COUNCIL OF THE CITY OF PHILADELPHIA PUBLIC HEARING COMMITTEE ON LAW AND GOVERNMENT - - - Room 400, City Hall Philadelphia, Pennsylvania Thursday, 6/14/01 1:15 p.m. - - - RESOLUTION 000476 - Authorizing the Committee on Law and Government to investigate whether the City-administered health plan currently and in the past has provided the most comprehensive and cost-efficient coverage to City employees for the premiums paid, and whether the City Could provide more comprehensive and less costly coverage to the approximately 8,000 employees and retirees currently covered by this plan if other options were pursued. PRESENT: COUNCILMAN DAVID COHEN, Chair COUNCILMAN ANGEL L. ORTIZ, Vice Chair COUNCILWOMAN JANNIE L. BLACKWELL COUNCILMAN MICHAEL A. NUTTER COUNCILMAN FRANK RIZZO - - - VINCENT VARALLO ASSOCIATES, INC. Registered Professional Reporters Eleven Penn Center, Suite 600 Philadelphia, PA 19103 (215) 561-2220 2 6/14/01 LAW AND GOVERNMENT COMMITTEE I N D E X Thomas Lamb, Administrator. . . . . . . . . . Law Enforcement Health Benefits - Philadelphia FOP Lodge 5 Blue Cross Health and Welfare Fund Linda Berkowitz Deputy Secretary. . . . . . . 14 Financial Oversight Bob McAlister, Benefits Administrator . . . . 59 AFSCME District Council 47 Tom Cronin, District Council 47 . . . . . . . 61 Louise Simpson (position not identified). . . 65 3 6/14/01 LAW & GOV'T - BILL 000476 P R O C E E D I N G S
The Committee on Law and Government is resuming the recessed hearing from two days ago, and there is a continuing quorum since this is a recessed hearing. Now, before I call Miss Berkowitz, there has been handed to me a document saying 7,082 -- I assume that means people injured-on-duty occurrences between July 1993 and February 2000. I assume that's a report on the FOP, and I would like to ask the representative who presented this to the committee to come forward and just explain briefly to us what this is. (Witness comes forward.)
And Miss Berkowitz -- and thank all of you for your patience. The Committee also votes -- thinks that Councilman DiCicco is entitled to a vote of thanks because if he had not withdrawn consideration of two bills before the City Council today --
-- I think we would be in session till about 4, 5 o'clock, maybe midnight tonight. So we're very glad we're able to 4 6/14/01 LAW & GOV'T - BILL 000476 keep within general time limits. Sir, identify yourself for purposes of the record and then proceed.
Yes, sir, Mr. Chairman. My name is Thomas Lamb, L-A-M-B. I administer law enforcement health benefits, which is the Philadelphia FOP Lodge 5 Blue Cross Health and Welfare Fund. I testified on Monday of a great concern to our members about the City not assuming the financial responsibility for officers injured on duty and/or killed in the line of duty. As you know, in July of 1993 -- and that's why this goes back to that date. In July of 1993, the City of Philadelphia was successful in financially capping our medical contribution for the FOP members, but the at the same time, they did not assume the financial responsibility of officers that incurred medical claims for an on-the-job occurrence. So at the same time while the City was financially capping our contribution, they were in essence dumping medical claims into our usage, which equates to a higher Blue Cross premium, which is now having a serious, a financial effect on the FOP Blue Cross 5 6/14/01 LAW & GOV'T - BILL 000476 medical plan. This is an exhibit and I wanted to bring this to the committee because we have heard the same thing over the last seven contracts that you have been hearing for the last year. We're reviewing it, we're working on it. I was not aware of it. This exhibit was presented by the FOP in the 2000 contract negotiation, so no one from the City can say they were not aware of it or they're working on it. At that time, the City, under the discovery, produced injured-on-duty reports complete up to November of 1999, partial reports for December, January, and February. At that time, there were a little over 7,000 injured-on-duty occurrences. Currently, there's over 8,000 injured-on-duty occurrences. What I did to even make it even more dramatic, if you will, the next page is from our Website, the FOP Website, and we call it the FOP Honor Roll. Regretfully, these are officers that were killed in the line of duty. And you can see I put a little dot next to three names. Regretfully, the third name I have to leave the office and could not bring the claims that we paid. 6 6/14/01 LAW & GOV'T - BILL 000476 But if you look, the first officer that was recently killed in the line of duty, the top line of that is our Blue Cross paid claims tape, so every claim that we pay for police officers through the FOP, we receive a monthly paid claim statement. And for this officer, who was severely injured, critically injured, and was -- basically, the plug was pulled about three days after the injury was occurred, we were charged by Blue Cross to charge them out with $1700, and our fund with the Blue Cross discount was charged $400. The next example of the other officer -- he was killed on January 19, 1996. It was ruled injured on duty, and the City did contest this as an injured-on-duty occurrence. It eventually was ruled injured on duty, and you can see our fund paid over $5,000 for this officer killed in the line of duty. This is all part of the over 8,000 injured-on-duty claims that the City refuses to accept the financial responsibility for. If you carry that one step further, injured on duty we define as officer falls down the steps or gets involved in a fight and returns to duty within a reasonable amount of time. We define 7 6/14/01 LAW & GOV'T - BILL 000476 Worker's Compensation as an officer that cannot return to duty and perform the functions of a police officer. It usually goes to Worker's Comp. Board, it drags on for a couple of years. The officers have a choice to use the attorney of their choice, so if they choose to use an FOP attorney, that's fine, we would be aware of any favorable ruling. But if the officer chooses to use an independent attorney, we would have no 11 knowledge of that. So the only central point that we can identify Worker's Compensation awards in favor of the officer is the City of Philadelphia. They blatantly refused to give us any information on officers that have received favorable Worker's Compensation.
