CLT UPDATE
Thursday, October 4, 2007
Taxpayers shoveling against the tide
Despite what Vennochi suggests, taxes is not "a dirty
word" to us when they're reasonable with good results. However, the
following is a dirty phrase: extraordinary taxes that are used to
provide public employee pension and health insurance benefits that we
private-sector taxpayers must provide but will never have ourselves.
The Boston Globe - Letters to the editor
Wednesday, September 26, 2007
Debt and taxes
by Barbara Anderson
A Randolph school superintendent handed $580,000 three years
ago in a bitter buyout is pulling in the highest pension of any retired educator
in the Bay State, a Herald payroll analysis shows....
This year the state is chalking up $1.5 billion in pension payments to
46,000-plus retired teachers and administrators. The average annual check is
$33,000. School employees and municipalities contribute to a statewide teacher
retirement system that administers pensions for all retirees.
The pension program, educators argue, is a priceless perk....
But state taxpayers this year still had to prop up state pensions with $1.4
billion because the state failed to fund the program for decades.
“One out of every $20 we pay goes to pensions,” says Michael Widmer, president
of the Massachusetts Taxpayers Foundation....
And when it comes to paying for all that, it translates into higher property
taxes, says Barbara Anderson of Citizens for Limited Taxation.
“When you’re dealing with overrides, teachers’ unions are the ones out there
promoting them,” she said.
The Boston Herald
Wednesday, September 26, 2007
Educator payouts top $1.5B
‘Outrageous’ pensions panned
After months of slow-moving negotiations, the Canton School
Committee has reached a tentative contract agreement with the teachers
association.
“We’re obviously optimistic that the teachers will accept the agreement,” said
School Committee Chairman John Bonnanzio. “It’s been a very difficult and long
negotiating process.”
Voters shot down a $3.95 million Proposition 2½ override in January that would
have greatly helped the school system, which has since been forced to cut $1.4
million from its budget, including eliminating nearly 30 positions.
The Canton Journal
Wednesday, September 26, 2007
Tentative agreement reached with teachers
So politicians wonder why cynical taxpayers won’t cough up
another dime?
Here’s why.
Another day, another scam.
And they’ve done nothing to fix it....
Yesterday we also learned that drowning-in-debt Randolph, so broke it canceled
most school buses, bought out the contract of a superintendent -- for $580,000.
That same educator, Arthur Melia, now gets an annual pension of $145,332, thus
joining 54 other retired school administrators in The $100,000-Plus Club.
Why, you might ask, the mad rush to ditch Melia when it cost cash-strapped
Randolph more than a half-million dollars -- almost exactly what ditching the
buses saved? ...
By the way, did you hear the one about the Gloucester lawyer who hired a detail
cop for $40 an hour, but didn’t realize union rules there say a cop must be paid
for eight hours, even if he only works for one? Well, attorney J. Michael
Faherty would cough up only $160 for a two-hour detail, reports The Salem News.
The police filed criminal charges against Faherty, who’ll probably lose.
The Boston Herald
Thursday, September 27, 2007
It’s no mystery why taxpayers are so fed up
By Margery Eagan
Just how dumb do those on Beacon Hill think we are?
Well, voters must be pretty stupid in politicians' estimation, judging from the
statements they make and the votes they take.
These days all the talk at the Statehouse is about the pressing need for the
millions of dollars that might be generated from casino gambling.
"It's either that or raise taxes," the governor and lawmakers tell us.
But there's a third option that they're loath to talk about -- cut government
spending, particularly in the area of public employee health care and
pensions....
The sad fact is that, as has been noted here before, legislators are more
frightened of the unions than they are of the average taxpayer. Until that
changes, voters will apparently have to choose between paying more taxes and
tolls or bellying up to the blackjack table.
A Salem News editorial
Thursday, September 27, 2007
Taxpayers still an easy mark on Beacon Hill
Union organizing just got easier for government employees in
Massachusetts. Governor Deval Patrick signed a bill yesterday that allows
employees to organize through "card check" drives, rather than secret ballots.
Union officials applauded the measure, which had been vetoed by Governor Mitt
Romney last year and denounced by some business leaders, who said workers would
be intimidated into voting in favor of unionizing.
The Boston Globe
Friday, September 28, 2007
Patrick signs bill to ease union organizing
There will be no health insurance savings next year for the
town of Swampscott or its employees.
Negotiations between the town, trying to implement the Board of Selectmen’s
decision to advocate that town employees switch from their present 400-member
pool to the 286,000-member pool of state employees for health insurance, have
reached “impasse,” Town Administrator Andrew Maylor told town employees and
elected officials in an e-mail sent at 11:15 a.m. Friday, Sept. 28....
Clearly frustrated, Maylor ends his letter with a question: “Why weren’t
comparable benefits, at reduced costs and the chance to save jobs enough?” ...
[In his letter he wrote] “The question is, ‘Should the town give back a portion
of its savings to the employees covered by the town’s health insurance by
increasing the percentage the town pays toward health insurance?’ It is the
opinion of the unions and retirees that it should. It is my personal opinion
that it should not....
“If at the 60/40 split the town saves $800,000, where do you think that money
will go? Seventy-five percent of all budgetary spending goes to the employees:
salaries, retirement, health insurance, workers compensation, uniform
allowances, etc ...
“Why weren’t comparable benefits, at reduced costs and the
chance to save jobs enough?”
