Allegheny County Controller Chelsa Wagner today called on County Executive Rich Fitzgerald to provide retired employees with the life insurance benefits that they were promised.
As part of a provider switch to Lincoln Financial beginning in 2014, the County communicated to retirees that they would now receive $4,000 in life insurance benefits, despite the fact that those retirees had previously been promised $10,000 in life insurance by Allegheny County. This abrupt reduction in benefits affects more than 1,000 retirees. Today, Controller Wagner submitted a resolution to County Council asking it to move and allocate $200,000 from the 2014 operating budget to secure the $10,000 in life insurance for retirees, and to ensure that all retirees receive the benefits they were promised and deserve.
It appears that in the past, the County actually insured most individuals for $3,000 to $4,000 upon their retirement, despite telling them they had life insurance valued at $10,000, and in fact paying out $10,000 in benefits at various times upon the death of a covered retiree. Wagner noted that her office and other County offices have fielded concerns from retirees for over a year, and that the Retirement Board (to which she, Executive Fitzgerald, County Council and others are members) discussed the matter on numerous occasions and in the most recent Retirement Board meeting on February 20, 2014.
“While it appears there had been mistakes in the administration of the life insurance benefit in the past, prior mistakes and confusion are not an excuse for current inaction,” Wagner said. “This administration has been aware of this problem for over a year, but has failed to work out a resolution in spite of numerous requests to do so. Accordingly, I am publicly calling on Mr. Fitzgerald and Council to take action. I receive calls from angered and confused retirees every week. One call was too many. Already, too many retirees and their families have been deprived of their dignity in their neediest and last hours. This is not only a legal matter and a matter of policy for this County – it is a moral obligation.”
In her legislation, Wagner asked Council to use its budgetary power to reallocate $200,000 out of their $817.3 million operating budget.
“What angers me most is that this is a simple and relatively inexpensive fix,” Wagner said. “I’m asking Council to use its budgetary authority to pay these retirees the benefits they earned and the respect they deserve. To put this added cost into perspective, we are asking this administration to reallocate two-hundredths of a percent of its total $800 million budget, and the Controller’s office will lead by example and be the first office to demonstrate those savings. This isn’t difficult. It’s like asking a family of the median household income in this County – of $50,000 – to skip one $12.50 drive-through meal at McDonalds once this year.”
