HUNTSVILLE – The Town of Huntsville may be putting some money in the bank a year after opting out of a District of Muskoka group benefit plan for municipal employees.
Lisa Smith, executive director of organizational development and strategy for the town, told the corporate services committee on Oct. 11 that by going it alone on a life and disability benefits plan, the town not only saved money this year, but also ended up with a surplus of $67,976.46.
Smith said the surplus was a result of low administration costs and a stop loss insurance rebate, among other factors. Stop loss insurance protects employers from catastrophic claims or unexpected increases in overall use, according to one provider.
Committee chair Coun. Chris Zanetti was pleased with the surplus.
“I don’t think we ever would have got that with the district,” he said.
Mayor Claude Doughty quipped, “They didn’t get it for themselves, either.”
The committee table erupted with laughter.
Smith noted staff would return to the committee in future with a recommendation as to what will happen with the surplus.
The town had previously dropped out of shared information technology services with the district and ultimately saved money. And then, about a year ago the town investigated whether it would save money by dropping out of the district benefits plan and finding its own benefits provider. By switching, the town paid about $30,000 or 23 per cent less than when it was as part of the district plan and ended up with the surplus as well, said Smith.
Doughty told the Huntsville Forester he was over the moon with the amount of money town staff was saving taxpayers through the benefits changes.
“It’s a great start,” he said. “Bring on more.”
The benefit plan cost reduction combined with the surplus amounts to about $98,000, which is close to one per cent of the town’s roughly $10 million annual budget. Doughty said he has been commenting for years at the district level about avenues such as this for potential savings.
He said he is now analyzing the cost of road maintenance and whether the town would save money by taking over responsibility for the district roads in the municipality.
The engineering and public works department has the largest budget by far at the district and each of Muskoka’s six area municipalities pay taxes to the district each year to cover it.
The department’s 2012 capital budget is about $92 million and its operating budget is about $67 million.
“If we all just kept the money that we put in the pot for roads and did it ourselves, what would that look like?” asked Doughty. “It shouldn’t work. It should be more effective if we all work together.”
But if it actually costs more to work as a group on roads, perhaps going it alone may be the right thing to do, he added.
Doughty noted the town could then also focus on the roads it deems of most importance.
“Our view of where we would spend capital money as an area municipality might vary significantly from where the district would deem it appropriate,” he said.
Doughty said he had been asking the district during this term of council to give consideration to upgrading Aspdin Road as a major east-west connector of regional, if not provincial, significance, but to no avail.
“They continue to do surface treatments on that road and that’s not something we think is appropriate,” said Doughty. “We would rather spend more money on that kind of a road and less money on secondary or tertiary roads, which is not the approach the district takes.”