District 192 approves self-funded health care

Tables facility fee increase discussion

District 192 School Board unanimously approved a self-funded health care insurance program for the 2013-14 school year at its April 22 meeting.

The self-funded plan through PreferredOne would result in a 14.3 percent premium increase. The district would benefit from the plan because it could save 5-8 percent of administrative costs. The district would also fund and manage its own claims account, can build reserves to offset future health-related increases and involve employees as “good consumers of health care.”

The program would start on July 1, however, a revised proposal could be brought to the school board May 13 if the teacher’s union votes to enter a Public Employee Insurance Plan.

The state Legislature is reviewing statewide health insurance PEIP that would require irrevocable participation. Farmington Schools Human Resources Director Maryann Thomas said one scary thing about this legislation is, “the last line gives the commissioner the authority to impose a reserve surcharge for up to three years.”

Farmington could seek exemption from the statewide insurance as a self-funded organization that covers more than 1,000 lives.

The legislative and union decisions are uncertain at this time.

Board Member Laura Beem is a professional accountant and said, “In my opinion, this will save us the most money in the long run.”

The health care committee has worked with Corporate Health Systems for six months to explore options.

Facility fee increase tabled
After much discussion and concerns raised about increasing facility fees, the board decided to table the approval of fees until more information on financial costs is outlined and discussions with stakeholders happen.

The district has not increased fees since 2009 and created a three-year increase plan using averages from comparable facilities around the state.

Facility rentals currently run at a deficit because district groups pay no fees to use the facilities, but the deficit is picked up by other Community Education funds. The custodial labor contract also requires a janitor to always be in an open building, so this adds extra costs.

Board Clerk Julie Singewald pointed out that of the 160,000 hours, 89.5 percent are accounted for by this Tier 1 user group. About 7.3 percent of users are from Farmington youth organizations who pay a minimal fee but would be affected by the increase. She said she wanted to make sure discussions were focused on the majority of users and not the minority.

While these organizations were notified about a year ago of facility increases, some expressed concern to board members that this could make their participation fees cost-prohibitive.

Board Treasurer Brian Treakle said the district needs to figure out how to work with youth organizations so the increase in their participation fee does not impact their enrollment and cause these groups to operate at a loss.

“For me to vote on this now would be fiscally irresponsible,” Beem said. The board needed to understand the cost context before increasing fees, she said.

Community Education Director Heidi Cunningham said she believes the policy could be reviewed with discussions including stakeholders.

The board has asked for a more detailed report before budget decisions are made for the 2013-14 school year.

Next step for conservation easement
The board also authorized the administration to start working on an application with Dakota County and Minnesota Association of Soil and Water Conservation Districts to submit an application for a conservation easement.

The easement would cover 89 acres of the Angus Property, which is a 180-acre tract of land purchased by the school district for a future elementary school. The land in this easement is a flood plain, and through the program, the school board would get paid to conserve the land. The district could also use the area for educational purposes.

By agreeing to submit an application, the district is under no obligation or commitment to the property easement right now.

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