South Portland seeks end to lawsuit over council health benefit

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SOUTH PORTLAND — A court filing by the city says there is no merit to a resident’s claim that the health insurance benefit offered to city councilors is illegal under the City Charter.

The city is asking a Maine Superior Court judge for summary judgment in its favor, plus monetary damages, attorney fees and other “reasonable costs” incurred to fight the claims made by Albert DiMillo Jr., of Colchester Street, in a Jan. 23 lawsuit.

DiMillo argues that receiving any benefit above the $3,000 stipend outlined in the charter is illegal, and has asked for all health care payments to be stopped. 

Article II Section 209 of the City Charter says “The annual compensation of the councilmen shall be $3,000.” Since 1977, councilors who opt in to the health insurance program have received benefits in addition to their $3,000 annual stipend.

Last year, the city paid more than $50,000 to insure four councilors. If all seven councilors took the benefit, the expense to the city would have been $99,000.

The city’s response to DiMillo’s suit, filed last week by attorney Sally Daggett, was a boilerplate denial of the allegations, suggesting there is no legal recourse for DiMillo, City Manager Jim Gailey said Wednesday.

“It may as well have been a stamp,” he said. 

Daggett did not return several phone calls for comment.

The city has been dogged by questions about the health insurance benefit for several years, with some residents asking the council to either end the benefit outright or put the issue to a public vote.

Gary Crosby, a South Portland resident, has gathered about 180 signatures on a petition to discontinue health care.

Critics have said the system creates inequity on the council; that rising premiums amount to an annual raise for councilors who take the benefit, and that it’s inappropriate for the council to decide its own compensation.

Three councilors – Maxine Beecher, Tom Blake and Tom Coward – receive city health insurance and have been the most strident defenders of the program.

At Wednesday’s City Council meeting, DiMillo told councilors he was confident he’d win the lawsuit and that Daggett has a conflict of interest in representing the city because she is paid every time she recommends the city fight a lawsuit.

“She represents the city, she tells the city to fight a lawsuit, and thereby hires herself,” he said. He told councilors that if Daggett thinks the city is right, she should offer only to take payment if she wins.

DiMillo, a retired accountant, also said that if he wins the lawsuit, he’ll try to make every councilor who took the health care benefit pay back taxes on the value of the “illegal” benefit they received from the city.

Gailey, city councilors and Daggett met in executive session to discuss the lawsuit Wednesday night. Maine law prevents reporters or members of the public from sitting on on such sessions; no vote or action was taken on the matter afterward.

Mayor Patti Smith, who has an opponent of the health insurance benefit, said the council will discuss the issue at a Feb. 27 workshop.

“I’m going to let (the workshop) occur and let the process do its thing, with the faith the process will work,” Smith said.

Mario Moretto can be reached at 781-3661 ext. 106 or Follow him on Twitter: @riocarmine.