Jul. 7--NORTH ADAMS TRANSCRIPT

NORTH ADAMS -- Three city unions are calling for an independent audit of the Medical Insurance Trust Fund, claiming the city has failed to pay its fair share into the account while overcharging retirees and employees since 2005.

The unions say they have filed grievances with the state Division of Labor Relations.

Mayor John Barrett III called the claims, made by the North Adams Teachers Association, North Adams Police Association and North Adams Firefighters Association, "ludicrous and ridiculous" -- citing the fact that the city undergoes an independent audit each fiscal year as required by state law.

According to negotiated contracts, the city -- which provides health insurance for its employees outside of any group plan -- pays 70 percent of the city's health insurance costs into the insurance trust fund. City employees pay the other 30 percent through weekly health insurance premiums.

The unions have charged that the city failed to pay its full share of the premium costs and has overcharged city employees by $600,000 since 2005.

Barrett said that is untrue.

"These people do not understand how the system is set up," he said Monday. "We've been going over this for at least a year, when the group wanted to enter the state Group Insurance Commission [GIC].


"They don't want to understand either -- as part of their contract, the North Adams Teachers Association agreed to meet with a

federal mediator so he could explain how a self-insured plan like ours works.

As far as I know, they went to two meetings and haven't gone since." He added, "Every one of our bills are paid, and when the trust comes up short, it's the city that makes up the difference, not the employees."

The mayor lodged his own allegations, saying that all three unions have hurt their "rank and file members" by wasting thousands of dollars on independent studies instead of settling contract negotiations with the city.

"This is the same teachers' union that three years ago advised its members not to go into negotiations over an extended school day -- which is the only education line item that was fully funded this year," Barrett said. "These are the same police and fire unions that turned down a 3 percent increase on their base rates for last year and this current fiscal year. Instead, they are saying we're absconding with their money."

Susan Chilson, newly elected president of the North Adams Teachers Union, said Monday that the groups have the best interest of their membership at heart and are just trying to ensure that federal labor laws are not being violated.

According to the three unions, the city hasn't been forthcoming in providing requested information and has failed to correctly utilize a legally mandated Insurance Advisory Committee.

"This advisory committee, which is traditionally made up of the mayor, treasurer and representatives from the unions, should meet to talk about the health of the medical insurance trust fund and review the claims costs before any rate increases are discussed and go into effect," Chilson said. "The committee has existed in essence for years, but there is no discussion -- the rate increases are just handed out."

After months of requests for information, she said, the unions have put together several years of insurance trust numbers, which were looked at by an independent consultant.

"Based on the numbers we were able to get, it's apparent that the employees paid more than their fair share," Chilson charged.

She said the unions want transparency from city officials.

"We're asking for an independent audit that looks at the operations of the fund, as opposed to just matching numbers," she said.

City Councilor Richard J. Alcombright, who is challenging Barrett for mayor this year, said he first learned of the unions' concerns several weeks ago when he met with representatives from each group.

"It seems like a continuation from last March, when issues around the GIC were still ongoing," Alcombright said. "The city does undergo a mandated audit, but my question is whether the audit addresses if the trust is fully funded and how funds are allocated. As a councilor, I can say we receive a budget each week and see how the money is spent, but I would also suggest that many of us don't understand how the trust fund works."

He added, "I definitely think this is something the council's finance committee should take a look at. I think the unions have put together a significant package that warrants the finance committee's attention."

In October, when the city's seven unions were collectively trying to force the city to join the GIC by the Dec. 1 enrollment deadline, citing a potential $1.5 million savings for the city, Alcombright was cautious to join their cause.

"I met with the mayor and Nancy Ziter [the city's interim treasurer] about the issue at length," he said. "While I would have to beg the idea that $1.5 million would be saved, I believe there would have been some savings. I think the major problem at the time was the governor was making emergency 9c cuts and took $30 million from the GIC budget. My thought was to wait six to 10 months and see how other communities fared."


Barrett said Alcombright did not bring up the unions' charges about the city under-funding the insurance trust fund during the council's June 25 hearing on the city's fiscal 2010 budget.

"He's a member of the finance committee, so I question why he hasn't raised a single question about this issue in the last year," the mayor said. "If he knew the unions were questioning the trust fund, why didn't he bring this up during the budget hearing?"

An e-mail request to the state Division of Labor Relations seeking comment on the matter was not answered by Monday's press deadline.

To reach Jennifer Huberdeau, e-mail jhuberdeau@thetranscript.com

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