In December 2011, the Niagara Falls Reporter discovered that Niagara Falls Council woman Kristen Grandinetti was wrongfully overpaid for health insurance opt-out money as a result of being misclassified. Grandinetti was mistakenly listed as qualified for the higher payments due to someone with a family plan.
She should have been classified as a single person. As a result, she was overpaid $5,670.50 of opt-out money.
Grandinetti, who is employed by the Niagara Falls City School District, receives health insurance coverage through the School District and chose to take the generous opt-out payment available from the city. Niagara Falls city employees who have health insurance coverage, through their spouse or from another job, may opt-out of taking the city's health insurance coverage, and accept a monetary payment, which they get in their bi-weekly paychecks.
Grandinetti says that she did not realize that her paychecks were hundreds of dollars higher than they should have been, since she claimed that she did not know how much the opt-out payments were supposed to be.
Over a period of 22 weeks, Grandinetti received family plan benefit opt-out payments of $404.71, when she should have only received $146.96 per pay period.
After the Reporter broke the story, it was reported in most other news outlets.
“I was very surprised when I found out about it,” Grandinetti told the Buffalo News. “I'm upset and concerned that people would think I would do something like this purposely.”
After the story broke, it was generally thought that Grandinetti was having payroll deductions to repay the amounts owed. In reality, the Department of Human Resources is collecting the overpayment by simply ceasing to pay her any opt-out payments, until such time as the accrued amount covers the amount she was overpaid.
As of January 1, 2013, Grandinetti still owes $1,849.54, according to information obtained by the Reporter.
The controller’s office says the decision to pursue repayment in this manner was made by the Human Resources Department.
By their calculations, Grandinetti will settle the obligation by the June 28, 2013 pay period. After that, she can start receiving the $146.96 opt-out payment per pay period again. But will she?
Last year, Grandinetti sponsored a resolution that council members, as elected officials, should cease taking opt-out payments. She argued that it was wrong and fiscally irresponsible, and that a council member should take the lead in being frugal for the people they represent.
After all, if a council member has health insurance through another employer, why should he or she further soak the public by taking opt-out cash payments for not taking health insurance in one of the highest taxed cities in the country?
The generous Niagara Falls offers its employees the highest opt out in the region and perhaps the nation. A married person can receive around $9,000 per year – not to take health insurance - if they already have it.
Although Grandinetti’s measure failed – each of the four other council members voted against it - she told the Reporter that she personally pledged to stop taking the opt-out payments, regardless of whether the measure passed or not, as a gesture of her own fiscal conservancy, and proof that she puts her money where her mouth is.
Taking the opt-out, after trying to get (or, as some say, shame) her cohorts into not taking it, would be hypocrisy.
Once in a while – and it is not often- one gets to gauge the moral compass of an elected official. This is an ideal chance for Grandinetti.
Of course technically she is still getting her opt out payment which she is using to pay back her little mistake. But we will check back in June, after she finishes paying back her ‘mistake,’ to see if she lives up to her word and actually declines the actual opt out payment that she tried to get her fellows on the council to stop taking.