Those in attendance included Mayor Ryan J. Bingham, City Councilors Paul F. Samele, Jr., Elinor Carbone, Drake Waldron and Rick Dalla Valle, Deputy Fire Chief Gary Brunoli, Purchasing Agent Pennie Zucco, Comptroller Alice Proulx, Police Chief Michael Maniago, Tax Assessor Donna Patchen, and Personnel Director Thomas Gritt. Also present was John Calkins of Bozzuto Associates, Inc. City Councilors Marie Soliani and Thomas Jerram were absent.
Mayor Bingham called the meeting to order at 6:07 p.m.
ASSESSOR #18 Assessor Patchen spoke in answer to Councilor Jerram's suggestion in the March 8th meeting to eliminate or halve the contract services costs, relying on the Assessor and Deputy Assessor to fill in. Mrs. Patchen said there would be a huge effect as she does not have enough staff to be out in the field. She said the contract service line item covers every building permit issued in the city with a review measuring every item that affects value. During an eight month period last year, 700 permits were reviewed, ranging from 15 minutes to an hour each. She said it may be up to 450 hours that the contractor is in the field,
completing work on weekends and nights, allowing access to all new construction. Last year, for the $33,000 spent, the contractor brought in additional revenue of $346,000.
Mayor Bingham asked what would happen if that expense were cut in half. Mrs. Patchen replied a staff member would have to review all the permits, and she herself would have to do that staff member's work.
Councilor Carbone asked how the contract was set up. Mrs. Patchen said we're charged between $25.00 and $35.00 per inspection including all call backs, and Southington, for example, ended up paying $55.00 for each inspection with extra charge for call backs.
Councilor Dalla Valle said overtime for staff members would cost more than $33,000.
HEALTH WELFARE CONSULTANTS #230 On a motion by Councilor Waldron, seconded by Councilor Samele, the Council voted 3/1 to approve the Purchasing Agent's recommendation to hire Lindberg & Ripple, Inc. of Windsor, CT to supply Health and Welfare Benefits Consultation services to the City. Councilor Samele was opposed.
Mayor Bingham said he has been updating consultants across the board, sending out RFQ's to make sure we're getting the best services and trying to drive down costs. He is looking for a consultant to be proactive at sitting down at the negotiating table, negotiating contracts with unions, and winning cases in arbitration, with a track record of success in cutting costs and experience in self-funded insurance.
He set up a committee of Board of Education representation with Superintendent Leone and Business Manager Batchelder, and City representation with himself, Purchasing Agent Zucco, Comptroller Proulx, Personnel Director Gritt, and Administrative Assistant Nocera. The seven reviewed 11 proposals, he said, which was a daunting process to read close to 1000 pages of information. They put together a basic rubric that included points for experience, local vendors, experience with the public sector, collective bargaining negotiation experience , knowledge and strength of personnel, evidence of prior success in reducing costs, innovative changes made for current clients, price, fee, availability, proximity to Torrington, completeness and clarity of response. Mayor Bingham said they decided to interview the top three: Lindberg & Ripple, Inc., Locton Companies, LLC, and CBC Kane Partners, along with interviewing the current Health and Welfare Consultant, Bozzuto Associates, Inc. He said they
tried to be as democratic as possible and Lindberg & Ripple were the top choice by a large stretch.
Mayor Bingham said the committee wanted a flat fee instead of the formula that Anthem comes up with that basically has to do with plan size -- if our plan size grows, their fee grows. They wanted to do away with that because there's no incentive to drive down costs. Their current vendor is paid between $46,000 and $47,000. Mayor Bingham said Bozzuto didn't do a bad job, but this is something he thinks is good for the City.
Mayor Bingham said a lot of money won't be saved in weeding out the services that Anthem provides. The most financial savings will be from negotiating changes to plans and benefits and keeping employees healthier. He said he wants to move quickly, asking unions for givebacks on health benefits, allowing a greater chance to save money than in another wage concession. He said we'd rely on the expertise and experience of a company that would give us recommendations regarding increased co-pays or particular plan changes.
Councilor Carbone asked for examples of where this company was able to save money. Mr. Gritt replied that Lindberg has negotiated health savings accounts, a high deductible plan, as a core plan in a municipality. They are very good in getting involved in negotiations, with a lot of experience going from negotiations to mediation to arbitration if necessary, he said, and they are one of largest privately held brokerages in the state, represent 38 towns, and have labor relations staff that are well known in that field. He said they have been involved in purchasing coalitions, where municipalities got together to shop for life and dental insurance and they do wellness programs and employee education programs because HSAs are very difficult to understand.
Councilor Carbone said her concern is that we've not paid a consultant in the past to look at these, but use an agent to shop the plan and, through Anthem, receive the commission. She asked if it's possible this consultant will come back and say we already have the best plan. Mr. Gritt said we have to have major discussion in this City about what we want to do with these plans, it's a 16 million dollar item and we need to find ways to save money with it. He said he can guarantee Lindberg & Ripple is not going to recommend the same plan because it just keeps going up 10, 12, or 14% a year. He said we need to have resources to comprehensively pull all this together, come up with a plan, line up negotiations, and try and implement these things. Mr. Gritt said the City has to have the desire and fortitude to stick
through an arbitration process.
