Dan Waters

Multi-million T/E budget surplus (again) – $12.4 million surplus in 4 years! Property tax increases for 10 years in a row and still no health insurance for aides/paras!

budget surplusIn spite of $12.4 million in budget surplus the last four years, TESD residents have seen yearly tax increase and yet sadly, the District still does not provide health insurance coverage to their aides and paras.

I have regularly attended school board meetings and associated finance meetings the last 4 years and I have been amazed at the yearly District budget surplus. This week at the Finance Committee meeting, we learned that once again, the District has a multi-million budget surplus – yes, a review of the 2013-14 budget indicates a surplus of $2.2 million.

Thought it would be interesting to review the District’s budget surplus for the last four years. The surplus schedule is as follows:

2013-14: $2.2 million
2012-13: $5.0 million
2011-12: $3.9 million
2010-11: $1.3 million
Total: $12.4 million

Where exactly does the budget surplus go each year? We know that it does not go the cost to providing healthcare to all District employees. The aides and paras remain without health insurance, the residents continue to receive yearly tax increases and the surplus feeds the ever-increasing District’s fund balance. According to the District, as of July 1, the fund balance has grown to $32 million! Remember, the fund balance growth represents surplus from the District’s yearly budget. It would be surprising if this isn’t the largest fund balance of any school district in the state.

I truly struggle to understand how the District manages to add multi-million dollar budget surplus to the fund balance over the years but the residents continue to feel the sting of an annual tax increase. I recall the District’s business manager Art McDonnell’s explanation of the whopping $5 million surplus last year – primarily due to reduced health insurance premium costs for employees. Clearly, last year was not a fluke when you review the mega-millions in budget surplus over the years.

It would be easier to accept the yearly budget surplus if we did not also have a tax increase each year. In fact, you would have to go back a decade to 2004-05 to find the last time that there was no increase. A review of the District yearly tax increase since the last no-tax year is as follows:

• 2014-15: 3.4%
• 2013-14: 1.7%
• 2012-13: 3.3%
• 2011-12: 3.77%
• 2010-11: 2.9%
• 2009-10: 2.95%
• 2008-09: 4.37%
• 2007-08: 3.37%
• 2006-07: 3.90%
• 2005-06: 1.40%
• 2004-05: Zero Tax Increase

Where exactly does the budget surplus go each year? (We know that it does not go the cost to providing affordable healthcare to all District employees.) The aides and paras remain without health insurance, the residents continue to receive yearly tax increases and the surplus feeds the District’s ever-increasing fund balance. According to the District, as of July 1, the fund balance has grown to $32+ million! Remember, the fund balance growth represents surplus from the District’s yearly budget. TESD’s fund balance could well represent the largest in the state.

I fully understand the impact of the pension crisis and that unless there is reform; all Pennsylvania school districts are going to fall over the cliff in the near future due to the ballooning costs. I do understand that the District must protect resources for the pension crisis but at what cost to the residents?

Other items of interest from the Finance Committee meeting included responses to Ray Clarke’s questions. By now, most of you have probably heard about the 24 Dell computers fraudulently purchased by someone using the District’s Dell account. This matter is an ongoing police investigation. Ray asked about the District’s ‘purchase process’ and Dr. Waters confirmed that it was actually the internal District controls that uncovered the purchase and there was no financial loss as a result.

Ray referenced Unionville Chadds Ford School District’s receipt of $582K in state grants for construction costs and asked if similar funding was possible for the District’s classroom expansions. Ray’s suggestion sadly was dismissed as requiring too much work for the benefit.

Ray’s comment to me regarding the 2013-14 audit is as follows:

The audited financials showed revenue of $112.9 million, expenses of $110.75 million, for a surplus of $2.15 million, compared to the budgeted deficit (before contingencies) of $1.7 million. Fully one third of the favorable variance to budget ($1.325 million of the $3.9 million) came from “breakage” – the replacement of retiring staff and approved leaves with lower cost staff. This is entirely predictable and we’ve asked for it to be included at budget time for the past several years, but every year the request is ignored and the property tax increase is 30% more than it need be, all other things being equal. There is now $31.7 million of taxpayer money squirreled away in the General Fund Balance and that’s after a $10 million transfer to the Capital Fund a couple of years ago. Perhaps since next year is an election year the Board might turn up their hearing aids.

