Opinion ID: 855052
Heading Depth: 3
Heading Rank: 2

Heading: Employer Contributions and The Reserves

Text: The Trust Agreement required the participating agencies to make the necessary contributions to provide the benefits expected to become payable under this Trust. According to the CAAIG Health Coverage Plan, the failure of any participating agency to submit the appropriate premium charge within the grace period of 30 days shall cause coverage for all claims to cease from that month forward. To ensure the financial integrity of the Plan, the Trustees maintained approximately $1 million in reserves (the Plan Reserves), which funds were for [the] security of the plan and could not be distributed to any member while the plan was in existence. - 5 - At some point, Yonkers CAP and EOC Suffolk began experiencing difficulty paying their Plan contributions. By 1990, Yonkers CAP owed approximately $100,000 in arrears. Although the Trustees initially terminated Yonkers CAP's participation in the Plan, they reinstated Yonkers CAP on assurances that it would pay d own its overdue contributions. After reinstatement, however, Yonkers CAP failed to pay down the contributions in arrears. Similarly, in 1990, EOC Suffolk owed the Plan approximately $38,000 in arrears, but the Trustees permitted it to remain in the Plan and pay down its delinquency on an as possible basis. On September 1, 1992, LIHS withdrew from the Plan and requested the immediate return of the portion of Plan Reserves attributable to its past contributions (the LIHS Reserves). The Trustees refused to refund the LIHS Reserves.