Opinion Number ( 2007 )

Dear Mayor Curry:

As Mayor of the City of New Iberia ("the City"), you have requested an Attorney General's opinion regarding the City's payment of health insurance benefits to a former member of the Board of Trustees.

According to your request, the City of New Iberia is in the process of adopting a plan to provide benefits to retirees for the cost of their health insurance. This proposed plan, a copy of which you attached, will allow the City to pay "a specified percentage of the monthly premiums for eligible retirees." Your request states that a former member of the Board of Trustees currently maintains his health insurance through the City and pays the monthly premium at his own expense. You seek an opinion as to whether, under the proposed plan, the City will become responsible for paying the premiums on behalf of this former trustee.

Initially, we note that under La. R.S. 33:5151(B), a political subdivision may pay one hundred percent of the insurance premiums for its employees and elected officials. See Atty. Gen. Op. Nos. 92-547, 91-209, 90-106, 88-480. This office has further opined that the term "employee" includes a former employee now retired for purposes of using public funds to pay premiums for insurance coverage. Atty. Gen. Op. No. 90-131. Therefore, the prohibition against the donation of public funds in the Louisiana Constitution under Art. 7, Sec. 14 does not apply to the contribution of public funds to insurance programs for the benefit of public employees. Atty. Gen. Op. No. 94-448.

With regard to the former member of the Board of Trustees, whether he falls within the definition of "retiree" in Section I of your proposed plan will determine whether the City would become responsible for paying his premiums under the proposed plan. Section I provides:

Section I. The term "retiree" for this purpose of the City Retiree Health Insurance Plan is a City employee, a New Iberia City Court employee or an elected official of the City of New Iberia:

-Who has retired under the Louisiana Municipal Employees Retirement System, Louisiana Firefighters Retirement System, Louisiana Municipal Police Retirement System or the Louisiana State Employees Retirement System or an elected official who is eligible for retirement and

-Who has been employed continuously for the City for the immediate ten years to said retirement or has been approved for disability retirement or an elected official who is eligible for retirement and

-Who has been enrolled in the City hospitalization plan for the immediate two years prior to retirement.

If the trustee is a "retiree" under the above definition, the City cannot arbitrarily decide against including him in the proposed plan and would be required to pay the percentage of premiums for his health insurance specified in Section II of the plan. Our office lacks sufficient information to determine whether the particular trustee in question is a "retiree" entitled to certain benefits. The answer is a factual determination that must be made by the City based on the provisions of the proposed plan discussed above.

We trust this adequately responds to your request. However, if our office can be of further assistance, please do not hesitate to contact us.

Yours very truly,

CHARLES C. FOTI, JR. Attorney General

BY:__________________________ Lindsey K. Hunter Assistant Attorney General

CCF, Jr./LKH/crt