Council questions city’s change to ‘gross’ accounting in firefighter term‑life contract; finance committee moves item to council

The city’s personnel director and purchasing director defended a three‑year renewal of the municipal term‑life insurance contract at a finance committee meeting Wednesday while councilors pressed for clearer disclosure about how the city reports the cost.

Personnel Director Steven Rotondo told the committee the city had negotiated a three‑year rate freeze with Securian for basic and optional life benefits for active employees; the only increase the department could not freeze was for retired firefighters’ basic life insurance. "This is a three‑year freeze. Our rates aren’t going up," Rotondo said, characterizing the outcome of negotiations.

Change from net to gross presentation: The major point of contention arose from a change in how the administration presented the spending authority. Historically, the city had shown net costs in spending requests — the expected city outlay after reimbursements from retirees and employees who buy supplemental coverage. Purchasing Director Frances Gomez told councilors the purchasing division recommended showing the gross vendor amount to request spending authority, so the council would authorize the full sum the city might pay before reimbursements arrive. As Gomez explained: "Best practice is to ask the council for a spending authority. So we're asking for the council for the spending authority for 3 years…that's why I suggested to go with the gross so that way they are covered even if we get reimbursements that will show up later afterwards."

Numbers and the council reaction: Council members compared previously presented net numbers with the new gross figures and expressed confusion. Councilors said they had expected the budget presentation to match the net figures in the budget package. A councilor who reviewed the numbers said the previous three‑year award had been shown as $133,593 (net) and the new three‑year gross presentation totaled $369,333, and asked why the change had not been disclosed up front. Rotondo said the city expects to be fully reimbursed for retiree premiums — roughly $191,000 over the three‑year term — and that the gross presentation followed purchasing’s guidance.

Committee outcome and follow‑up: After lengthy questioning, the finance committee ultimately voted to move the item to the full council without a recommendation. Several councilors said they would prefer to hold the item for one meeting to review the contract language and the breakdown between gross and net budgeting; others pressed staff to provide clearer documentation showing what the city would actually pay net of reimbursements and how reimbursement flows are tracked in city accounts.

What the administration said it would do: Purchasing Director Gomez told the committee she would include clearer spending‑source statements in future bid packages and that the finance office was auditing the reimbursements and their accounting paths. Rotondo said the city had frozen the employer cost for the active population but could not freeze retiree payments, which are reimbursed by retirees themselves and vary with the retiree census.

Ending: The committee’s move to send the item to the floor without a recommendation leaves the decision to the full council; councilors requested clearer, line‑by‑line net vs. gross documentation and copies of relevant contract language for firefighter retiree reimbursements before a final decision.