The Swampscott Reporter
Friday, September 28, 2007
State GIC health plan is ‘unattainable,’
frustrated administrator writes
Massachusetts public school teachers who've taught in private
or parochial schools want Beacon Hill lawmakers to change the state's retirement
law to allow their time teaching at private schools to count toward their state
pensions....
The Massachusetts Teachers Association and several area lawmakers said the
change would remove an unfair distinction between public and private school
teachers....
Teachers want the change at a time when the state is spending more than $1
billion a year to close a $13.3 billion pension shortfall. The gap between what
the state owes retirees and what it has socked away was the combination of bad
planning, loopholes exploited by retirees, and the Legislature's decision to
extend benefits to certain groups.
Indeed, the teacher bills were just a few of the 75 bills that would broaden
pension benefits the Public Service Committee heard testimony on yesterday.
The Senate Ways and Means Committee put the cost to the state
of this buyback at $75 million.
The Salem News
Friday, September 28, 2007
Teachers seek pension credit
for private school years
House Speaker Sal DiMasi is talking tough about the new law
aimed at saving cities and towns millions of dollars in health care costs and
giving property tax relief to homeowners -- you know, the law that is miles away
from reaching its goal?
In a speech to business leaders on Friday, DiMasi raised the point we’ve been
making for months -- that giving cities and towns the option of enrolling their
workers in the Group Insurance Commission -- and giving local union leaders what
amounts to veto power over such a change -- may not achieve the desired results.
The original deadline for communities to decide whether they would enroll their
workers in the GIC was yesterday. By close of business, only three towns and
four regional school districts had notified the GIC of their approval.
Legislative leaders plan to extend that deadline by a month.
“Let me say here, if I see in the first year that the labor unions don’t agree
and are continuing to block this reform, then we are going to take them out of
the equation,” DiMasi said in remarks to Associated Industries of Massachusetts
on Friday....
DiMasi should rethink his willingness to give the new law an
entire year to bear fruit. A report released in August suggested communities
could realize $102 million in immediate savings by enrolling their workers, and
$2.5 billion over the next 10 years if all municipal employees were enrolled.
We won’t get there -- and the taxpayers have zero chance of realizing the tax
relief they’ve been promised -- as long as enrollment is merely an option.
A Boston Herald editorial
Tuesday, October 2, 2007
Speaking the truth on health costs
The executive director of the state's $50 billion public
pension fund could add $129,000 to his $322,000 annual salary under a bonus plan
approved yesterday by the fund's trustees that will also pay bonuses to the
agency's 23 other employees....
But some lawmakers said the plan -- which could cost as much as $950,000 a year,
based on current salaries -- is too expensive, especially given the state's
shaky finances.
"I don't think you'll find anybody in another state agency who has this type of
arrangement," said state Senator Richard R. Tisei of Wakefield, the Republican
minority leader. "Even in the private sector, people aren't receiving bonuses
anywhere near that amount. They seem a bit exorbitant. One of the pitfalls of
having an independent agency is that it marches to its own drummer."
The board approved the plan without public input.
"I find it interesting how quickly a plan that raises salary expenditures can
come to pass, yet how long it takes to reform other abuses of the pension
system," said state Representative Bradley Jones of North Reading, the House
minority leader. "This plan was devised, brought forward, and implemented
essentially overnight. Maybe there's a rational basis for doing it. But there
are other problems with the system we see on almost a daily basis, and we can't
get them addressed. That's what frustrates the public."
The Boston Globe
Wednesday, October 2, 2007
Bonus plan approved for pension fund employees
City firefighters' sick days could hit a new high this year,
[Peabody] fire Chief Steve Pasdon warned the department in a memo late last
week.
Firefighters have called in sick 1,280 days so far this year, according to the
chief, who projected the number will rise to 1,706 by the end of the year, up
from 1,418 last year and 838 the year before. Last year, the number of days
firefighters called in sick -- an average of nearly 16 per person -- required
the City Council this spring to appropriate an additional $100,000 in overtime
for coverage of those shifts....
"The differences between the chief and the union are the worst they've been
since I've been here," union vice president Steve Rizzotti said. "And I've been
here 20 years."
The Salem News
Wednesday, October 3, 2007
Firefighter sick days peaking, chief warns
Chip Ford's CLT Commentary
"So politicians wonder why cynical taxpayers won’t
cough up another dime?" wrote Boston Herald columnist Margery Eagan.
"Here’s why. Another day, another scam."
She's right, if coming down perhaps on the
conservative side: I'm not sure we can even keep up with them,
that there aren't more than one a day. This CLT Update covers a
mere week's worth of exposure.
And the way the scams are spreading and increasing, I
tend to think we taxpayers can never catch up with bailing out the
state's liabilities in our name.
Thanks to the Legislature and Governor,
public employee union organizing just became easier last week, as if it
was ever difficult.
Swampscott was unable to get its unions to
agree to switching its health insurance plan from Blue Cross to the
state's less expensive GIC plan, though the coverage would remain the
same: Not unless the public employee unions' members got the
savings, not the town and its taxpayers. [See the CLT Update of
Sep. 24, "Public
employee unions' greed killing local services"]
Randolph handed a $580,000 early buy-out to a
school administrator, and now pays his $145,332 a year pension on top of
it, as well as health insurance for life even while he was hired in
Rhode Island. Meanwhile, "Randolph has lost: 70 teachers, one elementary
school, a remedial-reading program and most foreign languages. Only
Spanish remains, and only at the high school," Eagan wrote. The town is
"so broke it canceled most school buses."
