A lot of current and retired Slidell city employees breathed a sigh of relief Tuesday night after the City Council unanimously passed an ordinance that not only will save the city money, but also will set up a health benefit plan that is agreeable to employees.

It wasn’t an easy thing to do. At a council meeting earlier in the month, many city employees came forward asking that the council change the ordinance. Many were unhappy because the legislation would mean that employees ready to retire would have to work longer in order for the health benefits to cover their dependents. There were also employees who had joined the city ranks after working for outside agencies who were worried that they would lose their benefits because of language that required all employees to be on the health plan for at least five years.

The council and the city administration have been struggling with the problem for a long time. Councilman Bill Borchert said that the city currently has an unfunded liability to retirees and future retirees of $53 million. The unfunded liability is what the city owes to the employees for retirement and benefits. Mayor Ben Morris said that 11 years ago there were only 33 city retirees and it cost the city $127,000 a year. Today there are 99 employees, and the city pays out $1.1 million a year for retirement benefits. With health costs rising, and more employees retiring, the city’s fiscal responsibility will go even higher.

“The changes we propose will bring the unfunded liability down to $25 million, saving the city $18 million,” Borchert said. He added this would mean a cash flow savings of $350,000 to the city over the next 10 years.

After a lot of negotiating, the council came up with a sliding scale of benefits depending on how long a person has worked for the city.

The other important change was that employees, their spouses and dependents that were on the insurance plan before Tuesday night were exempt from the five-year requirement.

Under the sliding scale employees who were hired before Sept. 1, 2008 and retire after June 20, 2014, the city will pay 100 percent for employees with at least 25 years.

Employees with at least 20 years but less than 25 will get 90 percent of their premium paid for by the city, and the city will pay 80 percent of the premium for employees with at least 10 years of employment but less than 20.

When these employees reach the age of 65 and are eligible for Medicare, they will apply for Medicare Parts A and B, and they will be enrolled in the city’s Medicare Advantage Plan under the same percentages for length of employment.

Employees who are hired after Sept. 1, 2008, must have at least 10 years of employment with the city to participate in the medical program after retirement. Those employees with 25 years or employment are eligible to have the city pay 75 percent of their premium. The city will pay 65 percent and 55 percent of the premium for employees who have worked at least 20 years and 10 years respectively.

The employees in this group will join Medicare at 65 and the city will no longer pay any medical benefits.

Councilman Joe Fraught said the council and employees worked hard and long to work out a suitable compromise.

“I think we have solved all the problems, the employees asked us to solve,” he said.

Mayor Ben Morris said that he was glad the “long agonizing nightmare” over health benefits was done.

“It has been an interesting journey for all of us,” the mayor said.