white-plains-21-9959054In a case with potentially far-reaching implications for local taxpayers across New York, a labor arbitrator has ruled that the city of White Plains, in Westchester County, has the right to require police retirees to begin contributing to their health insurance.

Last year, the city moved to curb its retiree costs by requiring police and fire retirees hired before 1995, as well as elected officials, to start paying 15 percent of their (previously free) health insurance premiums.

The arbitrator’s decision is not posted online, but today’s Journal News summarizes it as follows:

According to the 45-page arbitration decision, the police union argued that its retirees have been given 100 percent health care coverage for decades and so the city could not change those past practices unilaterally. It also said the coverage level was contractually protected.

The city argued that the 100 percent coverage was never mentioned in any contracts with the union. Because it was not obligated to pay 100 percent, it could change the contribution level if it wanted. The city did not dispute that 100 percent was paid for decades.

The arbitrator, Arthur Riegel, agreed with the city’s claims and wholly denied the union’s grievance.

As the Journal News reports, the city’s action has also given rise to at least three other arbitration proceedings and five federal lawsuits from public employee unions. Last year a federal court granted a preliminary injunction temporarily preventing the city from collecting premiums from retirees while the case is pending.

As calculated in the Empire Center’s “Iceberg Ahead” report, the state and its local governments collectively have amassed completely unfunded retiree health care liabilities totaling more than $200 billion.  White Plains residents alone are on the hook for an unfunded retiree health liability of nearly $261 million, including the city school district.

Requiring some retirees to kick in 15 percent would save the city an estimated $500,000 a year.

About the Author

E.J. McMahon

Edmund J. McMahon is Empire Center's founder and a senior fellow.

Read more by E.J. McMahon

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