The state teachers union, Massachusetts
Teachers Association, is pushing the Legislature for an expanded pension
credit -- to cover teachers who teach in private schools -- estimated to
cost taxpayers an additional $75 million.
The director of the state's public pension
fund just got a potential $129,000 raise from his $322,000 annual salary
with a "bonus," bringing his annual salary to $451,000 -- and the bonus
was extended to 23 others in his pension fund crew. Some have
estimated the additional cost to reach "$950,000 a year." All this
despite the state pension fund costing taxpayers $1.4 billion this year
alone, anticipated to be in the red and needing our annual bail-out
until at least 2023.
Firefighters in Peabody (and in how many
other municipalities?) are calling in sick in record numbers, forcing
the city to spend more on overtime to fill their jobs. Naturally,
the union defends this practice, and naturally as well, this increases
firefighters' salaries.
"So politicians wonder why cynical taxpayers won’t
cough up another dime?" Eagan sarcastically asked. It sounds like
pure self-defense to me.
 |
|
Chip Ford |
The Boston Globe
Wednesday, September 26, 2007
Letters to the editor
Debt and taxes
According to Joan Vennochi ("Let the people pick their poison," Op-ed,
Sept. 23), I helped push Bay Staters to the juncture of the road on
casino gambling because I "led the antitax crusade that resulted in the
passage of Proposition 2½." I'm sure that we 59 percent of the voters
who desired to limit the property tax weren't thinking in 1980 that
casino gambling was the answer to the state's extraordinarily high tax
burden. After all, most states had lower tax burdens yet no gambling or
even lotteries at that time.
Despite what Vennochi suggests, taxes is not "a dirty word" to us when
they're reasonable with good results. However, the following is a dirty
phrase: extraordinary taxes that are used to provide public employee
pension and health insurance benefits that we private-sector taxpayers
must provide but will never have ourselves. The choice today is even
higher taxes, casino gambling, or reform of a government system that
exists to take unusually good care of itself instead of providing good
services. Let's do choice number three now, before we debate the other
two.
Barbara Anderson
Executive Director
Citizens for Limited Taxation
Marblehead
The Boston Herald
Wednesday, September 26, 2007
Educator payouts top $1.5B
‘Outrageous’ pensions panned
By Joe Dwinell
A Randolph school superintendent handed $580,000 three years ago in a
bitter buyout is pulling in the highest pension of any retired educator
in the Bay State, a Herald payroll analysis shows.
Arthur Melia receives $145,332, joining 54 other retired school
administrators awarded a six-figure retirement cushion to fall back on,
pension records show.
“The buyout amount was absolutely outrageous and his contract was
absolutely outrageous. That’s why he’s No. 1 on your list,” said
Randolph School Committee member Tamara Pitts. A recently elected member
of the committee, Pitts said Melia’s payout compelled her to run.
Melia could not be reached for comment.
This year the state is chalking up $1.5 billion in pension payments to
46,000-plus retired teachers and administrators. The average annual
check is $33,000. School employees and municipalities contribute to a
statewide teacher retirement system that administers pensions for all
retirees.
The pension program, educators argue, is a priceless perk.
“It’s a major tool in holding onto teachers,” said Paul Toner, vice
president of the Massachusetts Teachers Association.
Newer teachers, he added, are actually “self-funding” the pension
program by contributing 11 percent of their pay into the retirement
system.
But state taxpayers this year still had to prop up state pensions with
$1.4 billion because the state failed to fund the program for decades.
“One out of every $20 we pay goes to pensions,” says Michael Widmer,
president of the Massachusetts Taxpayers Foundation.
“It underscores the importance of fixing abuses in the system,” Widmer
added.
When you add the educators and retired state workers up, the state’s
pension pool now goes 90,000-plus workers deep.
And when it comes to paying for all that, it translates into higher
property taxes, says Barbara Anderson of Citizens for Limited
Taxation.
“When you’re dealing with overrides, teachers’ unions are the ones out
there promoting them,” she said.
As the state’s pension program now stands, taxpayers will be carrying
the load until 2023, when it will be fully funded.
“The plan was not funded adequately until 1990” and now we’re paying for
past sins, said James Lamenzo, the state actuary in charge of keeping
the pension program afloat.
Go online to the “Your tax dollars at work” report at
www.bostonherald.com for a complete list of all 90,000 pensioners in the
state.
The Canton Journal
Wednesday, September 26, 2007
Tentative agreement reached with teachers
By Jeff Mucciarone
After months of slow-moving negotiations, the Canton School Committee
has reached a tentative contract agreement with the teachers
association.
“We’re obviously optimistic that the teachers will accept the
agreement,” said School Committee Chairman John Bonnanzio. “It’s been a
very difficult and long negotiating process.”
Voters shot down a $3.95 million Proposition 2½ override in January that
would have greatly helped the school system, which has since been forced
to cut $1.4 million from its budget, including eliminating nearly 30
positions.
In June, teachers stood unanimously opposed to the 0-percent raise the
administration was offering this year.
The union was expected to take a formal vote on the proposal Monday,
Sept. 24.
Bonnanzio thanked the union leadership and said they bargained in
earnest and in good faith throughout the process.
For the current school year, the projected budget would have been nearly
$26.4 million, but with the override rejected, officials cut the budget
to $24.9 million.
Negotiations with the custodial union remain active, said School
Committee member Reuki Schutt.
