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Supreme Court says no intervention for some towns fighting for LGC payback

New Hampshire Union Leader

June 29. 2013 11:37PM

The New Hampshire Supreme Court has denied a motion to intervene by towns that sought a share of a return of $53 million that the state Bureau of Securities Regulation ordered the New Hampshire Local Government Center to return to member communities.

LGC has announced a list of members that will receive checks from the first part of the order - a return of $33.2 million to members of LGC's health insurance risk pool - on Aug. 27. LGC determined the list based on members as of 2010, which follows the order.

Fourteen towns, led by Durham, Northfield, Peterborough and Salem, all of whom had taken their insurance business elsewhere prior to 2010, filed the intervening motion, arguing that the return of funds should have been proportionate to what communities paid for insurance coverage through LGC programs over the years they were members.

Durham Town Administrator Todd Selig called the ruling disappointing, but said the towns may seek relief by suing in Superior Court.

He said LGC's plan would "specifically exclude Durham, Northfield, Peterborough, Salem, and numerous other political subdivisions across the state in similar situations, from their proportional share of the return of surplus. This is inherently unfair to our local taxpayers."

LGC has yet to announce how it will meet the rest of the order, in which the agency must repay about $3.1 million to members of its property and liability risk pool and return $17.1 million that the hearing officer determined was improperly taken from members of the health insurance pool and used to subsidize the workers' compensation program.

LGC officials have said they will likely use a similar formula - members received a share proportionate to what they contributed to the risk pool in 2010 - for returning the $3.1 million, which is also due Sept. 1.

However, the workers' compensation program has no cash reserves and LGC officials are struggling with how they will make that payment. The $17.1 million payment is due Dec. 1.

LGC posted its decision on its website.

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