Calling it a "gift that keeps on giving," Chairman Ralph Jones announced last night that the town and union employees have signed a historic agreement Tuesday, March 27, saving the town nearly $1.3 million over the next three years while providing employees with lower health rates but requiring them to accept a new $250 deductible under the new plan.
The agreement, announced before the Warrant Committee Wednesday, March 28, at the brought a round of applause from the fiscal watch dog group of Town Meeting at their weekly meeting.
The newly-found savings for this year, if all allocated to the school department's funding shortfall, and added to newly-discovered revenue, could reduce the school's deficit from $630,000 to just under $280,000.
Yet the Board of Selectmen said in the past they would like to review requests from town departments above their level-service budget.
According to Jones, amendments to the state's municipal health care that were approved by Gov. Patrick in August gave municipalities greater flexibility to make changes to public employee and teachers health insurance including the amount of co-payments and deductibles that are outside of the collective bargaining process.
Towns such as Belmont were given the ability move workers into the state's Group Insurance Commission or another lower-cost plan after negotiating with their unions over a month-long period under a Planned Design plan.
Jones said the Board of Selectmen voted in December to submit to the new process.
With the town's Human Resource's Director Diane Crimmins taking the lead, the 30-day period began with union representative's "very angry" that they were being forced into the position of accepting new costs to their members just after agreeing to long-term contracts, according to Jones.
"But there's not a lot, when you get down to it, to talk about other then how you will mitigate the impact," Jones told Belmont Patch.
Under the amendments to the law, a union can challenge a settlement but only insofar as to dispute the amount of proposed savings to the town and their portion of that amount.
Big change for employees and unions
"It's a big change because the (unions) can not redo all of the contracts to negotiate the compensatory salary adjustments with these anticipated higher employee costs," said Jones.
"The mitigation fund will mitigate the big co-payments that the employees were worried about," said Jones.
But through a series of compromises by Crimmons and her working to help soften the expense blow, employees will see their total cost of insurance fall by 3.5 percent as the unions were provided at least a quarter of first-year total savings under the plan.
"And we gave some extras to the basic mitigation fund over a series of weeks so from (the union's) stand point, the worse part of what will happen to their members has been softened," said Jones.
As a result of the new agreement, the town will see savings totaling $1,290,000 over the next three years; $354,000 this year and $468,000 in the subsequent years.
The school department will take in $212,000 – the department has 60 percent of total town employees – in savings while the town will grab $142,000.
But the Planned Design process does not roll over into the next union contract; the town will need to vote to restart the process.
"And the next if the contracts have not been settled with co-pays included, then we can negotiate those co-pays as part of this procedure," said Jones, predicting that future union negotiations will have deductibles in the plan but also likely with salary or other compensation for accepting that provision.