It continues to be a struggle for residents to receive clear explanations. Materials provided often only offer partial information with many of the suggestions/questions of residents at the Finance Committee meeting dismissed or deferred. No argument that T/E School District is a great school district as all the school rankings indicate —  but is the price for the District’s success no public input allowed?

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I attended Tredyffrin Township’s Board of Supervisors meeting in the last week, and the preliminary 2015 township budget was reviewed and discussed. In addition, the supervisors held a Budget Workshop this week.  The differences between school district and the administration and the supervisors, township manager and  staff are striking.  The next Community Matters post will provide an update.

Superintendent Search underway in T/E School District – Residents invited to assist in finding replacement

Next SuperThe T/E school board has launched a search for a new superintendent and is seeking input from the public through an anonymous survey, “Stakeholder Survey – Superintendent Succession Planning”, available online through noon on Tuesday, June 10.  Participants can weigh in on the qualifications and experiences that they think are most important in a superintendent as well as the strengths and needs in the district.

Public input is important throughout the superintendent process and this online survey allows stakeholders (District residents, parents, students and employees) to provide comments that are a valuable part of the search for the next superintendent. The answers should help guide the school board in the superintendent search to replace current TESD Superintendent Dr. Dan Waters, who will retire from the school district on June 30, 2015.

The following seven questions are on the survey, each with a pick list of responses.

  1. Please select the stakeholder group(s) that best describes you.
  2. Gender
  3. Age Group
  4. Please select the top 5 traits you believe are most important for Tredyffrin/Easttown School District’s new Superintendent.
  5. Please select the top 5 strengths of the Tredyffrin/Easttown School District that the new Superintendent should be expected to maintain or enhance.
  6. Please select the top 5 qualifications which you believe are most important for Tredyffrin/Easttown School District’s new Superintendent.
  7. Please select the top 3 opportunities and challenges you believe our new Superintendent will face. Select at least 3 and no more than 3.

According to the District’s website, the survey results are to be made public.  However, beyond making the survey public, will the results of the survey affect the Board’s selection process?  The feedback reflects the unique needs of the community … how will the results be used by the Board.

Having the community, parents, school district employees and students involved in the superintendent search process provides support for the school board and will lead to a more favorable public perception and build trust.  Sharing the survey results and the search progress in an open, transparent atmosphere makes us, the stakeholders, feel appreciated that we were consulted in the selection process and therefore, more inclined to getting the new superintendent off to a successful start. If the superintendent search is conducted behind closed doors, the new superintendent becomes promoted as the Board’s superintendent, not the community’s superintendent.

Some school board members believe that owing to their election by the community, that they have the right to make all decisions, start to finish, which effectively leaves the residents in the dark about the affairs of the school district.  Taking that stance puts the District in a “no need to know” mode – which may lead the Board to conduct the superintendent search in secret or mostly behind closed doors.  I have attended many school district committee and board meetings and often a prevailing attitude of “we know best” by some Board members and administrators exists.

Frequently attendance at T/E school district meetings is low unless there is an issue of personal concern to residents.  Unfortunately, some Board members (certainly not all) equate minimal citizen participation at meetings as a stamp of approval for their governance; believing that the small group that regularly attends meetings (and is vocal) is not representative of the community.  Regardless if five or five hundred people attend meetings, this community owns the schools and should be involved and kept fully informed regarding its investment.

Don’t get me wrong, I support the survey (and the inclusion of all stakeholders views in the process) but the survey results need to actually ‘count’ and not serve merely as window-dressing for the Board in the selection of the next superintendent.  Most of the questions on the list are standard and the pick-list of responses to be expected.  Some of the questions asked of survey participants appear to be designed to generate an intended result whereas one question ignores important issues facing the District.  As an example, the #7 question completely overlooks significant concerns in the District, such as school safety concerns, drug and alcohol usage by students and low morale of employees —  just some examples of important challenges facing the future superintendent.

