Staff writer

agillooly@observer-reporter.com

CANONSBURG - Canonsburg Manager Terry Hazlett said the borough expected health insurance premiums to be more costly this year, and budgeted for a 6 or 7 percent increase.

To his surprise and dismay, when the renewal letter came in the mail, the increase was closer to 40 percent, up more than $100,000 over last year.

"We certainly didn't prepare for that," he said. "I wanted to bring this up immediately.

Hazlett said 23 employees are covered by the plan, including public works, sewage and office workers. While these employees agreed to pay 1 percent of their annual salaries to offset the cost of coverage, they pay relatively few deductions or copays.

If the borough absorbs the cost, council has limited options on how to deal with the additional expense.

Hazlett said options are limited, and Councilman Rich Russo said three courses of action were likely.

Council could raise taxes, furlough employees or ask personnel if they would be willing to reopen the recently negotiated contract to discuss an increase in employee contributions.

"Let's be honest in public," he said.

The new premium goes into effect June 1, going from $261,000 last year to $364,000.

Hazlett said he would approach the union to determine if another type of insurance would be feasible, or if employees would be willing to contribute a higher percentage of their salaries toward their health-care costs.

He indicated that a possible reason for the increase was because the borough's workforce is "very mature."

Hazlett said Tuesday he intends to meet with employees next week so he could bring a recommendation to council by its June 2 meeting.

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