Federation of Connecticut Taxpayer Organizations

Based upon Court Ruling on Anthem Stock distribution and Connecticut Education Association (CEA)� Press Release �� (http://www.cea.org/NewsDesk/newsrelease102204.htm), FCTO proposes the following�.

PRESS RELEASE

FCTO Proposes Changes to State Binding Arbitration Laws based on the Anthem Stock Lawsuit by Government Sector Unions!�

Eliminate HealthCare Costs and Issues from Contract Negotiations and� Arbitration!

The Federation of Connecticut Taxpayer Organizations, Inc. calls upon Governor Rell and all State Legislators to review the State�s Binding Arbitration Laws with the intention of eliminating taxpayer financed healthcare benefits from contract negotiations and arbitration.�� Between 70% to 90% of municipal budgets pay for personnel related expenses.� Taxpayers pay approximately 85% to 95% of healthcare costs for government sector employees.� Today, an average family policy for a union member costs approximately $15,000 annually.�� This equates to a cost to the taxpayer of approximately $12,750 to $14,250 for each union member�s healthcare policy.��

For years, Connecticut taxpayers had paid the full healthcare premiums for state and local government sector employees and their families.� On average, their quality of healthcare benefits has exceeded that of the private sector.�� Only within the past few years, have government sector unions begun to pay toward their premium.� The Anthem stock distribution encompassed a timeframe in which the majority of the premium costs were born exclusively by taxpayers.

Yet, the unions, with no concern for the number of uninsured or underinsured working taxpayers in Connecticut, want more and have gone to court to get it.� As a

result of their lawsuit to access the stock distribution by Anthem, they have forced taxpayers in the State and within individual towns to absorb the costs of litigation and arbitration.�� With many towns hiring outside legal counsel, it is now apparent that those costs will well exceed whatever the unions garner for their individual membership.��

State taxpayers pay approximately $300 million for State employee healthcare and $155 million for State retire healthcare.�� This is in addition to what taxpayers pay through their local property taxes for healthcare for their municipal employees.�

The Wall Street Journal recently wrote �According to the Bureau of Labor Statistics, Americans' average annual out-of-pocket expenses for health care rose 26% between 1995 and 2001, to $2,182. The Kaiser Family Foundation, a nonpartisan research group based in Menlo Park, Calif., that tracks healthcare spending, says that workers' average monthly contribution to premiums for family coverage alone more than tripled to $174 from $52 between 1988 and 2002. Copays for brand-name drugs that have generic equivalents jumped 62% to $26 last year from $16 in 2000, while generics rose to an average of $9 from $8, Kaiser says.�

As Connecticut private sector taxpayers are forced to absorb the increasing costs of healthcare through their own jobs, they are now expected to give even more to those working in the public sector.�

We look to our State elected officials to protect the taxpayers of our State and municipalities from the unreasonable demands of the public sector unions.� We ask that healthcare benefits not be a contract issue, and that the Binding Arbitration laws be revised accordingly.

In summary, Connecticut's policymakers must understand that:

� Public employees work for the taxpayers!

� State and municipal taxpayers financially fund union contracts and healthcare benefits!

� Many taxpayers are uninsured or underinsured!

� State and municipal taxpayers can no longer support the unreasonable demands of the public sector unions as illustrated by the position the unions have taken on the Anthem stock distribution!

Connecticut policymakers must therefore:

� Give financial relief to Connecticut and municipal taxpayers!

� Eliminate healthcare issues and funding� from contract negotiations and arbitration!