Please take the time to fill out the District survey on the superintendent search. The final decision on the superintendent choice is ultimately up to the school board but the community’s involvement in the process is critical.

Standing on the sidelines changes nothing — TE School District aides and paras taking steps to unionize

collective bargainIt’s official, the aides and paraeducators of TE School District are taking the necessary steps to unionize. As announced by Supt. Dan Waters at last night’s Finance meeting, this group of employees is currently engaged in the process to join the collective bargaining unit TENIG (Tredyffrin Easttown Non-Instructional Group).

If you recall last spring, the District’s aides and paras came very close to having their jobs outsourced over the Federal government’s Affordable Care Act.  Because of ACA compliance issues, it appeared that the District would be forced to either offer insurance or outsource the jobs of the aides and paras. At that time, the Board claimed that the District could not afford healthcare for these employees and could not risk the possible financial risks for ACA noncompliance.  As a point of record, the TE School District is the only school district in the area that does not offer healthcare coverage for this group of employees.

Unfortunately, without the benefit of a collective bargaining organization there was little that the aides and paras could do to fight back against the proposed outsourcing of their jobs. In the end, the Federal government pushed off the required ACA compliance for another year.  As a result, the School Board granted the District aides and paras a reprieve for the 2013/14 school year; their jobs and hours remaining intact for one more year.

As the current school year ends, what has changed for the District aides and paras during the last twelve months – are they any better off than they were a year ago? Based on their moving forward with plans to collective bargain, my guess is the answer to that question is ‘no’ – nothing has changed.

Without job security and healthcare benefits, the aides and paras are now seeking protection of their jobs and collective bargaining representation for their own jobs and for the jobs of those that will come after them. They seek fairness and consistency in employment policies and personnel decision,  job security and protection of employee rights.

The community respects the passion and commitment of the aides and paraeducators to the parents and children of this District and values their contributions. It saddens me that this group of vulnerable, dedicated employees remains the school district pawns, at the mercy of the Board and the administration.

Supporting the need for an organized voice, the District aides and paras believe that all employees deserve fair and equal treatment. Standing on the sidelines changes nothing — I applaud the collective bargaining efforts of the aides and paras.; they deserve to be treated as full players not as an afterthought.

T/E Superintendent disputes Montgomery County DA report — Conestoga High School NOT involved in drug trafficking

Conestoga High SchoolIn the days since the Montgomery County District Attorney’s office announced the drug trafficking arrests, including the two ringleaders, Haverford School graduates, the story has become widely reported — from CNN to Good Morning America, there are articles and videos on the subject.

I’m certain that an expensive prep school such as the elite Haverford School (with upper school tuition approaching $35K) is in overdrive with damage control — much is at stake with current parents and the endowments of wealthy alum. With a tag line on their website of “Preparing Boys for Life”,  the Haverford School struggles to handle the PR nightmare.

Watching Good Morning America report on the story and the high schools (Lower Merion, Haverford School, Radnor, Harriton and Conestoga) and the colleges (Lafayette, Haverford and Gettysburg) was sad — and really eerie to the Conestoga High School logo flash on the TV screen along with the others.  But is all the information contained in the Montgomery County DA’s press release of April 21 accurate?   Apparently, not according to T/E Superintendent Dan Waters.

Waters has just released a T/E School District press release which disputes the report of the Montgomery County DA’s office.  Although Conestoga High School was named by the District Attorney in the list of Main Line high schools involved in the drug ring, Waters claims that the information is not correct.  According to Waters in the following press release, no students were identified or arrested from Conestoga High School in this recent drug trafficking incident.  Don’t get me wrong, I want to believe that Waters is correct and that no Conestoga students are involved but it seems strange that the DA’s office would just add Conestoga High School to the list of high schools involved — how does a District Attorney make that kind of mistake?   If Waters is correct and that the Montgomery County DA’s office erred in their report, shouldn’t the T/E School District board and administration demand a retraction?  Shouldn’t Conestoga High School be removed from the list?