The Boston Herald
Thursday, September 27, 2007
It’s no mystery why taxpayers are so fed up
By Margery Eagan
So politicians wonder why cynical taxpayers won’t cough up another dime?
Here’s why.
Another day, another scam.
And they’ve done nothing to fix it.
Last week it was the 40-something state trooper retirees with their
pensions of $100,000-plus. Then it was the ex-principal of King Philip
Regional High and his healthcare-for-life-deal, which Massachusetts
taxpayers are still funding, though Michael Levine now works in Rhode
Island.
This week it’s the drowning-in-debt Turnpike losing hundreds of
thousands of dollars at a clip because no one noticed all these
discount-toll cheaters. Better late than never.
Yesterday we also learned that drowning-in-debt Randolph, so broke it
canceled most school buses, bought out the contract of a superintendent
-- for $580,000. That same educator, Arthur Melia, now gets an annual
pension of $145,332, thus joining 54 other retired school administrators
in The $100,000-Plus Club.
Why, you might ask, the mad rush to ditch Melia when it cost
cash-strapped Randolph more than a half-million dollars -- almost
exactly what ditching the buses saved?
He’s a Randolph native. He worked for Randolph schools his entire
educational career, said School Committee Chief Larry Azer yesterday.
He’d been superintendent for nearly 10 years, with two years left on his
contract. Couldn’t the School Committee just wait two years, and save
all that cash?
Very good questions, said Azer, who voted against the buyout along with
one other member. They lost.
“A total waste of money,” Azer said, which created massive credibility
issues for town officials trying, and failing, repeatedly, to persuade
town voters to override Proposition 2½.
And massive credibility issues are what we have big-time all over the
commonwealth. Who can believe this pay-your-fair-share-for-the-children
stuff anymore? Taxes keep going up. The children -- and many low-level
state worker drones -- keep getting the shaft. But connected, fat-cat
pensioners keep retiring to condos in Florida. And lots of them aren’t
even 60.
Here’s what else desperate Randolph has lost: 70 teachers, one
elementary school, a remedial-reading program and most foreign
languages. Only Spanish remains, and only at the high school.
You know, if you checked out Beacon Hill’s public hearings schedule for
yesterday, here’s some of what you saw: Senate Bill 1273 establishes a
vision care registry and House Bill 1082 on the efficiencies at banks.
Meanwhile, state Rep. Harold Naughton of Clinton wants to fine and/or
jail road-ragers who honk their horns too much or make obscene gestures
out the window. Clearly, our Legislature is obsessed with regulating
cell phone abuse.
Here’s my obsession: that they not spend five minutes on any other bill
-- not honking horns or hand-held cell phones -- until somebody actually
does something (talking is not good enough anymore) about these endless,
every day, complete and utter rip-offs.
By the way, did you hear the one about the Gloucester lawyer who hired a
detail cop for $40 an hour, but didn’t realize union rules there say a
cop must be paid for eight hours, even if he only works for one? Well,
attorney J. Michael Faherty would cough up only $160 for a two-hour
detail, reports The Salem News. The police filed criminal charges
against Faherty, who’ll probably lose.
The Salem News
Thursday, September 27, 2007
A Salem News editorial
Taxpayers still an easy mark on Beacon Hill
Just how dumb do those on Beacon Hill think we are?
Well, voters must be pretty stupid in politicians' estimation, judging
from the statements they make and the votes they take.
These days all the talk at the Statehouse is about the pressing need for
the millions of dollars that might be generated from casino gambling.
"It's either that or raise taxes," the governor and lawmakers tell us.
But there's a third option that they're loath to talk about -- cut
government spending, particularly in the area of public employee health
care and pensions. It won't close the gap between government's needs and
revenues entirely, but it would be a good start.
Yet at this point, it's still the people who work for the government,
not the people who pay the bills, who have the most clout. And they're
not interested in saving taxpayers any money.
Witness last week's actions in the Legislature:
* By a vote of 133-18, the House of Representatives approved a bill
allowing public employees to form a union without even a formal vote, as
long as at least 50 percent of those in the bargaining unit sign cards
in favor of the organizing effort. Some workers could find themselves
having to pay union dues without even knowing there was an organizing
effort underway.
Unions are in the business of gaining more money and better benefits for
their members. We didn't know there were any groups of public employees
still without union representation; but if there are, this bill is
likely to cost taxpayers something over the long haul.
Yet the only North-of-Boston legislators to oppose the bill were
Republicans Brad Jones of North Reading and Brad Hill of Ipswich. The
Senate passed it on a voice vote, there apparently being insufficient
votes even to force a roll call in the upper chamber.
* Those more interested in pandering to state workers than getting
taxpayers maximum value for the money they spend also found themselves
on the short end of a Senate vote that would have reversed Gov. Deval
Patrick's order allowing state workers up to 12 paid days off per year
for a host of "volunteer" activities. (The policy inaugurated by Gov.
William Weld had offered similar time off, but only for those willing to
mentor students in the public schools.)
True sacrifice would require that they perform those charitable
obligations on one of their 13 paid holidays or during vacation time.
But that's not the way things work in the commonwealth.
Taxpayers should just be grateful that under the new rules,
participation in recreational or athletic activities or working for a
political campaign can't be counted as volunteer work, or there might
have been a sudden surge in the number of charity softball games being
played throughout the Bay State.
The sad fact is that, as has been noted here before, legislators are
more frightened of the unions than they are of the average taxpayer.
