East Hampton Town GOP Says ‘Yes’ To Putting Health Overages Into Dedicated Reserve; Dems Opposed

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The East Hampton Town Board, in a vote split along party lines last week, passed a resolution to put any surplus that results between the approved 2014 budget and the rates issued by the New York State Health Insurance Program into a reserve with the aim of using it to offset future expenses related to employee benefits.

The outgoing Republican majority, Supervisor Bill Wilkinson, Deputy Supervisor Theresa Quigley and Councilman Dominick Stanzione, carried the vote during a work session on Tuesday, December 3, while Democrats Sylvia Overby and Peter Van Scoyoc voted against it.

The board, following a heated discussion over health insurance premiums on November 19, just prior to adopting the 2014 spending plan, had factored in a 5-percent increase into next year’s budget, based on the most recent NYSHIP recommendations.

Each percentage point represents approximately $110,000, officials said.

At the time the Democrats called for a greater increase, with Mr. Van Scoyoc calling for a 10-percent increase that was initially factored into the draft budget. The clash over what percentage to factor into the final budget led to Mr. Van Scoyoc and Ms. Overby voting against the $69.43 million spending plan, which passed with the GOP votes.

The town had to adopt its budget by November 20. However, NYSHIP confirmed a 1.8-percent health premium rate increase on November 29.

Mr. Wilkinson issued a statement two days later touting the town’s zero-based budgeting as saving taxpayers $500,000, roughly the amount saved by budgeting the 5-percent increase that he and Ms. Quigley had called for, as opposed to the 10-percent increase originally drafted.

Beginning on January 1, he noted, the Empire Plan for participating employees’ health care will increase, in aggregate, 1.8 percent. He and Ms. Quigley had pushed during the budget’s adoption process to stick to zero-based budgeting.

But with the actual NYSHIP increase coming in at 1.8 percent, there is a cushion of some $300,000 more than factored into the budget with the 5-percent increase, he noted, adding that he would therefore recommend that the excess go into a dedicated reserve for benefit purposes.

“Once again, from a budgeting point of view, we are glad we reduced the current and future tax liability for our residents,” the supervisor wrote. “Absent of insisting on maintaining the financial disciplines which saved us in the first place, history could very easily repeat itself.”

The supervisor this week explained that the resolution prevents the new administration from taking any surplus from overbudgeted health care and transferring it, through budget modifications, to lines that could pay for unapproved budget expenses.

The Democrats, however, objected, calling for the surplus instead to go toward other areas, such as staffing.

Mr. Van Scoyoc said the town has heard compelling arguments from several departments about staffing. He added that he was glad Mr. Wilkinson took his suggestion of putting excess funds into a reserve, “but he’s doing that ahead of the game. He’s taking the option away from the incoming board.”

Ms. Overby called the resolution an “impossible way to do business,” adding that some people have called for more code enforcement, among other items.

Ms. Quigley objected that no one brought up adding new people when budget discussions started back in August.

Town budget officer Len Bernard, meanwhile, observed that there is no surplus yet. He also noted that expenses could change, for example, if an employee switches from an individual to a family plan or if a spouse on an outside plan loses his or her insurance and then joins the town plan.

“In the end, we certainly don’t know exactly what the difference is between what we budgeted for and what will be spent,” he said.

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