Gurney's Inn
December 26, 2007

The Bennies Battle: All About The Benjamins

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For months East Hampton Town Supervisor Bill McGintee's political foes have accused him of fiscal mismanagement. His latest cost saving proposal has done little to allay the suspicion that the McGintee administration is out of money and desperate.

On October 1, McGintee submitted a draft budget that included funding for employee medical benefits as anticipated under the program helmed by Island Group Administration. Four days later, he sponsored a resolution switching the insurance carrier to the state Empire Plan. Town board members unwittingly voted yes on the bill.

In recent weeks, once the prospect of a switch to a plan that offers reduced benefits and increased out of pocket costs for workers became public and fomented a furor among the union, board members admitted they didn't realize what they were voting on. They claim the proposed switch was never discussed.

Tempers flared during the board's December 18 work session when Councilman Pete Hammerle wondered why the switch issue was never broached over the course of weeks of budget discussions. He never heard "one word" about a looming change, Hammerle said. "Until three weeks ago, except for the supervisor, no other board member had cutting insurance on their brain."

"Obviously you weren't listening during the budget process," the supervisor countered. "If you missed it, that's not my problem." Traditionally, escalating employee medical benefits and retirement costs comprise the greatest expense in any budget. Most chief fiscal officers mention that burgeoning cost during budget development. McGintee referenced it as well, but he never proposed switching to Empire this year, board members contend. That means if the change occurs, the adopted budget will enjoy a windfall of between $1.5 million and $2 million – extra money no one anticipated, except the supervisor.

Affecting a sense of urgency, McGintee said repeatedly the change would reduce costs for the taxpayers, especially Springs residents who face enormous tax increases due to school district costs. "Four million dollars is nothing to shake a stick at when we have people clamoring for tax relief," he said, later adding that every month that passes before the switch is made costs the town money. "This is a financial decision that has to be made, not quickly, but immediately," McGintee said. What McGintee didn't say was the town's current provider could match and even surpass the savings offered by Empire if the benefit package was reduced.

"It's not the town that's killing Springs," Hammerle replied. Pitting the taxpayers against the workers is not the way to handle this, he continued, his voice rising, "If it's going to be presented as 'if you are opposed to this switch, you are against reducing taxes,' that is a load of crap and I will dig my heels in on this."

Alan Kaplan of Island Group said he had told the town during the summer that he could match and even exceed the Empire savings if benefits were reduced accordingly and the town declined.

Ever since he took office in 2004, when McGintee was confronted with budgetary problems, he pointed the finger at his predecessor Jay Schneiderman and former budget officer Len Bernard. During last week's work session, Kaplan said over his recommendation, the last administration hiked the stop loss deductible from $75,000 per person to $140,000 in order to achieve premium savings. Stop loss insurance covers catastrophic illnesses. Under the plan brokered by Schneiderman, the town pays the benefits up to $140,000. Any costs past that, the insurance company covers. The measure reduced monthly premiums by $17,000 per month, but increased how much the town was on the hook.

"They were under-funding a known amount to produce a deflated budget at the beginning of the year," McGintee said of his predecessors. "We are now fully funding our medical and not pulling smoke and mirrors on the public," the supervisor declared.

Reminding that he served on the town board during the last administration, Hammerle said he was never informed of that change or involved in discussion about it. "It's very disturbing to me that one person on a board can unilaterally make a decision like that and not even tell anybody about it," the councilman said.

Meanwhile, outside Town Hall demonstrating workers had the same complaint, about McGintee. Amidst complaints along the picket line that McGintee's poor fiscal management is causing "trouble" with the budget, and that he is desperate to make up pending shortfalls any way he can, one worker grumbled, "Bill McGintee is using us to pay for his bad habits."

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