Grosse Pointe Shores retirees and supporters demonstrate against changes to their health care plan, including increased costs, outside City Hall July 21.

Grosse Pointe Shores retirees and supporters demonstrate against changes to their health care plan, including increased costs, outside City Hall July 21.

Photo by K. Michelle Moran

Grosse Pointe Shores retirees picket over increase in health care costs

By: K. Michelle Moran | Grosse Pointe Times | Published August 11, 2020


GROSSE POINTE SHORES — They may not have gotten the decision they’ve been seeking from the Grosse Pointe Shores City Council, but Shores municipal retirees did get a show of support from some Lake Shore Road motorists.

Roughly a dozen retirees, their spouses and a couple of supporters from neighboring public safety departments picketed in front of Shores City Hall on Lake Shore Road before the July 21 City Council meeting at Osius Park, calling for restoration of the retiree health care benefits that were changed by a vote of the council during a meeting by phone May 19. Some of the signs asked motorists to honk if they supported the retirees, and a number of drivers did just that, with some even pulling over to get additional information from the picketers about what happened.

Signs had messages such as “Grosse Pointe Shores Does Not Value Employees” and “GPS Honor Your Commitment.”

Retirees said they would have had even more marchers, but some of them are in their 80s and health issues, combined with fear of contracting COVID-19, are keeping them from joining. In total, the Shores has 35 current retirees, and eight of them qualified for a hardship provision that exempted them from the health care changes because their pension is below $31,225.

In June, retirees said they received word that the council voted 6-1 in May in favor of moving retirees to a health care plan in which they have to pay 20% of the costs, similar to the one current employees are on. City Councilman Douglas Kucyk cast the sole dissenting vote. The council majority noted that 60% of the Shores’ health care budget is for retiree health care. They say the city has an $11 million retiree health care liability, of which $9.2 million is unfunded.

Shores Finance Officer/Treasurer Rhonda Ricketts said altering retiree health care responsibilities will only save the city about $139,000 a year, $68,000 of which is from increasing their share of the costs to 20%.

The retirees not covered by the exemption say the increased health care costs are too high for them to bear and are in violation of the contracts they signed with the city while they were working. They also say they gave concessions in salary and other benefits during their working years in order to be guaranteed retiree health care.

Jim Cooke retired as the parks and recreation director in 2010, but he started working for the Shores in 1978 as a member of the Department of Public Works. A father of 13-year-old twin daughters, he said he had to drop his girls from his health insurance coverage and switch them to his wife’s plan, because he couldn’t afford the $380 a month it was going to cost him under the new program. He was one of the marchers on the picket line.

“It’s a shame that people who have dedicated their lives to this community have to come out here with picket signs for this,” Cooke said. “You have people who have risked their lives for this community.”

As a member of the DPW, Cooke said he spent 25 years as a Shores reserve firefighter.

Marcher Jim Demeulenaere, who retired as a lieutenant in the Public Safety Department in 2012, recalls the DPW workers helping them battle blazes. With the Shores being one of the most affluent cities in Michigan and being on seemingly solid financial footing — it has a AAA bond rating, the highest one possible, and that’s considered a measure of municipal financial strength — he and other retirees don’t understand why the council is asking for more money from its retirees.

“If it happens here, it can happen anywhere else,” Demeulenaere said. “It seemed like such a surprise.”

Mayor Ted Kedzierski said it all comes down to the rising cost of health care.

“At the beginning of the year, Rhonda presented a budget showing we were going to be short about $320,000 (in the 2020-21 fiscal year), and that didn’t include a fire truck that we needed,” Kedzierski said. “Our total city of Grosse Pointe Shores health care cost under covered contracts for 2019 was $795,000, and in 2018, it was $668,000, so health care costs have gone up considerably. So, what we did was very difficult, but our (health care) consultants … (recommended that) we essentially move the retirees to a plan designed to mirror what our active employees receive now.”

Elected officials also say the Shores is being forced to meet state requirements for retiree health care funding that were imposed circa 2017. Some other communities have met these requirements by moving funds from other retiree accounts into health care.

Public Safety Lt. Dave Younk, who retired in 2012 after nearly 30 years, said Kedzierski was on the council and approved at least some of the contracts current retirees were under. Kedzierski has served on the council since April 2009 and has been mayor since November 2011.

