Proposed referendum would ask city residents to raise levy to fund retirees' healthcare

Aug. 15--RACINE -- Almost a year after the City Council approved reductions in health benefits for city staff and retirees, a proposed referendum would ask taxpayers if they are willing to increase the levy in order to pay for retirees' health benefits.

The proposal, which is scheduled to go before the council's Executive Committee at a 5 p.m. meeting on Monday, is asking for a $3.5 million or approximately 6.49% increase to the levy in 2021 and then an additional $1 million each year thereafter.

For 2020, the city collected a total of $53,820,230 in property taxes. Because the city had zero net new construction in 2020 the most it would be able to raise its levy is 0.15% or $80,730.35.

If voters approve the referendum, the city could collect up to $57,400,960.35 in 2021.

The fight over benefits

During the budget process last fall, the City Council approved changes that reduced the city's health plan options to a single plan with a set contribution of 7.5%, calculated at $55 a month for an individual and $145 a month for a family.

Retired firefighter Mike George said there's a clause in their contract that states that whatever premium they paid when they retired is the premium they pay for life under the city's insurance. The city can change deductibles and co-pays, but their contract stipulates that premiums cannot change.

Current and retired city employees protested for days and gave impassioned public comment before the council. Despite warning about the potential legal liability, the measure was approved by the council by only one vote.

Last month, three groups of retirees from the City of Racine -- 352 individuals including retired firefighters, police officers and public-works employees -- filed claims against the city for those health care changes. The council voted 7-5 to disallow the claims, which George said could force them to take legal action. As of Friday, court records did not show any such case had been filed.

As of Friday, it was unclear whether the funds from the referendum language would stipulate bringing retirees' benefit back to their pre-2020 levels or if it was to sustain the level of benefits they'd received this year.

If the proposal passes at the Executive Committee on Monday, it would go before the City Council's next scheduled meeting at 6 p.m. Tuesday. Both meetings will be held virtually and can be live-streamed at the City of Racine's Facebook page.

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