Source: Sherman Publications

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Twp. medical benefits change aims to reduce legacy costs

by Susan Bromley

October 31, 2012

Brandon Twp.- On Oct. 29, during what was their second to last meeting, the current township board discussed legacy costs and how they could reduce the bill that the township will bear in the future for employees' healthcare benefits.

Toward that end, the board approved by a 5-1 vote a motion that full-time elected officials (excluding trustees) and full-time employees elected/hired after Oct. 31, 2012 will be responsible for paying 20 percent of their health insurance. Treasurer Terry Beltramo voted no. Trustee Tom Stowell was absent.

Currently, full-time employees and full-time elected officials (supervisor, clerk, and treasurer) have co-pays and deductibles if they choose the healthcare benefit, but do not contribute to the premium.

Supervisor Kathy Thurman said the board took the action to decrease the township's legacy obligations, as well as their benefit obligations, "because the cost of medical insurance has increased so drastically over the last few years."

"We are supposed to be stewards of the township funds, so this is a way to offset those costs looking into the future," she said.

The change in policy applies to all municipal employees that are hired full-time henceforth, including township firefighters.

The look of the township board will change dramatically after Tuesday's election, with at least five new members elected, and the new medical benefit policy will apply to the presumed treasurer-elect, Terri Darnall (the sole treasurer candidate). The new policy will not, however, apply to presumed clerk-elect Candee Allen (the sole clerk candidate), as she will continue to collect her full benefit as a township retiree (she worked full-time as a recreation assistant for more than 20 years).

"The biggest issue I have dealt with on the board is the budget and maintaining the fiscal integrity of the township," said Trustee Cheryl Gault. "There are still huge liabilities on our balance sheet and it's my hope the new board will maintain a budget that can reduce those liabilities."

Township officials are hoping to receive their OPEB (Other Post Employment Benefits) actuarial report in a few weeks. The township approved in September a $3,600 contract with Watkins, Ross & Co. to provide an actuarial evaluation to determine legacy costs for retiree healthcare. Thurman notes the state requires an actuarial evaluation be done every three years. Currently, the township pays for retiree healthcare benefits out of the general operating fund and the fire department operating fund. The township hopes in the future to pay the benefits from a healthcare funding vehicle only.