SOUTH PORTLAND — More than a week after a resident threatened to seek legal action against the city, officials are still looking into the propriety of providing free health-care coverage to city councilors.
Colchester Drive resident Albert Dimillo said Jan. 5 he would ask the state attorney general to bring embezzlement charges against the council if the city can’t prove that the council’s taxpayer-financed health-care coverage is legal.
“Why is this council stealing free health care?” Dimillio asked. “You have major problems legally. I think you’re illegally taking money.”
Last week, city officials released a copy of the 1977 council order that included councilors in the same insurance pool as city employees. The School Board does not receive those benefits.
City Manager Jim Gailey said when the 1977 order was passed, councilors were paid a $1,000 stipend, so insurance was added as a perk to encourage people into public service. In 1986, the City Charter was amended to increase that stipend to $3,000 a year.
Gailey said the remaining question is whether insurance coverage for councilors must be included in the charter, which can only be amended by a citywide referendum.
“It realy comes down to defining the word compensation,” Gailey said.
Given the current economy, however, asking residents to define compensation to include health care, when so many are struggling to make ends meet, could be a tough sell.
Human Resource Director John McGough said the city spends $70,000 a year to insure councilors through the Maine Municipal Health Trust, which also covers city employees. Councilors are also offered free Internet access in their homes through an arrangement with Time Warner Cable – one that costs taxpayers nothing.
Only newly elected Councilor Patti Smith is not enrolled in the city health plan. McGough said five councilors have family plans, for which they must contribute between $1,500 and $3,000 of the approximate cost of $11,300 to $15,500, depending on the plan.
McGough said the city fully insures all full-time employees and pays a pro-rated share of the single premium level for all permanent employees working between 20 and 35 hours a week.
“You are not employees,” Dimillo told the council. “The charter says $3,000, not $15,000. You’re making $15,000 for a lousy three or four hours a week.”
Michael Starn, spokesman for the Maine Municipal Association, said it is more common for some smaller communities, whose selectmen are also town administrators, to offer health coverage to their elected officials.
“South Portland is certainly the exception, rather than the rule,” he said.
When South Portland joined the MMA pool in 1977, Starn said it wasn’t uncommon for cities to offer insurance to councilors and selectmen, because health-care costs were relatively cheap. Municipalities began dialing back those plans in the late 1980s and early 1990s, he said, when costs were rising and local budgets were feeling the pinch.
Nicole Clegg, spokeswoman for the city of Portland, said Portland city councilors are insured through the city in addition to receiving a more than $9,000 annual stipend. Portland, however, is self-insured and only pays for health services rendered, rather than buying into the MMA pool.
Unlike South Portland, the Portland City Charter does not set a specific stipend for city councilors. Portland’s charter allows the council to establish its own compensation.
Meanwhile, municipal officials in Scarborough, Gorham, Auburn and Bangor said they do not offer health insurance to councilors. Augusta Human Resources Director Ellen Blair said councilors received full coverage and School Board members received partial coverage until 1995.
When asked why the city scrapped the plan, Blair said, “obviously, (for) the cost savings.”
Cumberland County human resource specialist Brian Morrision said full health-care coverage is offered to the three county commissioners, who also receive a more than $9,000 stipend. The county offers $5,380 to each commissioner and will pay an additional $150 a week for dependents and an additional $185 a week for a spouse.
Meanwhile Dimillo, who along with his wife took out nomination papers for an elected seat on the School Board last fall, but did not run, said he now intends to seek Councilor Maxine Beecher’s seat.
“Next year, when I replace Councilor Beecher, I will not take a penny,” he said. “A lot of councilors in the past worked on the council because they wanted the health care, not because they cared about the city.”

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