HomeMy WebLinkAboutLeague - Entitlement SharesMemorandum
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Montana League of Cities and Towns
JUN 1 5 2004
GITY OF LAU IEL
League of Cities and Towns Members
Alee Hansen
Entitlement Share Payments and Health Insurance
June 14, 2004
Entitlement Share Payments --- the attached sheets show the Entitlement Share Payments
cities and towns will receive from the state in the coming fiscal year. The growth rate is
76% 0fthe four-yeur av~mg~ increase in p~r-~apita incbme and~g~6~'slhI~' ~ro~d'u~ .WThe
cumulative rate for this year is 3.46%, which indicates a marginal improvement in
economic conditions. This formula is designed to connect transfers to the performance of
the state economy, which is a square deal because these are the factors that drive state
revenue collections.
The growth rotes for individual cities are not uniform, because 50% of the formula is
based on population, while the balance is figured on the amount of gambling, liquor,
vehicle and financial institutions tax revenue that cities gave up in the first year of the
program.
Health Insurance Plan --- work is progressing on the development of a self-funded health
insurance plan for cities and towns. A committee organ/zed under the Municipal
Insurance Authority has decided on the following four-step plan to make health insurance
available to all League members over the next 12-months:
Renew the existing League group purchase program on July 1st with a 2.3% rate
reduction.
Self insure the League group on October 1st with an additional 2.7% rate
reduction.
Provide self-insured coverage to larger cities on January 1, 2005.
Combine the two programs on July 1, 2005 to spread risks and take advantage of
administrative savings and other cost reductions that would accrue to a large pool
of municipal employees.
Cities and towns currently enrolled in the League pool should renew coverage through
October 1st. Other members that are interested in joining this program should contact
Lauren Andrist at Western States Insurance. Her toll free number is 1-888-442-8013. If
you have any questions, please contact the League office.
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