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Teachers urge delay in health care switch
A class action lawsuit, Kono et al. v. Lingle, et al., was filed in First Circuit Court on September 14, 2010 on behalf of over
15,000 active and retired school teachers. The lawsuit seeks to prevent the State from forcibly transferring teachers’ health
benefit plans from the VEBA Trust established by the Hawaii State Teachers Association (HSTA) in 1985 to the insolvent and
mismanaged EUTF. The State is forcing public school teachers, through Act 106, to transfer their health benefit plans by the
end of the year from the Voluntary Employees’ Beneficiary Trust (VEBA) to the teetering and financially insolvent Employer-Union
Benefits Trust Fund (EUTF).
The teachers want to retain their membership in VEBA Trust because it is both solvent and less costly to operate. Additionally,
this lawsuit seeks the return of approximately $3.9 million of surplus wrongfully taken from the VEBA Trust by the State. The
trustees of the VEBA Trust have also joined this suit as Plaintiffs.
In April 2010, Governor Lingle described the Hawaii Employer-Union Benefits Trust Fund (EUTF) as “insolvent” and noted that its
“governance is untenable.” The Governor expressed concern that the EUTF would be unable to provide medical benefits to over
66,800 active state employees and retirees.
To read Governor Lingle’s letter, please go to www.hsta.org.
For more information on the lawsuit, please go to the Teacher
Connections at http://connections.hsta.org/.
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