City Council pay under review

South Portland will hire a consultant to study the panel's compensation package

SOUTH PORTLAND — The South Portland City Council has set the wheels in motion on a compensation study that could lead to a replacement for its health insurance benefit, due to expire at the end of November 2013.

In a workshop session Nov. 14, councilors directed City Manager Jim Gailey to hire a human resources consultant to lead a commission to be formed early next year to study their total compensation package. After comparing what South Portland councilors are paid to what their peers make in surrounding cities and towns, the commission may recommend amendments to the city charter that could go before voters next year, less than a month before the existing benefit is set to expire.

If Gailey can find someone to lead the commission through its research and deliberation for a fee of less than $15,000, he is allowed under council policy and city ordinance to make the hire himself, without putting the contract out to bid or bringing the item back to the council for a vote.

“I certainly expect I can find someone for less than that,” he said, following the workshop.

On Monday, Gailey reported via email “no updates” on the search.

The only mention of compensation in the City Charter is a $3,000 stipend, set the last time the document was amended in 1986. However, since 1977 councilors have had the option to get on the city’s health insurance plan as “employees,” with individual premiums fully borne by the taxpayers.

On Sept. 5, the council voted 5-2 to no longer allow health care coverage councilors past Nov. 30, 2013. After that date councilors may continue to enroll in the city's health insurance, but they will have to foot premium expenses out of pocket.

The decision came after nearly a year of sometimes-acrimonious debate, which included a lawsuit filed by resident Albert DiMillo Jr., a Current columnist, to force a the issue onto the council’s public agenda.

Mayor Patti Smith said she chose to “start the ball rolling” last week, even though two members of the council will be replaced by new members Dec. 3, while a third plans to resign in January to take another office.

“I didn’t want to lose that internal knowledge and information before we get into the nuts and bolts of this,” she said.

While councilors Maxine Beecher and Tom Coward took part in authorizing the hiring of a consultant – Rosemarie De Angelis was absent from the meeting – it will fall to their replacements to make what is potentially a more challenging decision: How to staff the commission.

“How do we create a commission that’s well-diverse with varying opinion?” asked Councilor Alan Livingston. “That’s my concern. I don’t know exactly how we do that.”

Most of the councilors present seemed to favor allowing the consultant to pick commission members, for fear of being accused of cronyism. However, Gailey discouraged that notion.

“That’s be like me going to Scarborough and picking people, and I don’t know anyone there,” he said.

Although how commission members will be chosen remains up in the air, councilors agreed via consensus that it should include seven members, should employ public hearings in its decision-making process, and should wrap up its work by next summer.

“I wouldn’t make it any more than seven,” said Beecher. “Any more and it just becomes a cumbersome fight to the finish.”

“I would recommended several public hearings or some sort,” said Coward. “That way, everyone can have their say, whether they want us to work for free, or be salaried with limousines and gold-plated bathrooms."

Coward also suggested that council members be allowed to address the commission at public hearing.

“It’s wise for councilors to keep some distance from the actual recommendations, but we all have our different points of view and we also have more direct experience than anyone else with this issue,” he said.

“I’d like to think this can all be done within six months,” said Livingston.

“We took three years to do the entire comprehensive plan, from top to bottom,” joked Coward. “So, proportionately, we ought to be able to do this in about a week.”

At present, two councilors – Beecher and Jerry Jalbert – take advantage of the fully-paid individual health plan. However, Beecher is term limited and will be out of office Dec. 3, while Jalbert has promised to forgo the benefit as of Jan. 1, when he becomes eligible for private plan from his new employer.

Two councilors, Coward and Tom Blake, are now signed up for family plans, for which the city covers 85 percent of the premium, to the annual tune of $14,418.

By contrast, Dr. Frank Morong, who sat on the City Council in 1977, said full medical coverage at that time cost “probably $200 or $300 a year.”

Coward won election to the Cumberland County Commission Nov. 6 and will resign his council seat in January when inaugurated to his elevated station.

Mayor Patti Smith, Councilor Alan Livingston and outgoing Councilor Rosemarie De Angelis have declined the benefit. Linda Chowen and Melissa Linscott, both elected to the council Nov. 6, promised in an Oct. 25 debate to also decline health insurance coverage.

That will leave Blake as the only councilor taking advantage of the plan. Although away on vacation and absent from last week’s workshop, he called first, loudest and most consistently for the commission during the previous year, as the council struggled with how to answer De Angelis' constant call to end the benefit, while also trying to fend off DiMillo’s lawsuit.

Local resident Dan Mooers first raised questions about the council’s health plan in 2008. He noted it is not cited in the city charter, which lists a stipend as the sole compensation.

“Without any question in my mind, the action of putting councilors on medical insurance some 35 years ago was an illegal vote because it violated the charter,” said Mooers. “In my opinion, every year in which the council adopts a budget with contains specific expenditures for their personal benefit, each councilor for whom money is allocated violates both the South Portland conflict of interest ordinance and the state of Maine conflict of interest statute.”

After several meetings on the topic in 2009, City Attorney Sally Daggett issued an opinion that the benefit is legal under state law despite its absence from the charter. The issue died but came to a head again last fall at De Angelis' behest during her last workshop as mayor. Although an outside attorney rendered an opinion that countered Dagget’s, the council appeared ready to drop the issue once more, until DiMillo interceded. He dropped his suit in June on the promise by Smith that the matter work return to a future workshop agenda, as it did in September.

“I’m not disappointed, I’m appalled,” said De Angelis at the time, berating her fellow councilors for declining to end the benefit immediately, as she preferred.

“This is a $101,000 line-item liability for this city that the residents never voted on. That’s all that matters,” she said.

When the charter was adopted in 1963, it stipulated, "The annual compensation of Councilmen shall be $600." The pay rate was bumped to $1,000 by the state Legislature in 1965, and then by local voters to $1,500 in 1971. In 1977 the City Council voted to take advantage of a 1969 change in Maine law that broadened the definition of "employee" to elected and appointed officials for purposes of group health insurance policies. The council at that time voted itself full health insurance coverage and the benefit has since been part of every annual budget.

Morong said Monday that he could not specifically recall how debate on the topic fell on the issue in 1977. However, he said, “we must have had advice from legal counsel."

In 1986, voters set the stipend at $3,000, where it's remained ever since, but no reference has made to the health benefit during that year’s charter commission. Marilyn Riley, a frequent audience speaker on the topic, has claimed few voters at that time knew the benefit even existed.