NIAGARA FALLS – City lawmakers will continue to receive what has been called a generous payment for turning down the city’s health insurance plan.
Lawmakers voted down a measure last week that would have eliminated the opt-out payment for council members.
The vote comes nearly a year after The Buffalo News reported that the city pays $9,083 – more than nearly every other area municipality – to workers who do not take the city’s health insurance plan. The payment was defended by some who say it saves the city money on health insurance coverage but criticized by residents who saw it as overly generous.
Only Councilwoman Kristen M. Grandinetti, who drafted the legislation, voted in favor of the attempt to get rid of the opt-out payment for members of the council.
“We are in a dire situation right now,” Grandinetti said. “I simply wanted to take part in the process with getting the budget to where we can work with it and to where the citizens of the city don’t have to pay for it.”
The four councilmen who voted to keep the opt-out had different reasons for their vote.
Councilmen Robert Anderson Jr. and Charles Walker are covered on the city’s health insurance plan, so they are not eligible for the opt-out.
But Anderson said the opt-out is a nice perk for a job that requires many hours of work for a salary that in 2012 paid an average of $12,000. Anderson said the council members make “chump change” compared with lawmakers in other counties, adding that they work hard to address a number of issues brought to their attention by residents.
“Seven days a week my phone rings, and I respond,” Anderson said.
Walker, meanwhile, actually opted out of the city’s health plan in recent years but declined to collect the payment.
His said the opt-out payments were not offered when he was elected to the council, so he felt it was not right to take the money. But now Walker believes council members should remain eligible to receive the opt-out money.
“I feel now that it’s on the books … When people are elected [they should receive it],” he said.
The opt-out money also helps attract highly qualified candidates to the position, Walker said – especially those who might otherwise find the compensation less than they expect to receive.
Walker said the same logic was given when the mayor’s salary was raised from $30,000 to nearly $78,000 five years ago.
“It helps incentivize it, and that’s the whole point of it all,” Walker said.
Council Chairman Sam Fruscione also opposed Grandinetti’s attempt to nix the opt-out payment.
Fruscione receives more than $9,000 for opting out of the city’s health insurance plan. Like Grandinetti, he is a public school teacher and receives health insurance from the school district.
When the opt-out payments were first called into question, Fruscione said he would be in favor of discontinuing the opt-out if Mayor Paul A. Dyster negotiated a change in the union contract, which his administration approved.
The council chairman also accused Grandinetti of playing politics by proposing the change.
Fruscione said Grandinetti was trying to “redeem herself” for accepting an opt-out payment of nearly $9,200 earlier this year when, as a single woman, she was only entitled to receive about $3,500. The Niagara County District Attorney’s Office investigated the matter, which was deemed a clerical error, and Grandinetti said she has been paying the city back.
“It was solid politics. She was just targeting us,” Fruscione said, referring to the council majority that is often critical of her and Dyster.
Grandinetti dismissed that notion, saying that she had “no malicious intent” and stressing that her proposal would have only applied to elected officials, not union workers.
“I don’t operate that way,” she said. “Anyone who knows me knows I don’t operate that way.”
Fruscione said any change in the health insurance opt-out policy should come through the city’s health care committee.
Councilman Glenn A. Choolokian, who also receives more than $9,000 in yearly opt-out payments, declined to comment about the issue.
As it stands, the opt-out costs the city more than $400,000 per year, and under a 2006 labor agreement, workers get a $350 check every two weeks for turning down the health insurance. For a family plan, that’s more than $9,000 per year, compared with $3,000 for a single plan.
Buffalo and Erie County workers, meanwhile, get an average of $1,200 for turning down the health plan, while Niagara County workers get $1,000.
While some have defended the opt-out as a way to encourage city workers to find health insurance elsewhere, some residents’ frustrations were compounded by the fact that many workers receive health insurance through spouses who work for the school district or county, and then take the city opt-out as well.
Grandinetti said she is paying back the additional opt-out money she received. And with the city’s financial crisis worsening, she said she would not collect the opt-out money in the future.