And just on this one officer -- of course, we picked one of the more extreme. Just on this one officer, there were $662,000 in claims that is City responsibility that our members paid for on a financially capped contribution from the City. It's just blatantly unfair. To even take it a step further, with the ones that I highlighted, when we eventually do resolve this with the City, and the only thing 8 6/14/01 LAW & GOV'T - BILL 000476 holding it up from what I understand from our attorney is the City signing the agreement to allow Blue Cross and Comp. services to sit in front of a computer, look at when the officer was injured, the type injury, and then look at the claims the officer incurred, and properly apply the responsibility where it lies. Well, one of the problems we have, if you look at this, and this was taken -- this is again an exhibit from our FOP contract presentation in the year 2000. If you are a Blue Cross reviewer and you look at number 2, the officer, the second on the list, the City listed his injury as a fracture. Well, if the Blue Cross reviewer goes into their computer and sees the injured-on-duty occurrence was a fracture and in reality it was death by auto accident. And I did just a few more. Laceration and puncture: It was a gunshot. Concussion: Fell down the steps, struck their head and died. Contusion: It was nine knee operations by non-board certified City doctors. Laceration and puncture: It was a 9 6/14/01 LAW & GOV'T - BILL 000476 gunshot that almost blew out all of his teeth and involved dental implants. The problem with this terminology is when you go in and evaluate the injury and the claims incurred, it becomes awful difficult to tie in a laceration to an auto accident and a death. The Blue Cross person may say, Oh, maybe they went to the doctor in the morning and went to work on the 3-to-12 shift and was involved in an accident and died. So it's very, very confusing, to be fair. The last thing -- well, two things, if the Chairman doesn't mind. Our members regretfully are involved in circumstances -- depending on the circumstances and depending on the individual officer, we do experience posttraumatic stress or some emotional problems caused by what human beings do to other human beings out there. The City of Philadelphia blatantly refuses to recognize any emotional problems caused by an on-the-job occurrence. I have documentation in here where we had requested from the City of Philadelphia if an officer has an emotional problem from a job occurrence and goes to our employee assistance unit, 10 6/14/01 LAW & GOV'T - BILL 000476 the EAP Unit, which is staffed by police officers, I asked for documentation. If the police officer working the EAP Unit feels the officer that has the emotional problem needs a more professional level of care, what are their instructions? Their instructions are in here and what it basically says is send 'em to the FOP Personal Choice Program because we have nothing.
Well, Mr. Lamb, I don't want to interrupt that, but this committee is not going to be able at this hearing level to deal specifically with those items that you're referring to, but I would hope that during the summer, you will be in touch with our staff so they can get all of the information and see to what extent it's related and to what extent we in Council can give you and your organization assistance in resolving these matters with the City. We're very concerned about it and we think the documentation you presented to us is very important. As a matter of fact, it played a role in a matter that was before City Council, and I think City Council is growing increasingly sensitive as a result of the unfair way in which many members of 11 6/14/01 LAW & GOV'T - BILL 000476 Council feel that firefighters have been treated on hepatitis C. There had been a motion to table on one bill today certain parking revenue aspects for the stadium, and the reason the motion to table was taken was to attempt to put pressure on the City. It came within one vote of passing City Council, so that the efforts of the --
Well, Councilman Ortiz would want to claim that at one moment, it had passed, but then one Councilmember changed his vote. And by 9 to 8, the motion failed. What's important is merely that Councilmembers are exceedingly aware, whichever way they voted on the item, they are getting very conscious of the importance of finding a way to make the City deal fairly with the employee representatives on all the health and medical matters. So you're all making progress, but you've got to help us during the summertime by making information available. I want to note the presence of the 12 6/14/01 LAW & GOV'T - BILL 000476 committee. To my far right is Councilman Nutter.
We're not talking politically, right? And to sort of my immediate right is Councilwoman Blackwell, the Majority Leader, and two staff members, Stanley Shapiro, and Shoshana Bricklin and myself, David Cohen, as Chairman of the committee. And to my left -- not really, but to my left are Councilman Angel Ortiz and Councilman Rizzo.
Councilman Ortiz's to my left, okay. It's comfortable to not be all the way on the left by myself. But we are very conscious of the problems you face and very conscious of our needs, but I wanted the record to disclose the reference to this because this will be an exhibit, and we will note that by now, the number would be over 8,000. And the other questions that you raised are very important, but I think they first have to 13 6/14/01 LAW & GOV'T - BILL 000476 go through our staff members so we can group them, analyze them, and see where they fit into our hearing schedule. We thank you for your testimony. Does anybody have any questions of Mr. Lamb?
Could you please clarify for the record that this number is sworn officers and does not include any civilian personnel from the Police Department. Could you just be clear on exactly what these numbers represent, please?
Yes, sir. Yes, sir, Councilman Rizzo. That is from the active -- every occurrence was an active police officer during the performance of their job. It has nothing to do with other union members; it's only police officers.