“He ratified those contracts, and now he went back on his promise,” said Younk of Kedzierski, who formerly served on the Shores Finance Committee.

Ricketts, who ultimately presented the city with a balanced budget, said in a letter read into the record at a June 16 council meeting that the Shores isn’t in dire financial straits.

“Communities that have had similar cost sharing/benefit changes in recent years are communities that were in financial crisis — Wayne County, city of Flint,” Ricketts’ letter reads, in part. “They were not AAA (bond) rated communities (like the Shores). Is it the City Council’s opinion that we are equivalent to these communities?

“Many communities that have been cited by the state of Michigan for underfunded status in their pension fund and/or OPEB (Other Post-Employment Benefits) funds have submitted corrective action plans (to the state) that do not include cost sharing and/or benefit reductions,” Ricketts’ letter continues. “The village of Grosse Pointe Shores has not been cited by the state of Michigan for underfunded status.”

Dr. Raymond Rahi, who said he’s lived in the Shores for nearly 30 years, spoke in support of the retirees during the July 21 council meeting. He called Shores personnel “the glue that binds this community together” and said the workers — who have shown great dedication and care to the residents — “mean more to me than dollars and cents on a piece of paper.”

“These agreements … were made in good faith with all of the parties involved,” Rahi said of the contracts. “I don’t like taxes, and I don’t like paying more, but what message does it send when you renege … on the agreements we made decades ago? … What message does it send to our children if our word has no meaning?”

Longtime Shores Planning Commission Chair Mary Matuja echoed Rahi’s sentiments.

“A promise made should be a promise kept,” Matuja told the council. “These people are like our (family). Why can’t we sit down with them … and go into the community and find funding (for retiree health care)?”

The retirees marched in front of City Hall for about an hour, stopping in time to head into the park to attend the council meeting, where they continued to voice their concerns.

“Maybe we can change the council’s mind,” Demeulenaere said before the July meeting. “For the amount of money they’re saving on an annual basis, I don’t think it’s worth the grief they’re causing.”

At press time, it appeared that the council was doubling down on its decision in May, but there also were signs that some elected officials want to study this issue again.

City Councilman Matthew Seely made a motion at the July 21 meeting essentially restating the council’s May 19 motion; it passed 6-1, with Kucyk voting against it.

Kucyk later made a motion to reconsider the council’s action on retiree health care in May, delay implementation of that action and refer the matter back to the Finance Committee to develop possible alternatives for the council’s consideration in September.

Kucyk, a member of the Finance Committee, voted in favor of this motion, as did fellow Finance Committee and council members Robert Barrette and Sandra Cavataio, the Finance Committee chair, but the motion failed when Seely, Kedzierski and council members John Seago and Danielle Gehlert voted against it.

“Some communities are dealing with (this issue) by moving money from one pocket to another,” Kedzierski said. “Is that a real solution? To me, it’s like a card game. … I would certainly be willing to personally meet with (the retirees). … Obviously, finances are the bottom line.”

Kedzierski said the vote to change retiree health care was “the toughest decision” he’d made since he was elected to the council.

“If it was so tough, why didn’t you sit down and talk with your retirees before you did that?” said Deanne Younk, wife of Dave Younk.

After the council voted against Kucyk’s motion, retirees in the audience shouted, “Shame on all of you,” at the council.

Brandi Collins, wife of DPW retiree Tom Collins, said that she was assured personally by city officials that the benefits would be there for her and her husband into their retirement. And she said she wasn’t alone — they made similar promises to other spouses of Shores employees, because they knew that the workers would be missing holidays and milestone events with family in order to do their jobs.

“They made promises specifically to me,” she said after the meeting. “They promised they’d take care of us.”

Officials insist this was a decision they didn’t want to make.

“We’re doing everything we can to be as fair and as accommodating as we possibly can for our retirees,” Seely said after the meeting. “This is a difficult decision. We’re trying to do the best we can as fiduciaries for our residents while meeting obligations for our retirees.”

The retirees say they’re going to continue to contest the council’s decision, and legal action is possible, as well. They’re expected to be at the next Shores City Council meeting, which at press time was slated to take place at 7 p.m. Aug. 18 at Osius Park.

“They think we’re going away,” Dave Younk said. “We’re not going anywhere.”