Retired city employees, representatives of nonprofit organizations and others voiced their concerns over the proposed fiscal year 2015 budget at a public hearing Tuesday evening.
A total of 35 speakers took to the podium to speak out against Mayor Sandy Stimpson’s proposed budget, which cuts performance contracts by more than $2 million, raises health insurance costs for current and former city employees, but increases spending on capital projects by slightly more than 400 percent.
The budget, as it reads now, would increase the monthly premiums of current employees from $54 to $69 for single coverage and from $140 to $180 for families to match an 80/20 split. The city would pay the difference in premiums for employees making $40,000 or less for the first year.
Current employees would also see a 2.5 percent cost-of-living adjustment and a 2.5 percent merit raise.
Retirees who are not eligible for Medicare would see a steeper percentage increase from $54 to $103 a month for single coverage and $140 to $210 for family coverage.
Retirees eligible for Medicare would be cut from the city’s plan, but would be provided with a subsidy of $175 a month to use toward a supplemental plan for four years.
Retired city finance director Lynnwood Morrison told the council that the changes in healthcare costs shouldn’t affect current or retired employees. He said the guarantees given to those employees should be considered verbal contracts and therefore shouldn’t be changed. Morrison said the administration was trying “to pull the rug out from under the retirees.”
“Many are in need of the benefits that will be eliminated,” Morrison said. “I suggest to the mayor and council that the honorable thing to do would be to honor the promises made to employees.”
Morrison also suggested the council take about half of the money reserved for capital expenses in the 2015 budget and put it toward healthcare costs so the Medicare-eligible employees aren’t cut from the plan.
Stimpson spoke to the standing-room-only crowd during the hearing. He announced that he had met with Chief James Barber and other police representatives to discuss making adjustments to the proposed cuts. He said there would be time to discuss adjustments because the new healthcare cost-sharing plan doesn’t go into effect until Jan. 1 and retirees over 65 remain part of the plan until April.
He said the city would consider moving non-Medicare employees to an 80/20 cost-sharing plan, per Barber’s suggestion. Stimpson also explained that the subsidy for Medicare-eligible retirees would be coupled with the $140 a month they wouldn’t have to pay to be part of the city’s plan, equaling $315 they could use for a supplemental plan.
Former Police Chief Michael Williams spoke to the council about revising the proposed changes to the health insurance for retirees.
“I greet you on behalf of the people who’ve shed their blood on the streets of Mobile for the people of Mobile,” he said. “Please don’t turn your back on us.”
Williams told the council to help keep the promise made by previous administrations.
“These people live check to check and any increase in health insurance contributions causes an issue for those employees, especially retirees who budget around a fixed income.”
The council also heard from representatives from various benevolent organizations, who had funding through performance contracts cut in the proposed budget.
Dr. Monica Motley, president of the Alabama School for Math and Science, told councilors that the economic impact of the school’s presence in Mobile could be measured at about $12 million annually because the school hosts several events and tourists.
Motley added that students at the school perform community service in the city and several students have brought the city national acclaim. Motley said, for instance, a student this summer was invited to the White House to meet President Barack Obama, after he created a prosthetic leg out of a used bicycle.
Lanita Kharel, executive director of AIDS Alabama South, also made a plea to the council, after the organization wasn’t given any money in the 2015 proposed budget. Kharel said from January to June there were 50 new cases of HIV in Mobile. She said 85 percent of HIV cases are diagnosed in teens and adults between the ages of 15 and 29. She said her organization, which has seven employees and serves 404 clients was asking for $16,000 from the city.
The council heard from representatives from Penelope House, a facility for domestic violence victims and McKemie Place, which shelters unaccompanied homeless women; and Family Promise of Coastal Alabama, a shelter for homeless families with children. None of the three organizations were funded by the city in the proposed budget.
Jessica James, executive director of McKemie Place, said the organization requested only $15,000, which is less than 5 percent of their operating budget. She said the shelter has served more than 2,000 women total and more than 400 last year.
Teresa Ramsey, of Family Promise of Coastal Alabama, told the council that her organization asked for $24,300 from the city. The money would be used to match funds for federal money to help shelter the families.
It is likely that the City Council will table a vote on the budget for at least two weeks, although the issue will appear on next week’s agenda. The council, after a lengthy discussion, also tabled a vote on extending the sales tax increase from July to September of next year.
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