Circuit Court Judge Mark Schiveley found the city of Medford in contempt Monday for failing to provide insurance to retired employees.
The city will be fined $100 a day starting Nov. 1 if it doesn't provide the coverage, which the city estimates will cost about $1.8 million annually.
In his ruling involving former Medford employee Joseph Bova, Schiveley said the city has resisted court orders from 2009 that retired city employees are entitled to "bridge" health insurance until they reach age 65.
A separate ruling by Schiveley requires the city to purchase an insurance plan that would cover all employees and retired employees.
In February, the Oregon Supreme Court ruled the city of Medford must provide health benefits to its retirees — or prove that it is unable to do so.
The Supreme Court found the retirees have constitutionally protected rights to health care coverage.
Other lawsuits, led by Medford's former City Attorney Ron Doyle and Bova, have been winding their separate ways through state and federal courtrooms for nearly six years.
The courts have treated the two cases differently because Doyle was retired when he filed the legal action, while Bova was still employed with the city, though he is no longer an employee.
Schiveley said the city is usually not required to pay any portion of a retiree's cost for health coverage. Because the city violated state law, Schiveley ruled the city must pay the excess premium costs for the retirees and the existing employees for one year.
Doug Detling, the city's human resources director, said the city estimates it will end up paying about $1.8 million annually, but it doesn't have the final numbers yet from the insurance carrier.
Nearly 100 of the city's 105 management employees have said they don't want any part of Bova's class-action suit, fearing it would increase health costs and extend benefits to retired workers.
The case is being watched by other municipalities throughout Oregon because they offer the same type of insurance and would have to provide similar coverage to retirees.
Reach reporter Damian Mann at 541-776-4476, or e-mail email@example.com.
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