinks? Once again we spiral in downward circles with the flush of refuse into a big black hole. Who's on first? That's right -- who?

Seat of city hot dog government
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