Councilman Cohen and the rest of the committee, it's a great relief to me and the FOP that there is someone in the City that cares and 14 6/14/01 LAW & GOV'T - BILL 000476 is very concerned about fairness. And we greatly appreciate it. Thank you very much.
Miss Berkowitz, we're going to ask you to come forward so that we may find the status of -- on a number of items that were requested by the committee. (Witness comes forward.)
Is there any additional documentation that you are prepared to present to the committee today?
Good afternoon, Councilman Cohen and members of the committee. I'm Linda Berkowitz, Deputy Secretary of Financial Oversight. I have been asked to come back and report on two items. Specifically one is the status of the IOD issue just discussed by Mr. Lamb, and the second was a request for a list of retirees and addresses.
And really a third on which it's going to be continuing until we get a 15 6/14/01 LAW & GOV'T - BILL 000476 definitive answer, and that is on any plan which would establish the City's contention that unifying all of the health plans would be economical and more efficient -- more economical and more efficient than as they are being run today particularly by the four employee groups and the City, which is the fifth group.
I understand, and I cannot add anything more today than I said Tuesday or last week.
With respect to the two issues that you specifically requested, I come back and talk about them today. One, let me start with the IOD.
Well, let me tell you why it's so important for you to try to determine 16 6/14/01 LAW & GOV'T - BILL 000476 whether there ever was a plan because you may put the committee in a position where we will have no 4 alternative ever to conclude anything other than that there never was a plan and that, therefore, there was great impropriety in the bargaining process if there was a contention by the City that it had a plan when, in fact, there was no plan. And that's the reason I'm persistent. I'm hoping that you're going to be able to give us evidence that there was a plan and show us what it was. Otherwise, we're going to have to conclude that there was a fraud and a deception practice during the bargaining by the City. And that's a conclusion, I'm loath to reach, but if you don't offer us any opportunity for any other conclusion, that's the one we're going to have to reach. So that's the reason for my persistence. It's in my interest to try to establish that the City acted in good faith, and that's the reason we raise these questions. So I leave it to you. That's why we're persistent. Now, as to the two matters -- oh, Councilman Nutter.
Thank you, 17 6/14/01 LAW & GOV'T - BILL 000476 Mr. Chairman. First, I believe in the series of hearings there have been about this particular issue, I believe that I missed the last hearing, which may have taken place in the past couple days, and I was somewhere here in the building attending to other Council business. I apologize for missing that particular hearing, although I will be reading the notes of testimony. I was slightly confused, and Mr. Chairman, with your indulgence, I would like to go back to this issue. I thought I remembered back at contract time, there was discussion or at least a news at least a news account, if not a pronouncement, somewhere in mid-June of 2000 -- the contract expired June 30, I believe.
And discussions went beyond the contract time, but I thought the City did announce at that time that one of the items that was being pursued in this particular contract negotiation -- I think it was for a nonunion formed workers, initially DC 47, DC 33 -- the idea of everyone being in the same health care plan and that 18 6/14/01 LAW & GOV'T - BILL 000476 there would potentially be certain savings as a result of, quote/unquote, a consolidation of health-care services. Now, is that correct? Do you have any recollection of a report back at that time?
Okay. And can you share with me how that came about? Or what was the proposal at that time?
I really can't. I came into the labor negotiations very late, I did not enter into them until June. And what I have stated on the record --
And that's about the time that the proposal was made, right?
Well, what I stated on 19 6/14/01 LAW & GOV'T - BILL 000476 the record last week and this week is that I have never seen a comprehensive plan for consolidation. There was the issue of consolidation was discussed.
I was actually not in the rooms when the plan was discussed. I do not have information on consolidation, Councilman Nutter.
I can't tell you; I don't know who was in the room. I'm assuming that the City's official labor negotiation teams, the 20 6/14/01 LAW & GOV'T - BILL 000476 corps of the team, was in the room.
I believe that -- from what I understand, the idea was that through consolidation, there would be potential savings in terms of the overall cost of health coverage.
Councilman Nutter, would you yield for a moment on that last question?
Wasn't there in fact discussion about a study that had been made by the City which revealed there would be at least $18 million in savings?
Wasn't there that specific discussion? 21 6/14/01 LAW & GOV'T - BILL 000476
I can only repeat what I have already said. I am not prevaricating. I am telling you that I have never seen a comprehensive plan for consolidation.
There may have been -- were number of times, it's my understanding, discussed. I do not -- if I knew what those numbers were then, I do not recall what they are now. It has been a year.
Well, someone must have told you these things at some point in time.
I was told -- I was aware of it from discussions from the corps of the City's labor negotiation team.
Those were the City's outside counsel, the City's Office of Labor Relations.
I'm sorry. As you well know, I've never been a party to a contract negotiation, so I actually don't know -- who are these --
Bill Graub is the Director of the Office of Labor Relations.
Mm-hmm. And which one of them discussed this with you?
General or specific? I didn't ask which one, just -- 23 6/14/01 LAW & GOV'T - BILL 000476
Yes. There were not general discussions with me personally; there were general discussions among the City's labor negotiating team.
What was actually discussed with union leadership I cannot describe that.
Well, I'm not asking you to discuss what was discussed with union leadership. You're -- now, you've held a number of positions in the government; is that correct?
