BY ADAM ATKINSON
North Country This Week

CANTON – The town board has passed a resolution increasing the premium contributions for the supplemental insurance it provides for its retirees and their survivors from the 20-25 percent range to 35 percent for 2021. The amount will go up to 50 percent for 2022 for the 12 people who have the insurance.

The move is in response to the 2017 state audit which leveled several criticisms at the town over how it handled town provided insurance for retirees, employees and officials. The board passed the resolution at its meeting Thursday, Dec. 10, along with a second resolution increasing the contributions of non-contract current employees from 20 to 25 percent. A third resolution modifying the contributions of certain elected officials -- town clerk and town highway superintendent -- was tabled. Town highway employees, working under a negotiated contract will continue to pay contributions established in their contract.

“So the board has grappled with this for a few years because of the state audit and other contributing factors,” said Ashley.

When a town is audited by the state comptroller’s office and they cite certain things, the town has to come up with a corrective action plan, the supervisor said. The town was cited in four different areas of health insurance in the 2017 audit, she said.

The board discussed the issue during the 2020 budget deliberations, Ashley said.

The resolution passed by the board Thursday cites rising healthcare costs for town workers and retirees over the years, and said the town currently pays over $250,000 annually for this health insurance. The resolution said the state criticized, among other things, the town’s practice of “collective contributions less than required by policy and or contract and providing health insurance to individuals who were not eligible.”

At the meeting, town retiree Dick Dudley argued that the issues with the discrepancies dealt with other employees and not the current retirees and survivors receiving insurance. He also argued that non-highway retirees had worked under a contractual type of arrangement which promised them insurance as a benefit.

“We’ve (the retirees) have taken the position all along that we also have a contract,” Dudley said. “I worked for the town for 29 years. During that time the town gave me, as a benefit, health insurance, including health insurance, (and) retirement health insurance. I worked for that. I worked 29 years for the town of Canton. When I retired I expected the town to honor the contract we had, that they were to pay me, to pay my benefits until death. How am I differing from the highway department.”

“Was that a written agreement Dick?” asked Ashley.

“It doesn't have to be written,” Dudley said. “They said they would do it for me and I worked. In return for my work they were going to do this for me. I performed my end of the bargain. You aren’t performing your end of the bargain.”

“What we are finding here is that there were a lot of agreements, some written some not, that transpired over the years. And here we are at the point where different people believe they retired under different agreements,” said Town Councilman Tim Danehy. “But what we have is the state telling us that we are not collecting what we are supposed to from the retirees. And that the town has the ability to amend those agreements as necessary. So it's a difficult, difficult spot for us to be in.”

“My concern in terms of this year is that there were a lot of moving pieces in this. And I wish we had gotten these notices out quicker because we bumped up against the open enrollment deadline (for state health insurance) in way that didn’t work out very well. And we need to be sensitive to that,” Danehy said.

Dudley said he appreciated the town’s situation, but argued that the town doesn’t have to always comply with Albany’s mandate.

“The state people can claim that you don’t have to honor it (the insurance benefits), but they don’t have to defend a lawsuit,” Dudley said. “And, I don’t want to start a lawsuit. I want to get this settled.”

Dudley said retirees have settled with the town on increases in the past after working together on a solution. He said this most recent increase was announced to retirees in a recent letter. “We should have been consulted previously and been able to have an opportunity to discuss this,” Dudley said.

Town Councilman Bob Washo responded by saying the issue of the increase was discussed last year as well, and the board decided not to take action on the increase at that time. “I beg differ. That this letter did not come out of the blue, that this is the second time we are having pretty much the same discussion,” Washo said. “And the pressure on us over it hasn't really changed since then.”

Dudley said the increases in the past were designed to keep the retirees in line with the percentage of premiums that the retirees had previously agreed to and this current increase was substantially higher.

During discussion, Town Councilman Jimmy Smith pointed out due to the timing of the increase this year the town retirees would miss the open enrollment period for state insurance. He proposed that the town increase the contribution amount to just 35 percent instead of initially proposed 50 percent for 2021 and then bump it to 50 percent to 2022. The graduated increase would allow the retirees to have a year to research other options, Smith said.

“I’m not happy about this, none of the board board members are happy about this. But we have people (the state) telling us ‘Why are you supplementing retirees health insurance on the backs of the taxpayers?’” Smith said. “And, basically that’s what we are doing and that's what they are telling us is wrong.”

The board agreed to amend the initial resolution to allow the lesser increase for 2021 with the increase to 50 percent for 2022.

During discussion, town retiree Linda Curry criticized the timing of the increase. “It just seems really, really wrong to me all ways around. If this is going to be raised we should have had the chance to talk, for me to talk to the board,” Curry said. “And we also should have had a lot more notice.”

“Going up to 50 percent is a lot on the backs of the people,” she said. She said she believed that there were other places the town could cut in its expenses to save money and not have a negative impact on its retirees. She asked if there would be a fine from the state if the town did not raise the contributions to 50 percent in an effort to comply with the state’s audit. Town board members could not confirm if a fine would be levied, just that it was against state policy.

Town Councilman Jimmy Smith said the town had put off taking action on the insurance premium issue and the auditors “were not happy” about it. “You can’t just continue to put off what needs to be done,” Smith said. “That’s our job. It’s not fun sometimes, but that’s our job.”

Washo said he looks at the increase as being a difficult, but necessary decision to insure the future solvency of all insurance for town employees and retirees given the financial climate.

Dudley said he had agreed to the insurance costs over the years during his employ in lieu of pay raises and other benefits. “And, I feel like you are taking advantage of me now for my 29 years of working for the town,” Dudley said.

“I would just like to comment that we are doing this in response to an audit the state has done. We are not trying to take advantage of the retirees and we would not be an effective board if we were not responding to the state’s request,” said Town Councilwoman Karin Blackburn.

Dudley said the town has had a lot of audits over the years and has not always responded to the state’s criticism to Albany’s liking. “They (the state) would like to see everything in writing and make their job easier. Well, its not your job to make their job easier,” Dudley said.

During later discussion on the increase of premium contributions for current employees, town court clerk Marc Armstrong asked if the town had researched other insurance package options that might have been cheaper to offer employees.

“We have been looking at different plans but we are not there yet as far as which ones to recommend,” Ashley said.

Blackburn added that even if the municipality was able to find other options, the overall cost to the employees would still increase as the amount of out-of-pocket medical cost levels increased with plans that offer a cheaper up-front premium.