Budget committee finds town pays more in benefits than staff realized; proposes 'right-sizing' health plan method

The Brentwood Budget Committee on Sept. 8 reviewed a compensation-ratio analysis and a detailed review of the towns health insurance setup, and proposed budgeting next year according to the language of the employee handbook to correct how the town has been calculating employer contributions.

The analysis presented to the committee found total-compensation ratios (salary plus employer-paid benefits and payroll taxes) ranging from about 1.59 to 2.24 in nine modeled scenarios and an average total-compensation factor of about 1.89. "An employee that earns $50,000 of salary, the true employer cost is usually between $65,000 and $70,000," the presenter said, citing Bureau of Labor Statistics guidance; using Brentwoods benefit assumptions, his example produced a total compensation of $97,118 for a $50,000 police-officer salary (a compensation ratio of about 1.94).

Why it matters: committee members and select board representatives said the current way the town has been applying its insurance-contribution policy appears to have shifted cost from employees to taxpayers for multiple years. The budget committee chair said the group will "work together to provide a unified budget that meets the town needs on behalf of everyone," and proposed that the 2026 operating-budget appropriation be calculated in line with the employee handbook rather than using the towns highest-cost plan as the basis for employer contributions.

Key facts and context

- Compensation findings: the presenter ran nine scenarios (varied salaries, years of service and coverage choices). Ratios ranged 1.59'2.24; average 1.89 (presenter). He said that BLS public-sector ratios typically run about 1.4—.6 and noted Brentwoods modeled results sit roughly 25% above that range.

- Retirement and payroll costs used in the models were those for 2025: Group 1 retirement employer rate 12.75%, fire 29.15%, police 30.95% (the presenter said those are 2025 rates). FICA for Group 1 was modeled at 7.65% (6.2% Social Security + 1.45% Medicare); police and fire pay only the 1.45% Medicare employer share.

- Health insurance appropriation: the towns 2025 health-insurance appropriation was cited as $596,674. Applying the employee-handbook method (town pays the handbooks stated contribution based on the handbooks middle plan) to the same enrollment snapshot produced an estimated appropriation of $502,099, a reduction of $94,575 (about 16%). The presenter said that difference arose because the town had been using its most expensive plan as the basis for the employer share instead of the handbooks middle plan.

Discussion and differing views

Committee members and the select board discussed approaches to address the discrepancy. Some members emphasized the need to correct the implementation and budget the line properly for 2026; others urged sensitivity to employees who had selected plans based on the towns prior practice and recommended transitional options.

Several operational suggestions came from HealthTrust and a benefits consultant the committee is engaging:

- Remove the very low-deductible (highest-cost) option from the employers preferred contribution base and instead offer a set of higher-deductible tiers (examples mentioned: $1,000, $3,000, $5,000) that reduce premiums while preserving options for employees. The committee was told private-sector employers have moved away from zero-deductible plans because of cost.

- Consider employer-funded FSAs or HRAs to help employees cover deductibles and out-of-pocket costs. One example the presenter repeated: the town could fund a modest HRA (for example, $500 to $1,500 depending on coverage tier) that carries over year to year for the employee. The committee noted the need to check set-up costs and administration details.

- Evaluate the feasibility and cost of moving from the HealthTrust self-insured pool to a direct-insurance arrangement (Anthem or similar). The committee said a benefits consultant who is a Brentwood resident is preparing a comparison but emphasized provider networks and continuity of care as critical constraints.

Public response and personnel context

Several residents spoke at length. One commenter, Jim Broglow of Scrabble Road, told the committee the community should focus on Brentwood-specific costs and said taxpayers have been generous in benefits. Another resident urged the committee not to phase in employee responsibilities for costs and to seek lower-cost plans instead. Select board Chair Paul Kleinman said the select board will put the issue on its agenda and consider transitional policies "to be fair to taxpayers and employees" once updated rates are available.

Next steps and timing

- HealthTrusts rates were reported as expected in early October (the presenter said Oct. 7 is a working target) and open enrollment typically follows in November with January 1 coverages.

- The budget committee and select board members agreed the committee should budget health insurance per the handbook for the FY2026 appropriation while continuing to develop mitigation scenarios for employees (for example, partial phasing or employer-funded HRAs) so the change is not unexpectedly punitive.

- The committee asked the finance director and benefits consultant to produce scenario tables using the new rates and to model phased contribution changes; the finance director provided a sample scenario that examines an intermediate 8% change for next year as a possible transitional approach.

Ending

Committee members said the review identified an implementation error that should be corrected and that they will work with the select board, the finance director and the towns benefits consultant to present clear options to employees and voters before finalizing the FY2026 health-insurance appropriation.