Borough insurance up

MAT-SU -- Increasing insurance costs have hit the Mat-Su Borough's employees, and the borough assembly, in December, approved an arrangement that would help keep employee premium payments at an even level.

Borough insurance premiums are escalating, Tammy Clayton, the borough's finance director told assembly members at their Dec. 17 meeting.

"We anticipate up to as much as $260 a month per employee," Clayton said of the expected increase.

The increase is partially the result of a nationwide rise in insurance costs and partially from a number of large, multi-year claims that were filed recently.

Currently, the borough pays about $600 per month per employee as a contribution to employee insurance. Employees pay about $70 per month. In order to look at options to offset the spike in insurance costs, a committee was formed to study the matter. Borough manager John Duffy told the assembly that, after about seven months, the committee brought back a few suggestions.

The labor agreement signed in 2000 by the borough and the Mat-Su Borough Employees Association stipulates that the borough will pay $600 per month in 2002 and $625 per month in 2003. With the rising insurance costs, that could have left borough employees with monthly insurance costs of up to $330.

To offset the dramatic increase, the committee tapped into an old, rarely used component of the employee setup -- the Sick Leave Bank. The bank, Duffy told assembly members, was created before the Family and Medical Leave Act, which adopted as law a means of providing employees with additional medical leave. Employees, Duffy explained, donated four hours of personal leave time to the bank each year.

The committee recommended cashing in the time that was still sitting in the bank -- at an estimated value of nearly $50,000. In addition, each employee will contribute eight hours of personal leave to the borough, saving the borough about $49,000.

That move was coupled with a $165,600 appropriation from the borough's Areawide Fund Balance, a portion of the $500,000 that was lapsed to the borough by the school district.

The money, according to information included with the resolution, will be placed in a new reserve account -- enough, Clayton said, to cover the cost of insurance through the end of the fiscal year. That's the same time, she explained, that the MSBEA labor agreement expires.

"What I like about this [agreement] is, the employees are meeting us halfway," said assembly member Sara Jansen.

Assembly member Talis Colberg objected to the borough's asking taxpayers to fund what he saw as a virtually unlimited additional insurance payment.

"This is a problem that doesn't get better by simply covering the increase," Colberg said.

When it came to a vote, the motion passed with Colberg and Bruce Bush voting against the matter.