Fort Smith board opposes Arkansas Municipal League plan (Updated)
by October 12, 2010 2:21 pm 74 views
The Fort Smith board of directors are not happy with an attempt by the Arkansas Municipal League to pursue legislation that would force the city into a workers’ compensation insurance pool and away from the city’s self-funded system.
Such legislation was an agenda item at the board’s Tuesday (Oct. 12) study session.
The 2010-2011 legislative goals of the Arkansas Municipal League (AML) include support of legislation that would remove the exemption Fort Smith and Little Rock have that allows them to manage their own workers’ compensation system. Removal of the exemption would force the cities to consider joining a larger insurance pool, like the one managed by the AML.
Fort Smith Human Resources Director Richard Jones said moving from the self-funded plan could cost the city up to $200,000 more a year. Deputy City Administrator Ray Gosack said early talks with Little Rock officials indicate the law change could cost that city up to $800,000 a year.
City Directors Cole Goodman and Bill Maddox claimed that AML chief Don Zimmerman never contacted them about changing a law that could be potentially costly to the state’s two largest cities. Goodman, who has a surgeon said his direct work with the city’s workers’ comp system leads him to believe it is one of the best around, said the AML is out of order with the proposal.
“I am somewhat offended by the municipal league that they would do this end run around us” and go to the Arkansas Legislature before seeking the city’s input, Goodman said.
Maddox was more blunt in his assessment.
“He (Zimmerman) wants all the power and all the money to come to the municipal league,” Maddox said.
Updated info: Zimmerman said the league did not do an end run around the city, explaining that the proposal “has been through all the processes” of the league and was discussed at the annual convention. He noted that several Fort Smith officials, including City Director Gary Campbell who presided over the league’s annual convention, were present when the league approved the plan.
Also, Zimmerman told The City Wire he believes Fort Smith’s workers’ comp costs are about $700,000 a year for about 900 employees. He compared that to about $500,000 a year for North Little Rock’s 1,000 employees who are not part of self-funded plan similar to that of Fort Smith.
However, Zimmerman said Fort Smith officials have been unwilling to share their numbers in the past few months but is hopeful that a Nov. 3 meeting with Fort Smith and Little Rock officials will allow all parties to look at real numbers.
“I think they will see the savings” of moving to a private insurance plan or a self-insured plan through a group,” Zimmerman said.
Zimmerman also denied the proposal is part of an effort to create more business for the league, saying that Fort Smith and Little Rock have many other options than the league plan.
City Director Steven Tyler said he spoke to Zimmerman about the proposed legislation and that Zimmerman said it was to prevent cities from getting into “catastrophic trouble” with their self-funded plans.
Goodman suggested that the city is capable of handling its own plans without Zimmerman’s input, and if Zimmerman was concerned he should have thought about contacting the city.
The board unanimously moved to approve at their Oct. 19 regular meeting a resolution opposing the AML’s proposal.
Gosack said after Tuesday’s meeting that city staff has been in contact with local legislators about the issue.
“We alerted the legislative delegation of our concerns with the proposed bill, and it was mainly so that they would not sign on as co-sponsors before the city took an official position on the bill,” Gosack said.
If the city board approves the resolution opposing the AML plan, then area legislators will be asked to help oppose it.