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City approves lower than expected insurance rates

Published: Monday, June 2, 2014 8:58 p.m. CDT

MORRIS – With the health care market undergoing major changes, Morris officials feared they would experience a spike in the city’s health insurance rate but were pleasantly surprised when the official numbers came in earlier this month.

The city was prepared for a 13 percent increase on insurance premiums – which was budgeted for fiscal 2015 – but the rate will only increase by 4.5 percent, said Morris Mayor Richard Kopczick.

“We have had rate increases as low as 1 percent and as high as 13 percent,” Kopczick said. “So we were prepared for the worst.”

After discussing the new insurance rate, the Morris City Council voted unanimously Monday night to renew the city’s insurance contract with Blue Cross Blue Shield for July 1 through June 30, 2015.

This is good news for the 73 full-time city employees and their families who will continue to have all of their insurance costs paid for with city dollars.

During budget discussions earlier this year, some officials feared the city could not afford to continue paying 100 percent of insurance benefits if rates kept increasing.

In fiscal 2014, the city saw about a 10 percent increase in insurance premiums, Kopczick said, and spent nearly $1.5 million for employee benefits. That was up from fiscal 2013 when the city paid roughly $1.3 million for benefits.

Morris’s budget preparers John Enger and Carol Adair expected to spend more than $1.7 million in 2015.

Kopczick said the Affordable Care Act imposed a federally mandated 3.25 percent tax, which accounts for most of the increase.

“Had it not been for the new tax, we would have only seen a 1.25 percent increase,” he added. “It was much less than we anticipated.”

Also Monday, the city officially approved tax increment finance district loans to the Morris Downtown Development Partnership and Living Water Church of the Nazerene.

The church was source of much discussion as some aldermen felt a church should not be eligible for a TIF loan, even though located in the TIF district, because it is not a property tax paying entity and therefore does not contribute to the TIF fund.

Aldermen Brian Feeney and Randy Larson voted against loaning the $55,000 to the church, but the remaining alderman favored the loan.

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