New London - The settlement packages for two city police captains who retired earlier this month include salary payments through July 1 and extended health insurance benefits coverage.

Deputy Chief Marshall Segar, whose one-year contract was not renewed, will receive one year's pay of about $105,000; one year's worth of insurance coverage; and a $21,000 contribution to his retirement savings plan as outlined in his contract.

But still unclear are the value of the packages, the cost to the city and where the money will come from to pay for them.

City Councilor Adam Sprecace questioned the agreements on Tuesday, saying that the council was not privy to the details of the agreements and that no money has been budgeted to cover any additional the costs.

"I believe each appropriation has to come before the City Council,'' he said. "Now you have all this new spending. ... If they don't pass (the council), we're going to have issues."

But Mayor Daryl Justin Finizio, who announced the changes in the police department's managerial structure earlier this month, said in a statement Tuesday that department heads were consulted and the finance director assured him there was money in the budget to cover the agreements.

Capt. Michael Lacey, a 28-year veteran of the department, and Capt. William Dittman, who was with the department for 35 years, each will continue to earn about $1,700 a week through July 1.

Lacey will receive his full salary for the next 4.5 years under the agreement, which requires the city to make up the difference between his base wage and his pension benefit.

Dittman also will receive family health insurance for the next seven years, until he turns 65 and becomes eligible for Medicare.

All three officers will be paid for accrued vacation, holiday and compensation time.

Dittman and Segar declined to comment. Lacey could not be reached to comment.

Bernadette Welch, the city's personnel coordinator, said the city is self-insured and pays medical bills directly, so there are no annual premiums to pay.

Segar's health insurance was contractual, while insurance for the two captains was anticipated, she said, because each had a valid worker's compensation claim that would have ensured medical benefits upon retirement, regardless of when it occurred.

In a statement released Tuesday, Finizio said, "The Personnel Coordinator and Law Director negotiated the Captain's retirement agreements in consultation with the Finance Director before the recommendation was made to the Mayor.

"The decision not to renew the Deputy Chief's contract was discussed with the Personnel Coordinator, Chief Administrative Officer, Law Director's office, Chief of Police and Finance Director before the final decision. The City was assured that the decision was in its full legal right and within the finances available."

Finizio also said a full accounting of the payments is being compiled and will be released by Feb. 8, when internal audits and reviews of the city's budget will be complete.

"When this is finished, the City's financial staff and auditors will meet with Council leadership and the Mayor to present their full report,'' Finizio said.

k.edgecomb@theday.com