By Peter Hirschfeld for TimesArgus.com

MONTPELIER — Rutland City Mayor Christopher Louras on Wednesday urged lawmakers to pursue with force the single-payer health-care proposal now under consideration in the Statehouse.

At the risk of offending his former Republican colleagues and the Rutland business community at large, Louras said, he believes the state’s health-care system must be “blown up” and remade from scratch.

Enacting a publicly financed system that delivers universal care and decouples medical coverage from employment is the only way to save municipalities like Rutland City from collapsing under the weight of rising health-care costs, Louras told the House Committee on Health Care.

“I have not made friends among former colleagues with ‘Rs’ next to their names,” said Louras, a former Republican representative from Rutland who served on the same health care committee to which he testified Wednesday morning. “And I think it’s fair to say the city’s position on universal health and the Rutland Chamber of Commerce’s and business community’s may not be specifically aligned.”

Still, Louras said, pressure on the city budget wrought by rising health-care costs have compelled him to speak out in favor of the single-payer plan.

“I started out as a skeptic of single-payer universal,” he said.

After assuming his mayoral post four years ago and seeing firsthand the impact of health-care costs on the city budget, Louras said, his perspective has changed.

Rutland is on pace to spend $7 million in payroll expenses in 2011 for 150 city employees. More than $2.5 million of that, Louras said Wednesday, will be spent on health care. And the figure would have been higher, he said, if the city hadn’t negotiated a new higher-deductible plan that could require more out-of-pocket expenses for city employees.

Those figures don’t include the $15 million in unfunded liabilities associated with health-care benefits for retired city employees.

“It has created a situation where, frankly, as individuals retired, I have not replaced those retirees due to the double cost of covering health insurance,” Louras said.

Rutland pays $16,000 per employee annually for a two-person plan and “north of $22,000” a year, Louras said, for an employee who opts for the family plan. As a result, he has left many vacant city positions unfilled; the Rutland City Police Department has three fewer officers today than it did four years ago.

“We’ve been drawing down staff not because it was easy or there was fat in the budget, but drawing down staff as matter of necessity to keep the budget within a range that was tenable to taxpayers,” Louras said. “And the largest piece that we could not control is health care.”

Louras said “incremental” steps like Catamount Health, an initiative he voted against as a lawmaker, won’t solve the problem that cities like Rutland now confront.

“Controlling health-care costs, and therefore controlling budgetary costs associated with health care, is a problem that needs to be licked and frankly I do support, as chief municipal officer of the city of Rutland, the universal single-payer health care under the conditions that have been defined by the governor of the state of Vermont,” Louras said.

Louras said his support is conditioned on one caveat: public employees cannot be eligible for taxpayer-subsidized “wraparound” coverage to supplement the basic benefits package envisioned in Shumlin’s plan.

Exposing municipalities to the cost of supplemental coverage, he said, would undo the cost-cutting benefits of a single-payer system.