Cost Saving Idea - Town/County Health Insurance

Government consolidation is in the news as Governor Cuomo announced a $20 million competitive grant program to encourage consolidations and restructurings.  In order to be eligible for a grant, the proposal much prove it lowers property taxes.

Recently, an official from another town told me about a proposal floated a few years ago to have the towns and county purchase employee health insurance as a large group.  The theory that the combined work forces had enough employees to provide a discount of up to 20% of what the towns/county are paying.  Sadly, the idea never advance beyond the discussion phase.  All municipal governments saw big increases in health benefits last year.  

I believe this proposal should be revisited.  According to my calculations, a 20% reduction in health premiums would save $418,000 and lower property taxes by 4.4%.  

2017 Budget	Health Benefits	20% savings
General Fund	$1,149,256	$229,851
Outside Village	$586,111	$117,222
Highway	$356,864	$71,373
	Total Savings	$418,446

What if Saugerties Property Taxes Increased as the Same Rate as Inflation?

	What if Saugerties Property Taxes Increased as the Same Rate as Inflation?
	*CPI = Inflation
	2017 Actual	5 Years	5 yrs	10 Years	10 yrs
	Property Tax Levy	2017 Levy  - CPI Adjusted from 2012	% + or -	2017 Levy - CPI Adjusted from 2007	% + or -
Town	$6,961,710	$5,842,701	19.2	$4,826,404	44.2
School	$37,190,000	$36,864,039	0.9	$29,913,368	24.3
Highway	$2,885,504	$2,841,877	1.5	$2,952,976	-2.3
County	$76,893,016	$82,437,020	-6.7	$81,181,243	-5.3

This spreadsheet shows what 2017 property taxes WOULD HAVE BEEN if local governments held tax increases to the rate of inflation over five and ten year periods.

For example, if  the Town held General Fund property tax increases to the rate of inflation over the last ten years, the tax levy would be 44.2% lower than the actual 2017 tax levy.  If the town held taxes to the rate of inflation over the past five years, the tax levy would be 19.2% lower.

Property Tax Summary for Village of Saugerties Property Owners - 2007 to 2017

Tax Bill $200,000 assessment	2007 Bill	2017 Bill	$ Increase	% Increase	Ave. Increase	CPI**
Town A	$500*	$802	$302	60.3%	6.0%	1.67%
Village	$1,478	$1,272	-$206	-13.9%	-1.4%	1.67%
Ambulance	$51	$82	$31	60.9%	6.1%	1.67%
Library	$38	$113	$75	197.9%	19.8%	1.67%
County	$752	$871	$120	15.9%	1.6%	1.67%
School	$2,267	$3,429	$1,162	51.3%	5.1%	1.67%
TOTAL	$5,085	$6,569	$1,483	29.2%	2.9%	1.67%

*Estimate

**CPI is the average rate of inflation from 2007-2016.

The average Village homeowner is paying $1,483 more in taxes compared to ten years ago.

NOTE - Highway & Fire Prevention services are included in the Village budget.  The Police Merger occurred in 2011 & Village residents are billed from the town wide General Fund.