Okay. And in the past, you were, I think, in the Office of Management and Productivity? 24 6/14/01 LAW & GOV'T - BILL 000476
Okay. When you have an initiative in that particular office or in your new office that will have far-reaching or long-term effects, is it something that usually comes as a result of a series of discussions of a wide variety of people? is it something that requires a fair amount of study and data-gathering? How would you go about implementing a new policy in the City?
And I understand what all of the assumptions underlying the numbers are.
So based on that, if you were in a discussion with someone about this kind of concept, you would then naturally ask them 25 6/14/01 LAW & GOV'T - BILL 000476 what is the concept based on, right?
Okay. Did you as anyone what the source of these numbers or discussions were?
I just can only tell you that I have never seen anything that would meet my test of comprehensiveness, and that is what I have testified to here.
Well, I understand that. And, again, thank you, Mr. Chairman. My experience is, in this kind of discussion, if a person utilizes a particular term on a number of occasions, it must have significance and meaning, and so you have said to us now on at least three different occasions that you have not seen a comprehensive plan, which then would generate the question, if you had seen a comprehensive plan, where is the plan? Therefore, what did you see that was less than your test of a comprehensive plan? Did 6/14/01 LAW & GOV'T - BILL 000476 you ever see a document?
The document was estimated savings; I do not recall what those estimated savings were. The document was estimated savings. And at the time, I did request additional information in terms of assumptions.
I believe it was an outside consultant, and I do not recall their name.
Did I ever have that document? 27 6/14/01 LAW & GOV'T - BILL 000476
I don't know that they would not give me a copy. I did not have a copy.
Okay. You made a request for additional information; what happened to that request?
Someone -- now, wait a minute. At the time, what was your position?
Well, at the time, I was 28 6/14/01 LAW & GOV'T - BILL 000476 the City's Budget Director.
Okay. So let me try to understand this. The City's Budget Director, in the midst of contract negotiations, asks a person, or persons, for additional information that is directly related to the contract negotiation, and your testimony here today is that that information was not forthcoming at the request of the Budget Director?
And why would some refuse to give the Budget Director Information?
I don't believe it was that they refused to give it, and I do not wish to convey that perception. They did not refuse to give it. As I think the union membership would attest to, contract -- and it was my first time in contract negotiations as well. It seemed that you were going all of the time, and proposals were being put on the table and proposals were being taken off the table.
Well, from what I've heard, that seems to be the nature of the contract 29 6/14/01 LAW & GOV'T - BILL 000476 negotiation.
My last question, Mr. Chairman, is, of whom, Miss Berkowitz, did you make this request?
I believe I may have made that request of one of our outside labor counsel.
Okay. The document that you saw, you're saying that you never had a copy for yourself?
Have you seen a copy since the negotiations concluded?
So the document has disappeared? 30 6/14/01 LAW & GOV'T - BILL 000476
The document has -- I -- the fact that I don't have it does not mean that the document has disappeared, Councilman.
I would assume that Mark Foley still has a copy of the document.
Could I follow up on that? And I assume that when you made the proposal, you had the union numbers; is that correct?
When there was proposal for consolidation and you were gathering this theoretical aspect, you had numbers from 43 and the FOP and the firefighters and District 33 in terms of how their health plan operated and the finances of it and how much they spent per individual and so on for administration. You had those number, didn't you? 31 6/14/01 LAW & GOV'T - BILL 000476
I can't say that we had those numbers. In fact, it is my understanding that the City has had a great deal of difficulty in obtaining numbers on specific union health plans. We know what we give them in the way of contributions. And in fact -- in fact, I did see a letter yesterday, a copy of a letter that went from Independence Blue Cross to Mr. Cronin, President of DC Council 47 --
I remember. -- pursuant to a request made by the City's personnel director for information from IBC about their rates, and the letter states that he was -- the individual from IBC was awaiting instruction from Mr. Cronin, because in the past, IBC had specifically been prohibited from sharing that information outside of DC 47. And I would be very happy to get members of the committee a copy of that letter if they would like that.
I would appreciate having that copy of that letter. 32 6/14/01 LAW & GOV'T - BILL 000476 In one of the previous negotiations, didn't the City get a concession from the unions to have a City representative on the boards?
Councilman, I really am not here to discuss -- I mean, this is really beyond my bailiwick is discussing the terms and conditions of the City's labor contracts.
I'm just saying -- I'm just saying we're trying to find out how these numbers come about and -- because actually, we're involved. We come under a health plan and we come under the health plan that you have negotiated, and we have some problems in terms of what occurs and doesn't occur. What I just want to know is how it came about. Michael Nutter was asking some questions, and I just want to know how you created the numbers that you were then proposing, because you must have had numbers from the unions because you have members of the City who sit on the union boards, so you know how much they spend. They don't have members on the City side. So I'm just trying to gather how the process worked. That's all. 33 6/14/01 LAW & GOV'T - BILL 000476
Councilman, again, I can only say that it's my understanding that an outside consultant put those numbers together. I do not know the source of those numbers, I do not know the numbers that were used.
I do not know -- I knew the name of the consultant; I do not recall the name of the consultant.
Miss Berkowitz, procedurally, I'm a little mystified. You know, you are not limited by this committee to find out information. You say in reply to an earlier question from Councilman Nutter that Mark Foley had a document -- and you believe he still has it -- that pertains to the plan or savings under a plan or something. Have you asked him for it?
Councilman Cohen, I think Joyce Wilkerson and I both testified last week that I have been asked to do a complete review of all of the issues raised by this committee last year, in March, and again at this time. That review is not done. I do not -- 34 6/14/01 LAW & GOV'T - BILL 000476
Well, we don't intend to wait until you decide that you have finished that review.