Below is Dr. Waters response to the Montgomery County District Attorney April 21 press release —  you make your own judgement.  Coincidentally, the T/E Public Information Committee, chaired by T/E school board member Scott Dorsey, is holding their regularly monthly meeting tonight (6:30 PM, Administration building).  Although the agenda for tonight’s meeting was set before these recent drug arrests, there is certain to be discussion. At every school board meeting, president Kevin Buraks invites the public to attend committee meetings, stating that the ‘real’ work is done at the committee level.  With that in mind, I’m guessing that the Public Information committee meeting may have a ‘higher than normal’ attendance.

The Montgomery County District Attorney’s office press release reported on recent drug related arrests naming nearby high schools and colleges. The press release once again highlights the need for continued efforts to provide a safe learning environment for our students. I write to inform our community that we continue to be vigilant regarding the use of drugs and alcohol by our students within our community.

The safety of our students is paramount in our efforts to provide them with a safe learning environment. The District’s drug and alcohol practices and policies include prevention, deterrence and support for our students. The prevention strategies include classroom education efforts, schoolwide programs, student activities supporting healthy lifestyles and counseling programs. Deterrence efforts include random canine sniffs supported by the police and the enforcement of the drug and alcohol policy when applicable. Support for our students include individual counseling by our school counselors and mental health specialists. The Conestoga High School student support team, known as CARE, accepts referrals from students, parents and staff to assist students who may be in need of services. In addition, drug and alcohol counselors provided through COAD (Chester County Council on Addictive Diseases) are available to our students and families. Within the community, we have our on-going strong partnerships with ARCH (Area Residents Caring and Helping) and the police departments of both townships.

Recently, the Montgomery County District Attorney’s office issued a press release which mentioned a drug distribution ring in local high schools and colleges. Although Conestoga High School was mentioned as one of the schools in the news report, at this time, according to the affidavits forwarded to me from the Montgomery County District Attorney, there were no sellers arrested or identified from Conestoga High School. We recognize that future arrest warrants may be issued by the District Attorney if the investigation continues. We are prepared to assist law enforcement officials when they request our involvement in investigations. What can we do as a community? As the police have directed us in the past, we are all encouraged to contact the police department with information concerning illegal drug activity in our community.

 Please contact the school principal, school counselor or me should you have any questions or concerns.

Dan Waters
Superintendent of Schools
Tredyffrin/Easttown School District

TE Finance Committee meeting — How does the School Board regain public trust?

 I do not know anyone who attended last night’s Finance Committee meeting that left feeling good.  Although the Finance Committee is chaired by Betsy Fadem and includes other Board members Rich Brake and Jim Bruce, all members were in attendance.  Expecting a large audience, the meeting was at Conestoga.  Nearly all chairs were occupied with a significant number of aides, paraeducators and paraprofessionals in addition to teachers, members of TENIG, teachers and residents.

Following the budget discussion, the public comment period was troubling and disheartening.  Based on the TE School Board president Kevin Burak’s email last week, we had learned that the District would not outsource the jobs of the District’s aides, paraeducators and paraprofessionals but instead decrease the hours of 80% of these employees from full-time to part-time status.  The reduced work hours will cause a decrease  in pay as great as 25% — all this to avoid providing an affordable healthcare benefit option as required under the Affordable Care Act.

The Board cited the May 21 in-service day meetings with Buraks, Dan Waters and Sue Tiede and the aides/paras as the reason for this choice – stating that the paras and aides wanted reduced hours to stay employed as District employees.  Not only was this not the case, but also as I have stated previously on Community Matters, as Waters and Tiede explained to the aides and paras at that meeting, reducing hours was not a viable solution because it would then require the hiring of 35 more part-time employees to fill the void.

TE resident Neal Colligan asked the Board why no other alternatives were considered, including the one that he had offered.  For the record, Neal’s outsourcing alternative document was sent to the school board on June 4 with a request to notify that it was received.  Hearing no response, I re-sent the document to each individual school board member and we receiving nothing.  Neither Neal nor I received any notification from the Board that they received the document. Yet last night, school board member Karen Cruickshank not only tells the audience that the Board notified him that the document was received but that additionally, that the Board had thanked him for his efforts.  This simply did not happen.

