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Merrimac official recommends 3.5% COLA as insurance costs rise
Summary
The town administrator told the Select Board that retiree and other insurance costs are rising, OPEB is about 75% funded, and recommended a 3.5% cost-of-living adjustment for employees, an increase the administrator estimated would add about $60,000 to the omnibus budget.
The Town Administrator reported to the Merrimac Select Board on Oct. 28 that the town is facing across-the-board insurance increases, including retiree insurance, and recommended a 3.5% cost-of-living adjustment for employees for the coming budget cycle. The administrator estimated the COLA would increase the omnibus budget by about $60,000.
The administrator told the board that the town received no competing insurance bids and attributed that to the town's loss ratio; McLeod will attend a municipal roundtable on health insurance to seek more options. New growth is expected to be minimal in fiscal 2027, and the town's Other Post-Employment Benefits (OPEB) trust is roughly 75% funded, the administrator reported. The board moved to allow the chair to sign related documents; the motion passed unanimously.
Chairman Chris Manni also updated the board on Chapter 70 listening sessions, urging residents to contact state lawmakers with local impact information to improve Merrimac's representation in Boston and potential school funding outcomes. The board discussed upcoming union negotiations and noted that the Light Department's insurance split may affect bargaining.
Why it matters: a COLA and higher insurance costs affect labor negotiations, the operating budget and potential tax or service trade-offs. The administrator presented the recommendation as part of preliminary budget planning; the Select Board will weigh the recommendation alongside other budget drivers in coming weeks.
The board moved on to other agenda items after the administrator's report; no final budget vote occurred at the Oct. 28 meeting.