Well, did you collect -- we've raised questions about a plan or a document or something.
Have you made efforts to locate if you yourself don't have it?
I have made efforts to collect all information that pertains to the issues raised by this committee last June, in March, and now. As we -- as we testified last week, the documentation regarding the City's -- the City-administered plan is poor.
How does that relate, say, to the question I asked you, did you ask 35 6/14/01 LAW & GOV'T - BILL 000476 Mr. Foley if he still has a copy and would he give it to you because the committee has asked for it?
I actually do have a job, Councilman Cohen. I'm sure you can understand that.
I would like to suggest it might be the most important part of your job.
Councilman Cohen, I think all of the issued raised by Council I take -- 36 6/14/01 LAW & GOV'T - BILL 000476 are serious and I take them seriously. I cannot provide instant gratification. I dot not have a lot of the documents, I don't know what is in a lot of documents, I don't even know the universe of documents. I am attempting to find out everything I can about all of the documentation pertaining to every issue raised by this committee last June, in March, and now. I cannot tell you anything else. If --
I cannot tell you anything other than what I have already said because that --
The Mayor has never forbidden me to speak fully and honestly, and if a 37 6/14/01 LAW & GOV'T - BILL 000476 mayor forbade me to speak honestly and fully, I would not be able to work for that individual.
-- or taking steps to answer them? Because what you are telling us, as I understand it, is that until you complete your full study and get all of the documentation, which may take us into the year 2200, that until then, you can't speak about anything. And that makes absolutely no sense to me. I learned in my first job that the first thing you did was when the employer asked you for something, your immediate supervisor, you got that and you didn't wait until you could come in and answer every question in the universe, but if he asked for specific information, you went out quickly and got that. We've been asking about the savings plan that was allegedly presented during the union negotiations, and I can't understand -- it's now several weeks since we first raised that with you. Why haven't you made real efforts to see whether you 38 6/14/01 LAW & GOV'T - BILL 000476 can give us a complete answer, that maybe there was no full-fledged plan, but there was a document which talked about savings. You didn't have all of the information then, you can't remember it all now, but you went out and tried to locate it physically so that you'd be in a position to present it to us. I can't understand why you're not doing that, why you keep answering -- you explained to us previously that you've been assigned this great job of producing documentation to all of the questions we have. We'd like answers to the questions we've now asked. We're not asking for the millennium and for you to present all of the documentation because that may take us a long time. Why don't you deal with what we asked you? Councilman Nutter's questions were very specific and direct.
Councilman Cohen, I have nothing to add. I have nothing to add other than what I have already said. You can ask me the question, you can share your frustration, you can share your anger. I have nothing to add to that today. 39 6/14/01 LAW & GOV'T - BILL 000476
Absolutely not, sir. Absolutely, I am not defying -- I respect the work of this committee, I respect the role that you have, I respect your need for due diligence, and I respect you personally. I am not defying this committee. I am attempting to gather all of the information and I have --
And you're not going to be able to discuss any of the information until you gather it all?
I cannot discuss anything I do not have in my possession. I am prepared to try and discuss the reams of material that we sent over to your office last week and this week. And I have sent much that over without having taken the opportunity to read it before it came, because when I received it, I had it duplicated and sent over to you because I am attempting to be responsive.
One of your responses was that you have a job. Could you please tell me 40 6/14/01 LAW & GOV'T - BILL 000476 if it would be helpful if this committee would write a letter to the Mayor getting you some help? It sounds like you need some help to get the information that we need. Are you just not able physically to gather the information? And I would ask the Chairman that if that is the case, that if you need some assistance since this, according to you, is a very serious issue, if your staff won't permit -- your staffing level won't permit you to respond as quickly as this committee needs the information, do you need some help?
Then what's the problem? If you say you have other things to do, then --
Councilman Rizzo, I have asked -- as I said, I have just recently gotten into the entire issue of the City-administered health plan. I have had no documentation of my own. I have requested documentation from sources in the government such as the Personnel Department and the Law Department to provide me whatever documents they have. And as I have been able to receive those 41 6/14/01 LAW & GOV'T - BILL 000476 documents, you have also received copies of them when you first became involved in this process as a seasoned executive.
When you realized that you didn't have the information that you needed to understand this new role that you were undertaking, did you ask anybody to -- did you need this committee to ask you for information that you -- it sounds to me that you need to do your job. You indicated that you wouldn't work for someone that asked you to do something that was wrong or not truthful.
But it sounds like you're working for someone that's keeps you in the dark.
No one is keeping me in the dark, I do not work for anyone who keeps me in the dark.
We have said that the documentation on the City-administered health plan has been poor. That documentation has not been kept 42 6/14/01 LAW & GOV'T - BILL 000476 by the people to whom I am directly accountable. It has been kept by others in the government. I am not here to criticize them either. But the documentation, the record-keeping has been exceptionally poor. It may be among the poorest I have ever experienced.
I don't know whether it exists. Do I believe that some of it exists? Probably. But without going personally through every file cabinet in every office that may have ever touched the City-administered health plan, I can't tell you what the universe of documentation is. And that is as -- if you can accept this, it is as frustrating to me at this point as it is to you. And perhaps more so to me because I have to come here and be the recipient of your frustration and your dismay at not being able to produce the documents.