Neal attempted to reason with the school board and asked they consider other alternatives rather than cut the hours of employees to avoid compliance with Federal law.  Seriously, what kind of message is this sending to our children — if you don’t like a law, look for ways around it?

There was no reasoning with the Board members in regards to their decision to reduce employee hours.  The Board stated that the District’s solicitor and the health care provider had researched the Affordable Care Act and provided the opinion that lowering the employee hours was the only way to avoid penalties for non-compliance. I will say that other than Liz Mercogliano  and Anne Crowley who did not speak, the school board presented a unified team on this issue.

TE resident Joanne Sonn ‘attempted’ to offer her own Affordable Care Act research and to present information that differed from what the District had previously presented.  Joanne had done her homework on ACA and offered names of several legal and healthcare expert sources, including Dania Palanker*,  senior counsel  at National Women’s Law Center in Washington, DC, .  Unfortunately, Sonn was not far into reviewing her research (which disputed the District’s findings) when Board member Pete Motel shut down further discussion by loudly yelling, “You’re wrong” at Sonn.  Motel’s action caused an immediate reaction from the audience and defense of Sonn’s right to ask questions.  Although this resident had much ACA information to offer to the Board, they were unwilling to listen, preferring to close further discussion by referencing the opinion of the solicitor.

In an email to me following the meeting, Sonn says in part, “I felt really disrespected by the board and patronized and I was not expecting that. All we are asking from the school board is to do due diligence. As you heard tonight, they will not listen to anyone but their own advisors. I think if they at least were respectful and open we would have left feeling better about this school board.”

Since the response to Neal Colligan by the Board was similar to Joanne Sonn’s … an attempt to limit discussion on the Affordable Care Act and its requirements, I asked Neal for his thoughts on last night’s meeting.  Here are his comments:

Interesting meeting last night.  Certainly the Board did not want to discuss the fate of the Paraeducators.  Seemed their impression of the situation was that this employee group was satisfied with reduced hours to avoid the ACA.  As that will impact about 80% of these 175 workers resulting in a cut in their total wages next year, I think it was clear that the Board’s impression was wrong.  It was nice to see so many of the employee group out at the meeting.  I wish they could have shared with the Board their individual situations as it relates to the reduced hours solution but I know they are still worried about workplace reprisals.

We don’t know how much work the Board has done on trying to find a plan to comply with the ACA Act so that these employees could maintain their status quo of hours.  They say they investigated and, on the advice of their solicitor, rejected the concept as containing too much liability.  We never heard that compliance could not be done to that another solution was not possible.  The audience last night only heard that they went as far as to ask their paid expert for an opinion.

As one Board member said last night, this situation has been a train wreck.  For the last six weeks, much effort has been spent soliciting outsource venders, negotiating with two of these firms, presenting inflated ACA penalty numbers to the community and finally abandoning outsourcing all together.  The current plan is the fallback avoidance strategy…cut hours and makes all of these folks part-time.  With all that work, time, and money spent on avoidance schemes, it is hard to believe that a compliance solution was fully vetted.  But we’ll never know.

This volunteer Board works as all of our local Boards do in the Public Trust.  They extract money from the community through taxes and use it for a public purpose; our community schools.  But the Trust of the Public is exactly what is missing here.  There were ugly parts to last night’s meeting as the audience clearly disagreed with the Statements of the members of the Board.  The shouting down of community members who rose to give opinions was also ugly.  I believe that this Board has lost its most critical attribute that it needs to carry on in the Public Trust and that attribute is the Trust of the Public.

As Neal states, the aides and paras are “worried about workplace reprisals” and fearful of speaking out.  They saw what happened to a resident Joanne Sonn when she dare offer an opposing opinion (and Ms. Sonn is not an employee of the District.)  It is remarkable to me that residents are encouraged by the Board to get involved, attend school board and committee meetings.  I guess what that really means is that you are welcome to attend, just don’t dare have an opinion.  I have often wondered why more residents are not involved but after last night, I know understand why.