Councilor Carbone said she is concerned about the commitment without knowing if we'll have any great results, since it's almost $60,000 in expenses above the lowest cost estimate. She asked if Lindberg & Ripple talked about trends in their effectiveness since over the last three years our rates have increased less than 10%. Mr. Gritt replied that where more money is made is in plan design changes – the ability to get the plan less rich, to share the costs with the people that are using it, to get them educated as to what those costs are. He said the greatest benefit of bringing in someone like this is the negotiating process.
Councilor Carbone asked if Lindberg & Ripple could be hired on an as-needed basis, just for the negotiation piece. Mr. Gritt replied they have to intimately know what our plan is, what our cost drivers are.
Councilor Dalla Valle asked what the savings would be, based on dealings with other municipalities. Mr. Gritt said in his general conversations with them they are running about what we're looking at. Mayor Bingham said other towns in the area are not self insured; they are premium based.
Councilor Dalla Valle asked what kind of figures can be expected. Mayor Bingham said the increases you would see are negotiable, the smallest part. The largest savings, he said, is their experience in plan changes, negotiating with unions, and wellness programs – the other 75% of the cost. Mayor Bingham said Lindberg & Ripple have a proven track record with that.
Councilor Carbone asked if they have provided examples of significant savings they were able to accomplish. Mr. Gritt said their major item is a HSA which is very controversial with AFSME unions and they resisted as much as they could. He said now is the time to make changes as arbitrators are more open.
Councilor Carbone said the HSA is in the contracts already, as an option. Mayor Bingham said it's fairly ambiguous. Mr. Gritt said the next step has to be to not make it an option, offer that as core plan and have employees pay the difference between the PPO and the HSA.
Councilor Carbone asked if the company we’re using now is unable to provide that service to us. Mr. Gritt said he wouldn't say they're unable.
Councilor Carbone said she is struggling with the notion of paying a consultant $50,000 to provide this service. Mr. Gritt said it's about changing how it's paid, going from a commission basis which is built into the premium or just a flat rate. He said it's the same money, not $50,000 more. Mayor Bingham said it's about a two or three thousand dollar difference, but what you get for that in terms of experience, know-how and expertise is incomparable. He said there is a vast difference between the company we have now and the company he is recommending.
Councilor Waldron asked about the length of the contract. Mrs. Zucco explained it's for two years, with an option to renew for the third and fourth year at the rates specified, with City Council approval. Councilor Carbone asked for clarification on the vote, that it's not to approve a $50,000 contract, but rather to approve the committee's recommendation. Mayor Bingham said the contract has to be firmed up, and brought back for Council approval.
Mrs. Zucco read Mr. Leone's response from the Board of Education to the Council, saying Lindberg & Ripple were the overwhelming selection to a) help lower insurance costs, b) help educate staff and c) plan for the future. They had the most comprehensive presentation, he wrote, and put forth the best, most competent proposal that showed experience with other cities and Board of Ed clients.
Mayor Bingham said there's been some tension between the City and Board of Education about health insurance and we've worked to inform the staff and key members of the Board of Ed how this all works. He said we're now at the point where we're moving in the same direction, knowing we have to key in on the true cost drivers.
Councilor Carbone said she is a big proponent for evaluating anything we do and it's critical that there be an evaluation that comes before the Council. If we're going to make this kind of investment, she said, she'd like to see what those results are, how we are doing in the negotiations, what the savings are, if we are getting what we pay for. Mr. Gritt said this will be evident in the second year because that's when those 3 contracts will be negotiated, and we'll be trying to make the major changes that we can. He said Lindberg & Ripple can also help us come up with some proposals to present to the Unions before this budget is over, because
we'll be going very hard at trying to make some major changes there. He said the results will be seen. Councilor Carbone said she'd like to go on record saying in her experience participating in contract negotiations for the Board of Education she found the representative from Bozzuto Associates, Inc. to be helpful answering questions, offering advice for savings, and setting parameters for negotiations.
POLICE DISPATCH CENTER #1569 On a motion by Councilor Dalla Valle, seconded by Councilor Waldron, the Council voted unanimously to award a bid in the amount of $49,389.00 to Xybix Systems, Inc. of Littleton, CO for the Police Dept. Dispatch Center, including optional items requested by the Police Dept. in the amount of $5,031.00, as approved by the Board of Public Safety on March 24, 2010.
Mayor Bingham explained this is part of a Justice Department Grant, and may be used as a back-up system. Chief Maniago said this bid includes consoles, equipment to hold monitors, keyboards, and computer equipment, chairs, and storage space savers -- rotating racks for all the binders & informational charts needed at dispatch. The optional items include cable to run technology equipment, he said, and this is a complete overhaul of the entire dispatch center including wiring and cable technology.
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