Did you -- what 43 6/14/01 LAW & GOV'T - BILL 000476 happened when you -- with respect to the list of retirees with their names and addresses that we asked you to produce?
I have spoken with the Executive Director of the Board of Retirement and Pensions, who has advised me that that information is not public information, but that the Board would be happy to try and help Council in any way it could if it understood what it wanted with that list, and perhaps it could be the conduit -- if Council wanted to get information to retirees, it could be the conduit for doing that, but that that information is not public information. Those retirees are not public employees and their addresses are not public information.
How could that not be public information? 44 6/14/01 LAW & GOV'T - BILL 000476
It is my understanding that that is not public information and that retirees believe that where they reside is private.
You mean that the Pension Board is saying to City Council that it has the right to censor the material made available to City Council?
I have been advised by the Executive Director of the Pension Board that that information is not public information.
And what has that got to do at all with the question of furnishing that information to City Council committees?
I was advised by the Executive Director of the Pension Board that the list of retirees with addresses is not available, but that if the City Council -- if this committee wishes to make a request to the Pension Board, the Pension Board will consider it.
Well, that's really a very interesting statement you're making. You're saying the Pension Board says it is free to decide whether or not it wants to comply with a request 45 6/14/01 LAW & GOV'T - BILL 000476 from City Council, but it will honor us by saying if we make the request directly to them, they will consider it?
Councilman, I am not an attorney, I cannot validate the Pension Board's policy of privacy. And you might want, number one, to make a request to the Pension Board; and number two, to talk with the City Solicitor, who is also available to City Council, because I believe that the determinations of what is public information and what is available and to whom it is available is determined by the City's Law Department.
You know, I just get a sense, Miss Berkowitz, that despite the statements you've made to the contrary attempting to indicate that you are a self-assured, independent person who demands integrity from your employers so that you can do your work properly and honestly and fully, I just have a feeling that all that's happening that walls are being built up to prevent us from getting the material we need to perform our work. I'm getting a very uncomfortable feeling about that, Miss Berkowitz. 46 6/14/01 LAW & GOV'T - BILL 000476 And it may be that we're going to have to deal on the basis of legal subpoenas that are enforceable in courts because I just have a sense that you are determined not to make available to us any information. You keep telling us you haven't made your study. We're not now on the first day of questioning, we're not now on the first day of your assignment. It seems to me that everything we've asked for could have been obtained if there were really an effort to get it on your part. I think that somehow or another, you are not making a good-faith effort to provide us with the material. I want you to know that I'm getting very concerned about every obstacle being placed in our way to get information that We need to do our work. So you're telling us that you accepted -- did you notify me that you were rejected by the Pension Board?
I had a discussion with Mr. Herkness yesterday, and no, I did not. And I apologize for that.
You know there was another contention that was made by the City to the effect that the employment of a broker had produced 47 6/14/01 LAW & GOV'T - BILL 000476 millions of dollars in savings to the City. Have you been able to determine any documentation which either supports or refutes or does either in part of that contention?
Other than what the Rendell administration published in its five-year financial plans beginning in 1993, no, I have not had the opportunity to do that.
And what facts did the Rendell administration state in that five-year plan?
Councilman, if you will recall, I cannot give you the numbers, but if you will recall, one of the first initiatives in the Rendell administration was to reduce the health and welfare benefit costs to the City.
Well, they did that by increasing co-pays and making the employees pay a greater percentage of costs. They did it by introducing all kinds of deductibles.
Now, if that is the definition of efficiency, that would be very interesting. 48 6/14/01 LAW & GOV'T - BILL 000476
That was laid out for Council over the course of a number of years. I think the members of Council were -- including members of this committee, were fully aware of all of that information at that time, as were the unions. They were all public documents.
Well, what are you referring to as -- what was the public documents?
I don't know what you moan that they were all laid out. You mean the thinking of City was laid out or the policy when the City was --
The savings to the general fund of the health and welfare benefit reforms.
I have no 20 understanding of what that means in any sense at all. I've never known the City to openly discuss with anybody anything other than the terms of the current health plan, whatever year they were talking about.
I never heard them explain in advance that they had various proposals that they were going to make and, therefore, they were interested in the reactions.
Councilman Cohen, we were talking about savings. I believe that the issue that I was asked to address was savings, and what I have said to you is, I have not gone back and calculated them, but those savings were discussed and reflected both in the City's five-year financial plans beginning in 1993 as well as in the operating budgets passed by this Council.
Well, this committee has the right to ask an Administration representative to answer a question and not to refer the committee to other documentation --
So I'm asking you for the answers to the questions on savings.
Councilman Cohen, there 50 6/14/01 LAW & GOV'T - BILL 000476 were a number of requests for information made by Council in a letter dated June 4th to Joyce Wilkerson. I have attempted to put together responses to each of those information requests. We have made it very clear that we are not through in doing that. We said that last week. We -- I don't know what else -- I don't know at this point what I can tell you that I have not already told you. You've raised a number of issues --
Well, tell us one thing: Are you going to try to get information or are you going to continue to avoid trying to get information?
Well, then why haven't you been in touch with Mr. Foley to find out whether he has this document or not?
What is required to have an opportunity to do that? You mean you don't have a telephone or you don't know his phone 51 6/14/01 LAW & GOV'T - BILL 000476 number? What's so difficult about putting in a call to somebody who receives payments from the City of Philadelphia to say you are requesting certain information from him? Or do you lack authority to deal with him; do you have to go to someone else?
