Majority Commissioners Balancing Budget on Backs of Productive and Prudent Taxpayers, earners, savers, investors in job creating businesses which meet a payroll. This letter from The Forgotten Taxpayer’s BFF Commissioner Jenny Brown and letter to the editor brings to our attention the common sense ideas of Lower Merion Citizens for Responsible Budget.
In the letter, CRB analyzes the Township’s spending problem and offers reasonable goals for the collective bargaining agreement that the Township is currently negotiating. CRB is correct in its assertion that benefits for Township workers currently are, and have been, far more generous than benefits that taxpayers receive in the private sector.
Private businesses, which don’t have taxing authority, could never survive with these types of benefits and aligning Township benefits with the private sector is one of the best opportunities to solve the Township’s spending problem.
To be certain, the Township should not try to balance its budget solely on the backs of its employees. But equally certain is that the Township should not continue to offer unreasonable and excessive levels of benefits and that aligning such benefits with the private sector is an important part of a balanced budget solution.
Currently, Township employees pay between 4% and 5.25% of their health insurance premiums.
A widely cited 2010 Study done by the Kaiser Family Foundation with the Health Research and Education Trust found that in 2010, workers who had health insurance through their employers contributed on average 19% of the total premium for single coverage (up from 17% in 2009) and 30% for family coverage (up from 27% in 2009).
It would be reasonable to require Township employees to contribute 19% for single coverage and 30% for family coverage. This would reduce the Township’s expenses significantly and address the spending problem that has resulted in a 60% increase in property taxes since 2002.
Moreover, the insurance plans that the Township offers also are far more costly than most offered in the private sector. Per the Kaiser Study, the average premium for employer sponsored health insurance in 2010 was $5,049 for single coverage and $13,770 for family coverage. I am waiting to receive information about the average premiums paid by the Township. However, we do know that in 2010, the Township offered family coverage that cost the Township $24,600 per employee (78% higher than the average!).
It would be reasonable to offer coverage that is less expensive than the coverage options currently offered by the Township (such as $2 and $5 co-pays).
In its letter, CRB offers a number of other reasonable suggestions to bring the Township’s labor costs to a more reasonable number, and “hopes” that the Township will negotiate a reasonable agreement.
Unfortunately, CRB is going to be disappointed. While the terms of the tentative agreement are not yet public, and I will respect the Township Manager’s request not to make those terms public until the Workers Association ratifies the agreement, I can tell you that the proposed agreement does not seize the best opportunity the Township has had to control spending in a way that is reasonable and fair to both Township workers and Township taxpayers.
Once the WA ratifies the agreement and before the Board votes on the Agreement (on August 3), I will advise you of the details of the proposed agreement. I think you will find the terms eye-opening. And remember, last week, the Board majority rejected a proposal to compare Township compensation to comparable surrounding municipalities and to the private sector. I strongly suspect that the same Commissioners who didn’t want to know how Township compensation compares to the private sector will be the same Commissioners who vote to approve a contract that fails to align benefits with the private sector.
So, stay tuned!
Lower Merion Township Commissioner
Ward 2 – Gladwyne/Penn Valley