Besides Joanne Sonn and Neal Colligan, the other TE resident asking questions at the Finance Committee was Ray Clarke and here are his comments:

Last night’s Finance Committee meeting was most astonishing to me for the complete absence of any interest in collaboration with the community and affected employees to solve the aide/para healthcare issue.  The default approach is “how do we get around the AHA?”, not “how do we comply with the AHA most efficiently?”  Inexcusable.

We did also get for the first time an integrated picture of the expected financial results for the year, although you had to be quick with ear and pen to catch the numbers.  It’s part of a pattern of the Administration to keep all information tightly controlled.  Anyway, as best as I could figure, it looks like we are heading for revenues of $111 million ($2 million over budget) and expenses of $106 million ($3 million under budget).  The net result: a $5 million surplus.

It should be noted that $0.8 million of the revenue was paid by Vanguard under protest and is subject to the result of their assessment appeal.  Key parts of the favorable expense variance are $1.8 million of healthcare, $0.5 million of salary due to retirements and leaves and $0.2 million for transportation.

So there are a couple of important questions.  First, does this outcome have any impact on the 2013/14 budget, revenues of $112 million (up only $1 million with a proposed $1.5 million tax increase) and expenses of $114 million (up $8 million)?  Well, apparently not.  But of course there is no documented analysis of that.  Dr Brake did have a shot at getting an breakdown, but that went nowhere.  The Board should demand a clear explanation before voting next Monday to approve any tax increase for 2013/14.

Second, what to do with the surplus?  Dr Motel was quick and brusque in claiming it for his Facilities empire.  I asked for an explanation of how the $50 million Infrastructure Implementation Plan is vetted by the Board, and it is clear that there is no integrated oversight.  After the proposed approval on the Consent Agenda, the next the Board sees will be a decade-long, rolling series of one-off projects, also slotted in the Consent Agenda.  Who is making the trade-offs between employee benefits and security and new kitchens, lights and toilets?

It could indeed be that the best use of the surplus is a transfer to the Capital Fund.  The district has some $60 million of debt and interest to be repaid over the next dozen years, of which all but ~$10 million has already been spent.  Although there is a good argument that the cost of new facilities is properly shared with future generations through debt financing, the district needs to be very prudent in loading up with more and more interest-bearing debt.  The first step, though, is of course to make sure that the funds need to be spent in the first place…..

There’s an important Board Meeting next week, but last night’s evidence does little to inspire confidence in Board or Administration leadership.

Isn’t it amazing how last November 2012, the District discovered a surprise surplus of $3.9 million from the 2011-12 budget. Other than some health insurance adjustments, it was never clear how the financial forecast could have been off by nearly $4 million last year.  And if you recall, the surplus was conveniently found immediately following the signing of the teachers’ contract.

If we were to believe that last year’s budget surplus was a fluke of nature, guess what – the fluke happened again. According to Art McDonnell, it sounds like the District will have a surplus of $4-5 million from the 2012-13 budget.  Two things come to mind – if the District has a surplus of $8-9 million in the last two budget cycles, how is it that (1) we cannot afford to offer affordable health insurance to every full-time District employee  and (2) shouldn’t the taxpayers receive a check for overpaid taxes?

The questions continue but the answers do not.  Perhaps the Board will behave differently at next Monday’s School Board meeting … the cameras are on and their performance is recorded.  If you are an aide or paraeducators, a resident, TENIG employee, a teacher or a parent – I encourage you all to attend the meeting, June 17 at 7:30 PM, Conestoga HS.

Open dialogue and communication are key to the success of any organization. As TE School District residents, we have a right to comment and to ask questions of our District leaders and we cannot allow that right to be taken from us.

