Towns meeting with LGC on insurance refunds

Town Administrator Pam Brenner said an effort to get a portion of the $53.4 million that the Local Government Center has been ordered to refund to municipalities is moving ahead slowly. But the N.H. Supreme Court has not yet responded to an appeal from Peterborough and 17 other towns that are no longer members of the LGC.

The LGC is a risk pool organization that provides health care and liability insurance to the municipalities and school districts that make up its membership. The LGC was ordered last year by the N.H Bureau of Securities Regulation to repay a portion of its surplus fund balance to members.

The LGC has appealed that ruling to the Supreme Court, although it agreed to return $22.5 million in surplus funds for 2012 to its members.

However, the LGC has proposed to issue refunds only to those towns or cities that were members of its health and property liability trusts as of Aug. 16, 2012, the date of the Bureau of Securities Regulation order. That would exclude Peterborough and other towns that left the LGC prior to that date from getting back any money. Other area towns impacted are Bennington, Greenfield, Lyndeborough and Temple.

Brenner said Peterborough, Durham and Salem are the three lead towns that filed a motion to intervene with the Supreme Court in an effort to be included in the settlement.

Brenner said the ruling by the Bureau of Securities Regulation, which is part of the Secretary of State’s Office, didn’t address the concerns of towns that had left the LGC. She also said the LGC has a new executive director, George Bald, and representatives of the towns have met with him.

“He is listening to our concerns,” Brenner said. “We are also continuing discussions with the Secretary of State’s Office. We have all three parties working on it.”

On Friday, Bald said in a phone interview that the LGC has about $33 million on hand that will be used to repay members once the issue with the towns that are seeking to intervene is resolved.

He said the order issued in August states that only municipalities or school districts that were members of the Health Trust risk pool after June 14, 2010, are eligible for refunds.

“The issue is that the order was very specific,” he said. “We’re making sure we do everything we can to do what the order says we are supposed to do.”

Bald, who is a former commissioner of the N.H. Department of Resources and Economic Development, is serving as LGC executive director on an interim basis.

He said the LGC’s Health Trust board last week voted to approve a 5.8 percent rate increase for next year.

“None of the increase in premiums is going to go to pay for the refunds,” Bald said.

No date has been set for the Supreme Court to consider the LGC’s appeal of the Bureau of Securities Regulation ruling, according to Bald.

He said the LGC had appealed the order to refund $53.4 million because board members didn’t agree that the fund balance was excessive.

“We thought it was prudent to have that much reserve,” Bald said.

He added that he hoped the dispute could be settled out of court.

“It would be my preference to resolve things without further litigation,” he said. “I hope we could come up with a way to withdraw the appeal.”

Dave Anderson can be reached at 924-7172, ext. 233 or danderson@ledgertranscript.com. He’s on Twitter at @DaveAndersonMLT.

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