Until that changes, voters will apparently have to choose between paying
more taxes and tolls or bellying up to the blackjack table.
The Boston Globe
Friday, September 28, 2007
Patrick signs bill to ease union organizing
By April Simpson
Union organizing just got easier for government employees in
Massachusetts. Governor Deval Patrick signed a bill yesterday that
allows employees to organize through "card check" drives, rather than
secret ballots.
Union officials applauded the measure, which had been vetoed by Governor
Mitt Romney last year and denounced by some business leaders, who said
workers would be intimidated into voting in favor of unionizing. Similar
legislation in Congress is backed by Senator Edward M. Kennedy and
others, but has failed to gain Senate approval.
"This bill is about leveling the playing field between labor and
management," Patrick said in a statement.
Unlike the Kennedy legislation in Congress, which would affect
private-sector workers as well, the state's legislation only applies to
public sector, quasi-public agencies, and a handful of private sector
employees not subject to the National Labor Relations Act.
As the House and Senate debated the bill earlier this year, several
Massachusetts hospitals expressed opposition. As a result, the
governor's version included an amendment that excluded nonprofits, such
as hospitals.
The Swampscott Reporter
Friday, September 28, 2007
State GIC health plan is ‘unattainable,’
frustrated administrator writes
By George Derringer
There will be no health insurance savings next year for the town of
Swampscott or its employees.
Negotiations between the town, trying to implement the Board of
Selectmen’s decision to advocate that town employees switch from their
present 400-member pool to the 286,000-member pool of state employees
for health insurance, have reached “impasse,” Town Administrator Andrew
Maylor told town employees and elected officials in an e-mail sent at
11:15 a.m. Friday, Sept. 28.
Maylor said meeting the Oct. 1 deadline, as set by the Legislature
earlier this summer when it approved opening the state health insurance
system to the employees of the 351 municipalities in Massachusetts, is
“not attainable.”
In his letter, Maylor says the town did offer to increase the percentage
of health insurance premiums paid by the town “in order to get this done
by the deadline.” He did not give a percentage, but town employees now
pay 40 percent of their health insurance premiums and the town pays 60
percent.
Maylor also notes a new movement in Massachusetts to deal with rising
tax bills: A ballot referendum to limit increases in tax collections to
1 percent per year instead of the current limit of 2.5 percent under
Proposition 2½ limits adopted in 1980.
Clearly frustrated, Maylor ends his letter with a question: “Why weren’t
comparable benefits, at reduced costs and the chance to save jobs
enough?”
The text of Maylor’s letter
Here is the full text of Maylor’s e-mail to town employees and elected
officials:
“All,
“During the past week negotiations with the unions and retirees
regarding joining the state’s health insurance system (GIC) reached
impasse. In case you do not know. the deadline is October 1, 2007, to
enter the GIC by July 1, 2008. Now that reaching the deadline is not
attainable I thought it would be helpful for me to share with you my
thoughts and reflections regarding this topic.
“The governor signed the law allowing us to participate in the GIC
during the last week in July 2007; prior to that date this option was
not available us. The concept was that since the GIC has lower premiums
than many (most) communities in the commonwealth, joining the GIC would
allow cities and town’s to lower their staggering health insurance
costs, while providing lower premiums to most employees, a truly great
concept.
“According to information provided by the employee unions, 95 percent of
all people enrolled in the town’s health insurance plans would save
under the state’s program. If that figure is correct, approximately 374
of the 394 families and individuals enrolled in the town’s health
insurance plans would save by making the change.
“In Swampscott the vast majority of those employees with family health
coverage would have saved between $1,300 and $1,800 per year; the
savings for the vast majority of employees with individual coverage
would have been between $250 and $500 annually. This is net of any
out-of-pocket costs that the employee may have to pay under the new
plans.
“I have HMO Blue family through the town and my annual cost is currently
$7,531; my new premium would have been either $5,541 or $5,410,
depending on which plan I chose, and based on my past usage my estimated
savings for fiscal 2009 would have been $1,800. That’s a 24 percent
reduction in health care costs. For individuals, the percentage savings
would have been between 9 percent and 17 percent.
“For what it’s worth, during the past two months nearly two dozen
employees have requested that Denise Dembkoski or I calculate estimated
savings for them. In each and every case, the employee saved money by
migrating to the GIC. So even though I am willing to buy in to the 95
percent estimate of employees that would have saved if we had switched,
it is possible that every employee would have seen savings.
“If all of this information is true (which it is), then why wasn’t this
a slam dunk? Well, for four reasons.
“The first is that it required change and change is difficult.
“Second, the GIC plans do not include Blue Cross-Blue Shield products
like we currently have and some wondered whether the plans offered by
the GIC were as good as Blue Cross plans.
“The third reason was differences in plan design.
“The fourth and final reason was a feeling that the Town should share a
portion of its savings with the employees that get health insurance from
the town.
“It is nearly impossible to address the first reason because change can
be difficult. However, sometimes it is the difficult decisions that
return the biggest benefit. I personally believe that this was a case
and point.
“I provide the following information to address the second point:
Did you know that the City of Boston (36,000 employee and retirees) does
not offer Blue Cross products, but offers these other plans, and the GIC
(286,000 employees and retirees) does not offer Blue Cross, but offers
these other plans? Try to find someone who is covered by these two
agencies who doesn’t like their health insurance. By the way if you want
to ask someone covered by the GIC what they think, they are not
difficult to find. There are employees in almost every town department
who are covered by the GIC now. If that does not work, my guess is that
if you walk into Dunkin’ Donuts on any given day someone in line with
you is covered by the GIC.