Councilman Cohen, this committee asked for a great deal of information. And as I have had the opportunity to obtain that information, Council has received it.
What defines your ability to obtain information? What do you mean, as you have the opportunity? I would think that's your number-one job.
Councilman Cohen, I don't know what it is you want to hear from me. If you-- I don't know what I --
What we're asking you -- I can't understand why you haven't called Mark Foley and asked for information.
I have a vague 52 6/14/01 LAW & GOV'T - BILL 000476 recollection that at one time you had a document and --
I have not finished gathering the information. And that is all I can say on the subject.
That means I have not finished gathering all of the information.
We're not asking you to wait until you gather all of the information. We're asking you sometimes for pieces of information, and one is documentation of some kind or a clear unequivocal statement that there is no 16 documentation. (Ms. Simpson approaches witness, offering cell phone.)
Here, call him now, right now. Why can't she call him right now.
Miss Simpson, please. (Ms. Simpson leaves cell phone on witness table.)
Councilman Cohen, I'm going to say this with all due respect to the committee. I have sat here last week and this week and been verbally assaulted at this table. If that continues, I will respectfully stand away from the witness stand until it is over.
I would like that individual to come and get her telephone, and I would like -- I would respectfully request that we proceed with some decorum and civility.
I'm going to recess 54 6/14/01 LAW & GOV'T - BILL 000476 this hearing at this point until this -- well, I will hold the recess till later, but I will recess that portion involving the witness. I'm going to ask that this Tuesday, at noon, in this chambers, that you appear and give us a specific response with respect to what you have been able to find out about any studies, documentation, any plans, or anything relating to studies of savings that would be made by unification and consolidation of plans, whether there was -- and to produce whatever basis at all of the existence of any kind of a sketch of a framework of a plan or a thought or an idea, and to pursue every necessary means to contact people whom you believe might have information if you don't have it or if there's no 17 other documentation that you can locate in the files. I just have a feeling that this committee is not being dealt with properly by the witness. And, therefore, maybe to clarify issues in my own mind, I would like to give you the opportunity to produce whatever you can, showing that you've made a genuine effort to obtain information for the committee, anything related to 55 6/14/01 LAW & GOV'T - BILL 000476 savings, anything showing how it was arrived at -- the conclusion was arrived at that consolidation would be in the interest, whatever support exists anywhere. And I'm asking you to do it 'cause you're presented by the Administration, and that doesn't mean that you personally have to have the information, but I believe if the Administration presents you as its premier witness, it is saying that you have the authority to do whatever is necessary to get that information. So, Miss Berkowitz, I'm going to ask that you -- I'm going to tell you you're free to leave the witness stand but to be here this coming Tuesday at the noon hour here in the main chambers. We're going to be recessing after one or two other witnesses testify.
But there's no sense just engaging in a fencing match in which it's clear to me at this point -- at least it seems clear to me -- that you are doing everything in an effort to see that we don't get information that we are entitled to have. 56 6/14/01 LAW & GOV'T - BILL 000476
Yes. There will be a public hearing here at noon this coming Tuesday, June the 18th, 19th? June the 19th. Is that Tuesday? Could somebody check the calendar?
If there is a public hearing on Tuesday, the 19th, I will be here.
Thank you. Now, who was indicating they wished to testify? (Witnesses come forward.)
And at that time, 57 6/14/01 LAW & GOV'T - BILL 000476 Miss Berkowitz, we're going to be asking you also on the question we have not asked you about today and that is your response to Mr. Lamb's --
As I indicated to you on Tuesday, Mr. -- it was -- this was the first I was made aware of the issue. I do not have benefit of any of the information that Mr. Lamb has given the committee today, but --
Would the Sergeant-at-Arms take it from Mr. Lamb and then 58 6/14/01 LAW & GOV'T - BILL 000476 present it to Miss Berkowitz.
No, please give the information to the Sergeant-at-Arms, and will the Sergeant-at-Arms present it to Miss Berkowitz.
Thank you. -- that if, in fact, Mr. Lamb was correct and a suit had been filed against the City concerning this issue, that I would not be able to discuss it because it is in litigation. It is my understanding that this issue is in litigation, although I firmly believe that the City would like to settle it amicably, but I am not permitted to discuss something under litigation.
All right, we'll accept that answer for the time being. And you do confirm the fact that there is the litigation --
And that it basically contains -- it deals with the kind of allegations 59 6/14/01 LAW & GOV'T - BILL 000476 that Mr. Lamb stated it does.
It deals with the issue -- I would not use the term "allegation," but it deals with the issue that Mr. Lamb raised on Tuesday and discussed here again today.
All right. I know the City has a policy -- the Law Department has a policy generally of not wishing to discuss publicly matters under litigation. We'll take that up if we think it appropriate with the Law Department.
Bob McAlister, the Benefits Administrator for AFSCME District Council 47.
I'm sorry, I'm unable to hear you. Please speak right into the microphone.
I'm Bob McAlister, the 60 6/14/01 LAW & GOV'T - BILL 000476 Benefits Administrator for AFSME District Council 47. Is it on?
