{"id":12853,"date":"2012-12-12T20:08:21","date_gmt":"2012-12-13T01:08:21","guid":{"rendered":"http:\/\/stateimpact.npr.org\/new-hampshire\/?p=12853"},"modified":"2013-01-18T11:10:39","modified_gmt":"2013-01-18T16:10:39","slug":"coalition-of-towns-challenges-lgc-refund-plans","status":"publish","type":"post","link":"https:\/\/stateimpact.npr.org\/new-hampshire\/2012\/12\/12\/coalition-of-towns-challenges-lgc-refund-plans\/","title":{"rendered":"Coalition Of Towns Challenges LGC Refund Plans"},"content":{"rendered":"
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Amanda Loder \/ StateImpact New Hampshire<\/p>

While the LGC remains the go-to place for municipal services, it's facing continued opposition over its handling of insurance surplus payments<\/p><\/div>\n

It’s been a busy week on the Local Government Center<\/a> beat.<\/p>\n

Recently, we reported for NHPR<\/a> that a coalition of 12 towns has banded together to demand what it calls its “fair share” of health insurance surplus payments from the Local Government Center.\u00a0 In the interests of bringing you up to speed, we’ll outline the gist of what happened with this ongoing saga.<\/p>\n

This Week, On The LGC Beat…<\/h3>\n

The sticking point is that the LGC recently announced it plans to pay back more than $52 million to communities that paid into their health insurance and property-liability risk pools by offering a premium holiday.\u00a0 That’s basically the equivalent of store credit for buying more insurance.<\/p>\n

But many of these coalition municipalities have withdrawn completely from the LGC.\u00a0 So they can’t benefit from the holiday.<\/p>\n

On Monday, this group of disgruntled towns got a lawyer and sent a letter to the Bureau of Securities Regulation<\/a> asking the state to investigate the LGC’s surplus return policy on the grounds that it was “discriminatory.”<\/p>\n

The next day, Salem joined this group, making it a Gang of 13.\u00a0 (We documented<\/a> that town’s disappointment with the LGC last week.)<\/p>\n

The Letter: Highlights<\/h3>\n

In his letter to the Bureau of Securities Regulation, coalition attorney John Ratigan from the firm Donahue, Tucker & Ciandella<\/a> laid out the crux of their complaint:<\/p>\n

“The present position of the LGC that it is only obligated to return Surplus to those municipalities who are presently within the applicable trust program unlawfully discriminates against former municipal members whose contributions help create the surplus.\u00a0 The proposed distribution of surplus may also create a windfall to the LGC.<\/p>\n

Such funds would have been returned to the Towns of Peterborough, Durham and the other Towns mentioned above, but for the LGC failing to perform annually its audit, actuarial and fiduciary responsibilities in accordance with law.\u00a0 We believe LGC’s refusal to return to Peterborough, Durham and the other Towns that join in this letter their prorata share of the Surplus is improper and contrary to law.”<\/p><\/blockquote>\n

Ringleaders: Peterborough And Durham<\/h3>\n

Durham and Peterborough are heading up the effort to get what they call their “fair share” of the surplus.<\/p>\n

<\/p>\n
The Coalition<\/h5>\n

Auburn<\/p>\n

Bennington<\/p>\n

Canaan<\/p>\n

Durham<\/p>\n

Greenfield<\/p>\n

Henniker<\/p>\n

Lyndeborough<\/p>\n

Northfield<\/p>\n

Peterborough<\/p>\n

Plainfield<\/p>\n

Raymond<\/p>\n

Temple<\/p>\n

Salem (later addition)<\/p>\n

<\/div>\n

“I don’t know if it’s a dollar, and I don’t know if it’s a hundred thousand dollars,” says Peterborough Town Administrator Pamela Brenner.\u00a0 “But regardless of if it’s a dollar or a hundred thousand dollars, it’s owed to the residents of Peterborough.\u00a0 And for that matter, with the health insurance, to the employees, who paid 20 percent of the premium.”<\/p>\n

Peterborough left the LGC’s health insurance program, HealthTrust<\/a>, in July of 2012.\u00a0 It’s also not part of the LGC’s Property-Liability Trust<\/a>, the other program ordered to return millions of dollars to communities.\u00a0 “But due to the way they’re going about refunding it, which is a premium holiday, we receive no benefit to it,” Brenner says.<\/p>\n

The situation is a little bit different for the town of Durham.\u00a0 It’s no longer part of the HealthTrust program.\u00a0 But unlike Peterborough and many of the others in the 13 town coalition, Durham hasn’t completely<\/em> left the LGC’s program.<\/p>\n

The town has five basic public employee units: firefighters, police, middle-managers, public works, and non-unionized.\u00a0 Durham moved two of those groups–police officers and non-unionized workers–to SchoolCare<\/a>‘s competing health insurance program last July.\u00a0 Town Administrator Todd Selig says the remaining three units still have medical coverage through the Local Government Center.\u00a0 So under the LGC’s surplus return policy, he says the town would receive its refund on behalf of three-fifths of the public worker groups covered by the order.<\/p>\n

“But even there, the only way to take advantage of that contribution holiday is to remain with LGC, which makes it problematic for Durham and other communities that are taking advantage of that premium holiday to really go out on the market and shop around and find another plan that perhaps offers equivalent programs but at a better price.\u00a0 Because they’d be leaving money on the table,” Selig says.\u00a0 “That’s problematic, and really creates a hook that makes it almost impossible for anyone who’s presently a member to leave.”<\/p>\n

A Shift From The LGC?<\/h3>\n

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