By the way, at least 95 PERCENT of all doctors which accept Blue Cross
accept these other plans as well.
“The third reason is ‘Plan Design.’ Plan Design is a fancy term that
means what your coverage is and what you pay for it. The primary
difference is that the GIC plans require that you pay deductibles that
our current plans do not. Before the cynics out there say ‘That’s why
they are less expensive and the town is just shifting the burden to the
employee.’ let me refer you back to the paragraph regarding employee
savings. All of the annual estimated savings assumes the deductibles. No
smoke and mirrors, real savings.
“Well, in the end, as it always does, it came down to money. The
estimated fiscal 2009 savings to the town (not employees) if we had been
able to participate in the GIC would have been approximately $800,000
(this is not the most conservative number but instead a somewhat
aggressive but fair one) at the current contribution rates of 60 percent
town and 40 percent employee. I have heard much higher figures floated
out there; they are simply inaccurate.
“The question is, ‘Should the town give back a portion of its savings to
the employees covered by the town’s health insurance by increasing the
percentage the town pays toward health insurance?’ It is the opinion of
the unions and retirees that it should. It is my personal opinion that
it should not. I feel this way not because I don’t believe that
employees deserve it or that an increased percentage by the town would
help employees financially, it obviously would. My opinion is based on a
very simple premise: ALL EMPLOYEES benefit in any money saved by
switching to the GIC.
“If at the 60/40 split the town saves $800,000, where do you think that
money will go? Seventy-five percent of all budgetary spending goes to
the employees: salaries, retirement, health insurance, workers
compensation, uniform allowances, etc …
“The balance of the money is used to pay and operate and maintain the
buildings we work in. So aren’t all employees benefiting from the
savings? The employees with health insurance receive a double benefit,
their own reduction in premium and the overall benefit that all town
employees would receive.
“For every 5 percent increase in the town’s health insurance
contribution (60 percent now), the savings to the town decreases by
approximately $200,000. That $200,000 is shifted from being used for
employee benefits and operations town-wide, to those (like me) that have
health insurance with the town.
“I don’t consider myself a philanthropist, but I would have been
personally satisfied to see my health insurance decrease significantly
at the same contribution percent knowing that I am also making it more
likely that less people would be losing their jobs due to budget cuts
next year.
“With that being said, the town did offer to change the contribution
rates in order to get this done by the deadline.
“Last year there were 39 positions eliminated in the School Department,
1.5 at the Police Department, one in Fire, one in management, one in
clerical, one in the Department of Public Works DPW and a 15 percent
reduction in hours at the library.
“The School Department has already projected a deficit for fiscal 2009
of between $880,000 and $1.4 million. This is what I mean by saying all
town employees will benefit. Do you think that there will be more or
fewer employees laid off now that we won’t be joining the GIC? Do you
care?
“I know that as public employees you often feel under attack. As a
public employee myself I understand that. As a person that interacts
with the Swampscott taxpayer, I can tell you that they feel the same
way. Yesterday an initiative petition drive was started at the state
level to replace Proposition 2½ with Proposition 1 Percent and to
eliminate the motor vehicle excise tax.
“The effect to Swampscott’s budget would be catastrophic ($2.3 million
less in revenue). I don’t know what will happen with those petitions,
what I do know is that it is an indication that local taxpayers are fed
up with their ever-increasing tax burden and are less likely to vote for
overrides in the future.
“On several occasions during my 14 years in municipal government I have
been told that the fundamental flaw with local governments is that they
have no soul. What do you think?
“Why weren’t comparable benefits, at reduced costs and the chance to
save jobs enough?”
“Notes (also by Maylor): If anyone has any questions about the
information contained in this email I would be more than happy to meet
with you personally. Although I did not speak specifically to the
retiree plans, retirees would have saved money and had comparable
benefits.”
The Salem News
Friday, September 28, 2007
Teachers seek pension credit
for private school years
By Edward Mason
BOSTON - Massachusetts public school teachers who've taught in private
or parochial schools want Beacon Hill lawmakers to change the state's
retirement law to allow their time teaching at private schools to count
toward their state pensions.
Under several plans before lawmakers, public school teachers would be
able to get up to three years they spent teaching in private schools
counted toward their state-funded retirement.
The teachers would "buy back" the time by paying what they would have
contributed had they been public school teachers all along, plus
interest. Still, the state's share is estimated at about $75 million.
The Massachusetts Teachers Association and several area lawmakers said
the change would remove an unfair distinction between public and private
school teachers.
"A classroom is a classroom and teaching is teaching whether in a
parochial, private or public school," said Sen. Susan Tucker, D-Andover,
who favors the change.
For the half-dozen area teachers who attended a Statehouse hearing on
the matter yesterday, their main argument was that the current system
isn't fair.
Lois Jacobs, a teacher at Tenney Grammar School in Methuen, taught at a
parochial school in Boston in the 1970s, and said there shouldn't be a
distinction.
"I taught children of the commonwealth," Jacobs said. "And I'm still
teaching children of the commonwealth."
Also, Jacobs said, the bills would end an arbitrary cutoff -- private
school teachers already can buy back time before 1973. And the state
already allows public school teachers from other states to take jobs
here and buy up to 10 years of retirement time.