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*  Joanne Sonn has had extensive communication with Dania Palanka, as she sought expert legal assistance to better understand the Affordable Care Act and what its requirements would mean to the TE School District. Here is a brief background from Ms. Palanker’s resume — Dania Palanker focuses primarily on implementing health reform and expanding access to quality, affordable health care for women and their families. Prior to joining the Law Center, Dania worked for the Service Employees International Union (SEIU). Starting her work at SEIU in the research department, she became interested in expanding access to health care to low income families and spent a few years as Deputy Administrator of a health benefit program at SEIU, working to provide affordable health insurance to previously uninsured low wage workers and their families. After the passage of the Affordable Care Act (ACA), she worked on implementing the law as Associate Director of Health Policy. Her background in the ACA includes insurance reforms, coverage expansions and delivery system reform, with particular expertise in employer benefits and insurance reforms. She is a graduate of Georgetown University Law Center and the John F. Kennedy School of Government at Harvard University.

Based on Ms. Palanker’s background, it appears that she is eminently qualified to address ACA compliance requirements in the TE School District.

TE School District response to the Affordable Care Act — Reduce employee hours

Now that the dust begins to settle on yesterday’s announcement that the TE School District will not outsource jobs of aides, paraeducators and substitute teachers for the 2013/14 school year, residents and employees are again left with more questions than answers.

My initial reaction upon hearing the news that 260 District jobs were saved from outsourcing was enthusiastic;  but now in hindsight, I admit it was probably premature.  I was thrilled for this group of employees, believing that the School Board had finally recognized their value and commitment to the District’s children, in making the choice not to outsource.

However, after spending a few minutes reviewing Burak’s email to the employees in addition to phone calls and emails, the celebratory mood quickly changed. The statement reads that the “District will restructure the work hours” of the employee to comply with the Affordable Care Act and “does not result in new costs or penalties to the District”.

What we learn from Burak’s words is that the School Board’s way around the ACA compliance issue it to reduce employee hours. The ACA does not require the District to provide health insurance to those employees working less than 30 hours a week – so the District’s answer to the Federal law is simple… cut hours. TESD is the only school district in the area that does not provide health insurance for their employees – Great Valley, Radnor and Lower Merion school districts all offer healthcare coverage to all their employees.

Does the School Board want the community to feel good about what they are doing?  Is this an acceptable solution? Where is the plan for the future … the vision … leadership?

Keeping healthcare coverage out of the hands of the least paid and oh, by the way, we are reducing your hours to comply with Federal law.  This same Board gave the District administrators salary increases and bonuses and in less than 4 months is now cutting the hours of aides and paras.  But don’t forget the Board also gave this group of employees a 1% raise. If you are an employee making $10/hr., with your 1% raise you will now make $10.10/hr.  However, don’t get too excited District employee because we now must reduce your hours below 30 to avoid offering you health insurance.

Let’s review; the Board gives bonuses, raises and a Cadillac health plan to the highest paid District employees but provides no insurance coverage and cuts the hours of the least paid District employees.  Seems hardly fair or equitable.

I had a phone call last night from a District aide who works 37 hours a week and cannot afford for her hours to drop below 30 hours.  Her family’s health insurance is covered through her husband’s employer and they do not need coverage from the District.  Her question to me — would she still be able to work the 37 hours a week in the District because she does not need the health insurance from the District.  Of course, I could offer no definitive response.  What would she have to do, sign an agreement with the District saying she wouldn’t take the health insurance if they offered it to her?  This aide also wanted to know ‘when’ this matter would be resolved, what was the timeline for knowing if she would have 29 hours or 37 hours?  Again, I don’t know and School Board President Buraks offered no details, except to enjoy the summer and he’d see them in the Fall.

I recall previous suggestions about reducing the hours below 30 hours so that the District would not have to offer health care coverage and comply with the Affordable Care Act. Dan Waters response was immediately negative to that suggestion, stating that the kids would suffer with the reduction in hours.  Yet magically a month later, are we now to believe that the kids will no longer be in danger with a reduction in the hours of the aides and paras?

Beyond the personal effect on the employee in reduction of hours, how exactly does the District expect to make up the discrepancy and provide adequate coverage for the students?  Is the plan to hire additional part-time employees to make up the missing hours? If so, at what cost?

Addressing the District aides, paras and substitute teachers in his email, Buraks states, “… we greatly value and appreciate the contributions that you make to our students and staff every day.” – To that, I’d say that you certainly have an odd way of showing it!

