Gretna retirees will have at least one more year of discounted health insurance after the City Council decided this week to reinstate a previously eliminated benefit, but the decision came with a warning that the move likely was temporary. The council unanimously approved Councilwoman Belinda Constant's request Wednesday to continue the city's cost sharing program for retiree health insurance...
Gretna retirees will have at least one more year of discounted health insurance after the City Council decided this week to reinstate a previously eliminated benefit, but the decision came with a warning that the move likely was temporary. The council unanimously approved Councilwoman Belinda Constant's request Wednesday to continue the city's cost sharing program for retiree health insurance at a cost of about $60,000. The benefit, which was started in 2009, had been eliminated from the budget in April at the request of Mayor Ronnie Harris to save money.
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But council members and affected retirees argued that Harris' decision was unfair because employees retired from city jobs expecting help with their premiums. The city pays 3.3 percent of employees' premiums for every year of service. Most of the retirees had at least 20 years of service when they retired, and some spent more than 30 years on the job.
Rudy DuSaules, who retired as finance director, said older employees were enticed to retire to reduce the city's payroll with the promise of low health insurance premiums until they could qualify for Medicare. Most were never notified the benefit was based on the city's financial situation, even though that clause was part of the guidelines approved by the council, DuSaules said. Councilwoman Raylyn Beevers said the city's decision to eliminate the benefit was abrupt and poorly handled by the administration.
"When these people retired, they planned on receiving these benefits," Beevers said. "They went from having a benefit to being told to come in and pay for their insurance."
Constant's ordinance restricts the benefit to those employees who have already retired. She also sponsored a companion ordinance that reduces the city's percentage of the premium to 2.5 percent per year of service beginning in October.
Harris said he recommended cutting the benefit because declining revenues cannot continue to support the rising cost. About 10 former employees receive the benefit and costs have gone from less than $10,000 when the program began to more than $60,000 today. Harris said Constant's changes that would exclude current employees from the benefit are unfair. In addition, some retirees have left full-time city service in one department, only to work part time to earn extra money and maintain all of their benefits.
Councilman Vincent Cox III echoed Harris' concerns. Cox said his constituents have little sympathy for the plight of city retirees given conditions in the private sector. Next year, the city could face a $1 million budget deficit, and it needs to start making tough decisions now, he said.
"I don't understand where we're going financially in this city," Cox said. "We're playing Russian roulette with money that ain't ours."
However, Cox and Harris ultimately relented and supported Constant's ordinances when other council members promised that eliminating the benefit would be considered again in March.
Police Chief Arthur Lawson, who employed many of the retirees in his department, said the delay should help them make contingency plans.
"I think what you're talking about will give people a chance to prepare," Lawson said. "I think that it's a sad situation."
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Allen Powell II can be reached at apowell@timespicayune.com or 504.826.3793.