Tucker and others also said the change would make state jobs attractive
to the "best and brightest" private school teachers. However, many of
the teachers affected are those nearing retirement.
Before becoming an Andover High School teacher, Anna Sullivan taught at
Presentation of Mary Academy in Methuen. Sullivan said she, like other
teachers at the Statehouse hearing, took private school jobs because
public schools weren't hiring, either because of the recession or
funding cuts triggered by Proposition 2½.
Even though she taught local children, those years she spent at the
parochial school won't count toward her state pension.
"Those working years have disappeared," Sullivan said.
Teachers want the change at a time when the state is spending more than
$1 billion a year to close a $13.3 billion pension shortfall. The gap
between what the state owes retirees and what it has socked away was the
combination of bad planning, loopholes exploited by retirees, and the
Legislature's decision to extend benefits to certain groups.
Indeed, the teacher bills were just a few of the 75 bills that would
broaden pension benefits the Public Service Committee heard testimony on
yesterday.
The Senate Ways and Means Committee put the cost to the state of this
buyback at $75 million. Kenneth Ardon, a Salem State pension expert,
said the plan may not be the best use of state money.
"I'd prefer to see people paid at a higher salary upfront than a bonus
at the back end," Ardon said.
The Boston Herald
Tuesday, October 2, 2007
A Boston Herald editorial
Speaking the truth on health costs
House Speaker Sal DiMasi is talking tough about the new law aimed at
saving cities and towns millions of dollars in health care costs and
giving property tax relief to homeowners -- you know, the law that is
miles away from reaching its goal?
In a speech to business leaders on Friday, DiMasi raised the point we’ve
been making for months -- that giving cities and towns the option of
enrolling their workers in the Group Insurance Commission -- and giving
local union leaders what amounts to veto power over such a change -- may
not achieve the desired results.
The original deadline for communities to decide whether they would
enroll their workers in the GIC was yesterday. By close of business,
only three towns and four regional school districts had notified the GIC
of their approval. Legislative leaders plan to extend that deadline by a
month.
“Let me say here, if I see in the first year that the labor unions don’t
agree and are continuing to block this reform, then we are going to take
them out of the equation,” DiMasi said in remarks to Associated
Industries of Massachusetts on Friday.
Good for him. Organized labor, perceiving a threat to members’ health
care options, is bringing serious pressure to bear. Still, there are
some on Beacon Hill who understand that uncontrolled growth in health
care costs is crippling cash-strapped cities and towns, and certainly
won’t allow them to offer homeowners anything resembling property tax
relief.
DiMasi isn’t a newcomer to this view, nor is he the only top
policy-maker to share it. Senate President Therese Murray has recently
expressed a willingness to revisit the “optional” provision of the law,
too.
But the need for reform is made more urgent by the sluggish response
from cities and towns, many of whose leaders are interested in the
option -- but who face long odds in getting the 70 percent buy-in from
local unions required to go along.
DiMasi should rethink his willingness to give the new law an entire year
to bear fruit. A report released in August suggested communities could
realize $102 million in immediate savings by enrolling their workers,
and $2.5 billion over the next 10 years if all municipal employees were
enrolled.
We won’t get there -- and the taxpayers have zero chance of realizing
the tax relief they’ve been promised -- as long as enrollment is merely
an option.
The Boston Globe
Wednesday, October 2, 2007
Bonus plan approved for pension fund employees
By Andrea Estes
The executive director of the state's $50 billion public pension fund
could add $129,000 to his $322,000 annual salary under a bonus plan
approved yesterday by the fund's trustees that will also pay bonuses to
the agency's 23 other employees.
Michael Travaglini, who received a 14 percent raise a year ago and is
one of the state's highest-paid employees, will qualify for a 40 percent
bonus over two years if the fund meets certain investment benchmarks.
His two top managers are eligible for the same compensation.
The plan is even more generous to other workers, who could qualify for
annual bonuses equal to 30 percent of their pay.
The Pension Reserves Investment Management Board voted 5 to 3 to approve
the plan, a compromise offered after an earlier version that could have
doubled Travaglini's pay was opposed by Governor Deval Patrick and then
abandoned by state Treasurer Timothy P. Cahill, chairman of the board.
"There was a proposal put forward that the governor and I felt was out
of line with comparable pension systems," said Leslie Kirwan, secretary
of administration and finance and Patrick's representative to the
pension board. "Had that come to a vote, I was asked to oppose it.
"In light of significant revisions that were made to the proposal, we
were able to support this program as being more in line with comparable
systems," Kirwan said.
But some lawmakers said the plan -- which could cost as much as $950,000
a year, based on current salaries -- is too expensive, especially given
the state's shaky finances.
"I don't think you'll find anybody in another state agency who has this
type of arrangement," said state Senator Richard R. Tisei of Wakefield,
the Republican minority leader. "Even in the private sector, people
aren't receiving bonuses anywhere near that amount. They seem a bit
exorbitant. One of the pitfalls of having an independent agency is that
it marches to its own drummer."
The board approved the plan without public input.
"I find it interesting how quickly a plan that raises salary
expenditures can come to pass, yet how long it takes to reform other
abuses of the pension system," said state Representative Bradley Jones
of North Reading, the House minority leader. "This plan was devised,
brought forward, and implemented essentially overnight. Maybe there's a
rational basis for doing it. But there are other problems with the
system we see on almost a daily basis, and we can't get them addressed.
That's what frustrates the public."
