City of Duluth wins latest round in retiree health care case
July 30, 2012 at 7:00 pm in Duluth News Tribune
The city of Duluth notched yet another victory last week in a case involving the health-care benefits of its retired employees.
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I would gladly take what the city employees have today. Back in the 80′s they took a 3 percent hike in pay vs a 5 percent and took the free heath care in exchange. Or something very close to that. Its not like they took a 30 percent reduction in pay. Health care was not the huge dollar item that it is today. I think the average person today has seen cuts due to the economy. What makes the city employees think they are so special that they are exempt from reality?
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Quote from Eli….”Miletich said the valuable retiree benefits influenced past contract negotiations and prompted city workers to accept lower rates of pay than they might otherwise have sought.
“That’s what collective bargaining is about. We gave up something of value to get something else of comparable value,” he said.
So the employees took a 3 percent increace in pay vs 5 or 6 in exchange for free health care. This was back in the 80′s . The health care costs were small compared to what they are now. When Eli says “comparable value” what do you think that means in todays dollars? You have to compare apples to apples. You have 1980′s health care costs vs taking 2 or 3 percent less of a pay bump. You have 2012 health care costs vs what???? What are the city retirees giving up in todays dollars vs the health care they get?? Eli did bring up the issue of “comparable value”. The answer is not much. Sure…they have to pay a little more now than before. But look what they are getting! Duluth is still on the hook for 192 million! And Eli is still not satisfied? The courts see this the same way I do.
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Part of the problem was that the city didn’t have retiree go on medicare so that the first payeer would have been medicare and the city would have been a suplement, second was that the city did not fund the retiree health care fund to the extent they were suposed to, third the city then took out money out of the health care fund instead of rasing taxes or bonding for canal park improvments ( and we all know who that benifits-owners of resturants/motels in that area, any idea who?) I was on the negotianing team for contracts and I will say that the entire contract except one item was dictated by the city, The one item-weather the raise for the second year would be a percentage or a stated amount.
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Funny, when it’s public employees people say they got what they deserve. If you start talking changes to Medicare or Medicaid there’s people marching in the street.
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how about a change to military pension/benifits and I know that this will get thumbed down BUT how many military are in an active war zone
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They’re closer to it than you are.
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I could maybe see your point if we’d been at peace for the past 20 years but comparing a combat soldier to a desk clerk in regards to health care is beyond ridiculous. Less than 1% of our population serve in our military and only a fraction of that earn enough points to qualify for an active duty retirement earning free health care. No one is stopping you from joining our military and risking your life to defend our freedoms and if you’ve ever been to a war zone you’d realize how dumb your comment was.
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Don’t gore my cow………! Hiss hiss..
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City is bonded to 200 million debt now for some good and some not so good projects, lest us talk about this a little..! None of which has anything to do with health care……
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If the change in plans had actually been substantial enough to cause a financial hardship for the retirees, it would be concerning.
That’s obviously not the case though, since they can afford to keep paying the lawyers to continue, even after a Supreme Court ruling.
It’s a little surprising to me that people that spent pretty much their entire working lives with the city would now rather see the city on the verge of bankruptcy, than to accept the change.
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Katydid, make no mistake, this is just the city getting it’s foot in the door. Once they take healthcare off the table for current employees they(city) will leave the retirees out in the cold.
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Unions may have built this country. And now, through their excessive sense of entitlements, they are tearing it down.
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Please exlain how negotiating with someone and both parties agree to the terms is somehow a “entitlement” What’s wrong with expecting a benefit from a written contract?
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Mr. Miletich – I’d like to point out that it was these very same City retirees that left the City of Duluth’s retirement fund $200 Million underfunded. You can’t underpay into the system for 30 years and then still expect to get free medical coverage. In reality, these retirees are trying to get the best of both worlds – underpay severely while they were employees and then reap the benefits as a retiree. It can’t work that way. With the current agreement, the retirees are getting exactly what they paid for. If they want completely free medical, then they needed to pony up A LOT more $ while they were workers.
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The retirees receive a benefit to which they aren’t legally entitled for 23 years per the Supreme Court yet Eli has the audacity to spout this reneging drivel. An individual retiree pays $0 for their premium & has better coverage than 95% of the population. This gravy train & entitlement mentality hopefully will end soon.
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Yes, I would gladly give the City workers and retiree’s my health plan, which I pay $118 a month for, have a $1,500 a year deductible and then an 80/20 policy (20% being my co-insurance I owe, up to an out-of-pocket of $3,000) a year! And you wanna cry about yours Eli? And I make under $10 an hour! What everyone else is saying is so TRUE, you want it all, at our expense, in today’s horrible economy, up to and including bankruptcy for the city, would you even be happy then!? Don’t be a dumb cluck here, think about it logically! 1980 was how many years ago? Medical costs then? Medical costs now? I’m sure you can do the math buddy!
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Why does everyone want a race to the bottom? Will you be happy when only the rich can afford health insurance?
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“A race to the bottom” sounds like a great campaign slogan for Obama!
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I just broke my hearing aid today.. and cannot hear…. I know if one of the city retired folks broke their hearing aid, they could afford to get it fixed….
My hearing aid is an old one…. not one of the new 2,000 plus types and I nurse it along.. Perhaps I am bitter about this but I guess it all boils down to some issues that does not seem fair… The city has had some really good benefits in addition to some pretty good pay. Why should a city worker get more pay, more salary, more holidays, more overtime, more benefits, more of everything while the average worker in Duluth can never hope to match that….
yeah… I think what Don Ness (remember, he is a democrat) did in balancing the city out of debt was fair and honorable and needed to be done…
Bill
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Bill, if I had gone to college I would probably be making more money and have it better than city employees do. Could a woulda should a.
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may i suggest starky hearing aids for you (consistently rated as one of the best companies to work for and ceo is considered one of the best as well…and my brother works there haha) they are the number one hearing aid manufacturer in the world and are based in minnesota (they also provide free hearing aids to the poor across the world)
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First off there is no 200 or 300 million debt in a pot out there. It is adding 30 years of payments together for a grand total. So if taken with today’s figures this is an annual cost of 6.6 million.
May I ask what would the recipients have to say if the Congress came out Monday and said we will now increase you annual medicare copay to 20%…?
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Bob, you are correct. That’s why they (city) calls it a liability. If all people on the plan used every dollar available then the city would have to pay 198 mil. Their talking about a possible event.
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Something like this is supposed to ALWAYS be considered liability…..anytime a company or city or what have you has a contract with employees and has promised to contribute a certain set amount of dollars to a fund which finances employee benefits, medical claims, retirement or whatever….that amount of money is considered a bill…..and bills HAVE to be paid! The city should have been paying into the fund since it was agreed to by all parties involved. I do not know how a city, county, state, the fed gov’t or ANY company in the U.S. can get out of or delay contributions to those accounts…..unless there is a loophole or some other Federal Gov’t mechanism that allows a company or a city to delay paying into the fund! Like I mentioned earlier….this has to be considered a liability ( as in owing a bill to someone )…….the city has to accrue that money and include the amount owed to the fund….and add that amount to their annual budget….so they can pay the liability ( bill ) on a annual basis…..then they would never run into problems like this…..or street maintenance and repair…..and other infrustructure items that we all know happens…..on a continual basis!
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