I think it's important here that I respond to some of the City's testimony presented here today. Miss Berkowitz testified that the City of Philadelphia did not know what our medical rates were. Since 1992, the City of Philadelphia has had a trustee on our board. That trustee knows all of the rates that we pay. They know the rate that we pay for our Personal Choice product, our Keystone product, our dental, our prescription and vision. So the City of Philadelphia has known, since they have a trustee sitting on our board, everything that we pay for our medical benefits. In addition to that, each and every year, a certified audit is given to the City representative on that board that shows how all of our health care dollars have been spent. So for the City Administration to sit here today at this meeting and say that they did not know what our medical rates were is completely false. 61 6/14/01 LAW & GOV'T - BILL 000476
One is -- I just have a very -- just a couple of brief comments to make and then a question for you and the committee. The -- I've been listening -- I've been here every day to listen to the testimony that has been given by the City representatives, whether it be Joyce Wilkerson or Linda Berkowitz. And to me -- and this is my opinion and I think the opinion of my union, that it is just been a big game, a stall game. We have -- we were told well before the negotiation process actually began that the City's main demand, main demand that they made to the media, whether it was the print media, the electronic media, was to have a unified health care system in the City of Philadelphia, that they had a study that would show that it would save money, that they wanted the FOP, the firefighters 33 and 47 62 6/14/01 LAW & GOV'T - BILL 000476 health plans dissolved and brought into one. In fact, in the negotiations, this was stated time and time again, particularly in the early negotiations, that they would not even discuss issues such as health and safety or wages or many other issues until the issue of a City-administered plan was dealt with. And we began to get into that and we acceded to that demand. That was there position. We asked them, so help me God, over and over and over again for facts and figures about their plan. Give us information, how would it work, where did you get these savings, and on and on and on, every single day. They refused, absolutely refused, to provide us -- and I'll say this in front of her or in front of Joyce Wilkerson or the Mayor or anyone else. They refused to give us that information, they refused to give it to the City Controller, they refused to give it to the committee. What's going on here? But yet they put it out to the people of Philadelphia as propaganda that they had this study, that they had all these savings in order to really beat our brains in in terms of health care. And yet 63 6/14/01 LAW & GOV'T - BILL 000476 when they've been asked over and over and over again, for not just a period of a couple days or a couple of week, but over a year, they don't have the information. My question is really simple now, and that is: Does this committee have the power, when it calls witnesses, whether they're union witnesses, whether they're City Administration witnesses or anyone else, to swear people under oath? And if they do, I would strongly feel, whether it's me, whether it's Linda Berkowitz, or whether it's Wilkerson or the Mayor, that people be sworn and be reminded of penalties of perjury. Because if they do that, this is what should happen here. I'm sick and tired of hearing the absolute lies and distortions. Didn't know what was going on. She was a part of the negotiating team, she sat there for these negotiations. This is just so absurd. It's like saying the three of you really aren't there, you're some metaphysical aberration. This is just nonsense. People should be sworn and reminded that if you lie or fail to give the information of perjury. It's just ridiculous. 64 6/14/01 LAW & GOV'T - BILL 000476 This issue isn't going to go away. In six months or less, the negotiations with police and fire are going to start again. And we haven't gotten one ounce of cooperation. And yet, we give them everything. And they're a trustee, sits on our board, has the right to it, and gets it. And yet, we hear over and over again, they don't have this, they don't have that, they're telling the Controller they don't have this or they don't have that. When are people saying enough's enough here? (Applause.)
The committee will take your request under advisement. We generally, over the years, have never taken, except in one instance, one committee for a short time put all witnesses under oath. We hoped that we could achieve truthful responses without that formality, but we will consider your motion. This might be an appropriate circumstance where we have to reconsider the procedure and adopt very formal procedures which could hold accountable witnesses for the true of 65 6/14/01 LAW & GOV'T - BILL 000476 their statements.
Chairman Cohen, let me just again repeat that I'm not asking for something -- a different standard for the City Administration than I would ask for the union. If they have to be sworn, we'll be sworn. Let's have equal justice for all here. I think it's about time for that.
All right, thank you. Is this any other witness who wishes to be heard today? Miss Simpson. (Witness comes forward.)
Louise Simpson, chief cook and bottle washer and troublemaker. I have a question. I don't know whether it's appropriate, but I want to place it before you as president of this committee. The Freedom of Information Act relates to those areas that impact with federal monies. The City of Philadelphia gets federal monies for all kinds of things, and I do not know whether or not it is applicable under the Freedom of Information Act to get the information 66 6/14/01 LAW & GOV'T - BILL 000476 that we want.
This committee is in no position whatever to make any sort of reply.
I'm just raising the issue to put before the committee to see whether or not this is in fact one way of doing it. Because the Board of Pensions has also said that the information is confidential, they cannot put it out to individuals. However, I don't know if that is applicable to members of City Council and especially this committee. I don't see that it has any relevance.
Is there another gentleman who wishes to be heard? If not, the committee will stand in recess until Tuesday, June 19th, at noon, in the chambers, in the room we're meeting in now. Thank you. 67 6/14/01 LAW & GOV'T - BILL 000476 (Adjourned 2:17 p.m.) - - - 68 C E R T I F I C A T E I HEREBY CERTIFY that the foregoing proceedings of the Council of the City of Philadelphia of Thursday, June 14, 2001, were reported fully and accurately by me, and that this is a correct transcript of same. RE: COUNCIL COMMITTEE ON LAW AND GOVERNMENT RES. NO. 000476 __________________________________, JOSEPHINE CARDILLO, Registered Professional Reporter