Under the plan, which would begin making payments next September,
employees would receive bonuses if the fund exceeds a composite industry
benchmark by three-quarters of 1 percent. For the past three years, the
state pension fund earned 16.25 percent a year, 1.03 percentage points
higher than the benchmark during the period.
Although the fund has consistently beaten industry standards by wide
margins, Travaglini said, there is no guarantee the plan will continue
to do so.
"Over five or 10 years, we are number one versus all public peers," he
said in an interview, but added that for July and August this year, the
fund is lagging behind the industry benchmark. "I'll simply say it's by
no means a low performance threshold.
"We're raising the bar, and we're raising the opportunities to earn,"
Travaglini said. "That is standard in the asset management business."
Cahill also defended the bonus plan, although he acknowledged that it
will probably be controversial.
"I'm aware of the level of the salaries and how that plays in the
public's mind," he said. "But I have a $50 billion fund to run, and I
need qualified people to manage it. When those people leave, I need to
be able to attract qualified people to manage it. This is a tool that
allows us to do that.
"I kept hearing from board members and the public that if he [Travaglini]
or the staff were going to be highly paid, it should be more of a
performance-based payment; that's what this is," he said.
Alex Aikens, a board member and a Brandeis University business
professor, said he voted against the plan because he thinks it doesn't
pay enough.
A consultant hired to look at the pay practices concluded that the
pension board pays less than many other successful public pension
systems, he said.
"Our bonus plan should reflect bonus plans of the top public pension
funds," Aikens said. "That's what we aspire to be. I have never seen a
top-performing firm pay like a mediocre firm." The board "has to think
like a private sector firm and not go for the mediocre."
The Salem News
Wednesday, October 3, 2007
Firefighter sick days peaking, chief warns
By Alan Burke
PEABODY - City firefighters' sick days could hit a new high this year,
fire Chief Steve Pasdon warned the department in a memo late last week.
Firefighters have called in sick 1,280 days so far this year, according
to the chief, who projected the number will rise to 1,706 by the end of
the year, up from 1,418 last year and 838 the year before. Last year,
the number of days firefighters called in sick -- an average of nearly
16 per person -- required the City Council this spring to appropriate an
additional $100,000 in overtime for coverage of those shifts.
Sick time, Pasdon said previously, is the reason why Engine 1 is
frequently taken out of service.
His memo was sent on Sept. 28 in response to a gleaming new,
professionally made sign in front of the main fire station on Lowell
Street, advising "www.Local925.org/Engine 1 Closed Due to Budget Cuts."
The engine is taken out of service whenever staffing levels fall below a
certain point. The new sign replaced an older one that the union had
used for several years to inform the public of the closings. A similar
sign is at the Engine 3 station on Prospect Street, according to the
memo.
Yesterday, Engine 1 was in service and the new sign was left inside.
In view of the sign, Pasdon wrote his firefighters, "I feel it is in
your best interest that I release (to you) a report of sick time used by
you ... before it becomes public and I get blamed ... as I did last time
when this topic was pushed to the forefront of public attention."
"Please accept this memorandum as nothing more than information for you
to digest," he said.
Pasdon expressed frustration yesterday that the memo had reached the
press. "It was an internal memo and not meant to be disseminated to the
press." He warned that the data is subject to change.
"The data is just too raw," he said, explaining that he sent the memo as
"a gentle reminder" to his firefighters. Further, he noted efforts to
bolster the size of the department, which is meant to have 103 people.
"We just put four guys on," he said. Two more are due, which will leave
the department at 100.
The memo hints at a growing chasm between the city and the firefighters
union.
"The differences between the chief and the union are the worst they've
been since I've been here," union vice president Steve Rizzotti said.
"And I've been here 20 years."
"We have a number of guys out this year," said Rizzotti, who called the
memo "kind of childish." He characterized the absences as legitimate and
said the department averaged 5.7 sick days per man through September.
"They're very unhappy with the signs. But we're unhappy with Engine 1
being closed."
Rizzotti stressed that the union's unhappiness settles more on the chief
than Mayor Michael Bonfanti, although he did say, "I never thought I'd
want Mayor (Peter) Torigian to come back." He expressed dissatisfaction
that the latest contract -- agreed to in arbitration last winter --
still hasn't been signed.
However, the firefighters' raise has gone through.
No sooner was that contract settled than it expired last June, Rizzotti
said. He lamented that little has been done to tackle a new contract.
Bonfanti placed the blame for any delay on the fact that both the city
and the union have hired new lawyers "who are talking. Isn't that the
place to negotiate?"
The mayor expressed regret over the hard feelings between the chief and
the union.
"Mr. Rizzotti is trying to stir things up," he said. "Mr. Rizzotti is
talking to the press. Before talking about how things are so bad you
look in the mirror and say -- 'Am I part of the cause here?'"
In answer to a question, Bonfanti said that he had looked in the mirror
and asked himself the same thing. "I certainly want to work with the
Fire Department."
Dismissing the Engine 1 sign, Bonfanti mused, "They had an old sign.
They got a better sign. ... I, like most people, ignore it."
All agree that sick days are difficult to compare with those in
traditional occupations or even with other departments. Firefighters in
Peabody work 24-hour shifts followed by three days off.
Sick days in Peabody Fire Department:
2004 - 1,070
2005 - 838
2006 - 1,418
2007 to date (through 9/28) - 1,280
2007 projected - 1,706
Source: Fire Chief Steve Pasdon
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