Also Tuesday night, the council approved by a 7-1 vote an $800,000 liability-insurance contract for 1986 with the John Siracusa Agency. It is four times more costly than the 1985 policy.
Councilman James Sykes, chairman of the Finance and Revenue Committee, said the one-year contract is a "blanket, all-risk plan" for police liability, general and automobile liability and workers' compensation and an umbrella policy for the city.
However, the plan, underwritten by Mead Insurance of New York, calls for $1 million deductible, which is four times higher than the $250,000 deductible under the old policy.
Sykes said the city had received no bids on its 1986 insurance policy, adding that many companies are reluctant to cover municipal police liability. Skyrocketing insurance increases are a statewide problem, Sykes said, and many New Jersey communities have difficulty getting private insurance.
The city's governing body was considering becoming self-insured, when the Siracusa agency submitted a proposal that would have cost the city $2.5 million, compared with $193,000 for the 1985 policy.
Sykes said the city did not have "the experience or disposition at this time to go into a total self-insured type of situation" and after a series of meetings with the Siracusa company worked out the $800,000 premium plan with $1 million deductible.
The new contract has a 60-day cancellation clause and, according to Sykes, the city is negotiating with other companies "to see if we can come up with a better deal."