City seeks advice for user fees

Published 6:58 pm Monday, August 21, 2017

The Board of Mayor and Aldermen Monday hired two consultants and authorized advertising for a third as they try to get a handle on the city’s soaring employee health insurance costs and begin moving closer to raising water and sewer user fees for city residents.

The board authorized Chicago-based HUB International, which has an office in Ridgeland and specializes in employee benefits, and its representatives to meet with city officials to discuss ways the city can save money on employee benefits.

It also approved hiring the Jackson engineering firm of Allen & Hoshall to do a water system rate study, and authorized city clerk Walter Osborne to advertise for proposals for a facilities study for the city’s sewer system.

Mayor George Flaggs Jr. said the costs of Vicksburg’s self-insured health program are increasing, and the board needs to find ways where it can reduce costs without affecting coverage.

The city’s health insurance costs have gone overbudget for the past two years, city finance director Doug Whittington said after the meeting. He said the insurance program finished fiscal 2016 with a $1 million deficit, requiring a budget amendment to cover the shortage. He said another $1 million budget amendment for insurance for fiscal 2017 will be presented when the board meets Friday.

The board in October opened a city-sponsored clinic where employees and their families could get medical care at no charge and would not have a co-pay, but Flaggs said employees are not taking full advantage of the service.

“We’ve got a dilemma right here in Vicksburg,” he said. “In spite of having the clinic for the employees, they’re still going to the emergency room for things they can go to the clinic for and costs nothing.”

Also, he said the costs for Blue Cross, which administers the city’s plan, “Seem to keep going up and gone up.”

“I share some of that responsibility, because the first four years I was trying to find out where the bodies were buried and I didn’t dig into the (health insurance) question and talk in detail as we should have been talking about on the pharmacy part and some of the other costs. So we’re going to be looking at our health care costs and how we can reduce that.”

Flaggs on July 9 appointed a 10-member committee to look at the city’s water and sewer rates, and indicated then the city could see a raise in water and sewer user fees.

“I’m just putting the city on notice, because if you’re going to grow and expand the way we’re talking about growing and expanding and developing the city around it, we’re going to have to put some money out as relates to water treatment and wastewater in this city, because we’re at a breaking point,” he told the board at that time.

The request to hire Allen & Hoshall to review the water rated came from the committee, city attorney Nancy Thomas, one of the committee members said. She said the rate study “would help us out, and we can take a look at what’s needed, what we have and what’s in surrounding communities.”

Thomas said the facilities assessment for the sewer system is required before the city can apply for revolving fund loans to repair and upgrade the city’s sewer system.

Money for the loans comes from federal funds, which are administered by the Mississippi Department of Environmental Quality, and require the city to follow federal procurement guidelines in hiring a firm.

The assessment looks at the city’s sewer collection and treatment facilities, and examines the system’s rate structure.

“The city has to prove it able to pay off the loans,” Thomas said.

Whittington said the loan payments are taken from the city’s sales tax revenue, and the money from the sewer user fees reimburse the general fund.

About John Surratt

John Surratt is a graduate of Louisiana State University with a degree in general studies. He has worked as an editor, reporter and photographer for newspapers in Louisiana, Mississippi and Alabama. He has been a member of The Vicksburg Post staff since 2011 and covers city government. He and his wife attend St. Paul Catholic Church and he is a member of the Port City Kiwanis Club.

email author More by John