Ward 5 Councilman Ed Ladouceur has only started in his effort to trim so-called “legacy” costs and give Warwick a sustainable financial future.
Last Monday, the councilman amended his proposed ordinance that would introduce health care co-payments for retirees. He said the provision to do away with health care for retirees would be limited to new employees, thus seemingly removing the concerns of existing retirees whose family health plans are costing $23,000 and promise to only keep rising.
A number of municipal employees, in addition to firefighters who turned out for the vote on their contract, filled the council chambers. Indeed, Ladouceur’s health care ordinance was on their minds.
Ladouceur amended the ordinance and asked that it be placed for consideration on the Feb. 24 docket.
But if it appears Ladouceur is only thinking of reducing the financial strain on taxpayers in another 25 to 30 years when “new” employees retire, then think again. His ordinance would establish health care co-payments for existing retirees.
In an interview Thursday, Ladouceur estimated the ordinance could save the city “several million” a year as soon as it is passed. If approved – and assuming it withstands a seemingly likely legal challenge – the ordinance would require retirees to share in the cost of their health care if their pension payments exceeded $30,000 annually. At that point, retirees would pay a minimum of 25 percent of health care. He is thinking of a scale where the greater the pension, the more a retiree would share in the cost of their health care.
Ladouceur hasn’t worked out the scale, and that was partially the reason for delaying consideration of the ordinance. He is also looking to garner more data on potential impacts of the legislation.
However, without taking steps to rein in the escalating cost of providing health care to retirees, the councilman is convinced not only that taxes will need to increase annually but that the system is unsustainable – and could quite possibly collapse – meaning all involved will lose.
“We’re going to start the debate with what we have right now,” he said. “It is not fair and equitable to everybody and certainly not sustainable.”
Ladouceur estimated the annual cost of health care for retirees at $10 million and climbing. To his way of thinking, retirees receiving $30,000 in pension payments annually are “grandfathered in” for health care. He is especially troubled by retirees who receive $100,000 and more in pension payments as well as fully paid health plans. He believes in some cases retirees are actually being paid more now because they no longer co-pay for healthcare.
“We can no longer sustain this for employees [retirees] with $50,000 and $100,000 pensions,” he said.
Asked about a possible lawsuit should an ordinance pass, Ladouceur said, “A lawsuit is possible. All I know is that we can’t continue the way it is. When it all comes crashing down and they [retirees] lose health care, then what?”
“Everybody has got to start paying their fair share,” he said. “Every time health care [costs] go up, we pass the burden along to the taxpayer.”
Ladouceur and his three colleagues who wanted more information of the firefighters’ contract felt the pressure of the unions to vote for the contract, which they didn’t. Zach Colon, who is running as a Democrat for Ward 8, criticized Council President Steve Merolla in a press release. He said Ward 8 deserves “a councilor who is willing to stand up and do what ever it takes to make sure that employees serving our community and ourselves are treated fairly and with dignity.”
Ladouceur knows of no opposition candidate in Ward 5.
“My job is not about getting re-elected. I’ll leave that up to the people. My job is to do what I feel is right for the city,” he said.