Bottom line … there are many unanswered questions and the employees and the residents deserve answers.  Finance Committee meeting is Monday, June 10, 7 PM at Conestoga High School.  I hope that the Board and the administration is prepared to respond to the questions.

Say No to Outsourcing in TESD … An Outsourcing Alternative

The decision about outsourcing the aides, paraeducators and substitute teachers should not only be about money.  It should be about doing what’s right — these employees are part of our community and deserve to be treated fairly.  The outsourcing sales pitch may seem like the answer but it’s not a panacea.  I hope that the Board and the administration will re-think the proposed outsourcing … tripping over dollars to pick-up pennies is not a solution.

Following the May 13th TE School Board meeting, the community was left with many unanswered questions related to the proposed outsourcing of the aides, paraeducators and substitute teachers.  Requirements of the Affordable Care Act  (ACA) and the effect that compliance will have on the District are at the core of the situation.  The aides, paras and substitute teachers are the only group of TESD employees not currently receiving health care benefits.  As of January 1, 2014, the ACA will require the District to offer these benefits to all employees working 30 hours or more.

Since the last School Board meeting, the aides, paras and substitute teachers, representing all 8 District schools, have met three times and I attended the meetings.  The mission of the meetings was to disseminate information and discuss acceptable alternatives to outsourcing.  The meetings were intended to provide a ‘safe’ forum where affected employees could express their concerns and ask questions, yet some did not attend, fearing workplace retribution for their participation.

At my request, Neal Colligan attended the meetings and helped us understand how the District could comply with the ACA without resorting to outsourcing.  I want to be clear that neither Neal nor I represent these employees – we are simply residents seeking a solution to a community issue. Through the discussion with the paraeducators and other members of the community, an outsourcing alternative evolved.  As part of the collaborative effort, Neal spoke with health care experts to better understand the requirements of the ACA and what compliance would mean for the District.

The parameters of the ACA requires that the school district offer health insurance to its employees that work 30 hours or more that is both affordable and of minimum value.  Currently the only group of employees in the District not receiving health care benefits is the aides, paras and substitute teachers.   The ‘affordable’ test means that the employee cannot be asked to pay more than 9.5% of their household salary for insurance. The insurance plan is of minimum value if “the plan’s share of the total allowed costs of benefits provided under the plan” is at least 60% of such costs.

Given the information available, Neal created a conceptual outsourcing alternative that would comply with the law and keep the jobs of 260 employees from outsourcing. (Click here for copy of the outsourcing alternative). The alternative was presented to the aides, paras and substitute teachers in attendance at this week’s meeting and copies were sent to the administration and school board members for their review (in advance of Monday’s Finance Committee meeting).

Neal provided the following explanation of the outsourcing alternative for today’s Community Matters post:

As the District has spent all of its time on a plan to outsource to avoid the Affordable Care Act (ACA); we based our plan on the idea of complying with the new Federal Law.  With the help of community members and industry experts, we were able to price a health care insurance offering that is Affordable and meets the minimum standards required by the ACA.  You will see in our analysis that complying with the Law (and offering a health care option) should be far less expensive to the district and its Taxpayers than paying the fee attached to outsourcing.  We’ve also done some work on  PSERS costs as it relates to this employee group and have devised a plan to neutralize those cost increases to the District.

Please know that this is a conceptual plan only.  We did not have all of the information needed to develop “hard” numbers.  The District, if it decides to investigate this option, would not be limited by estimates.  Further, the cost of our insurance offering was also estimated.  We believe this to be a conservative estimate as the District is a large insurance client and may be able to secure this type of plan at a more competitive cost.  The new insurance plan offered (in our analysis) may be considered discriminatory as it is not of the caliber offered to the other District employee groups.  Certainly it is no more discriminatory than the current situation where this employee group is not covered at all.  We also believe the District is not in danger of violating the discriminatory parameters of the ACA as they do not meet the test of “fully insured employer” (they are partially self-insured…this may be too mush inside baseball for many).

We ask the District to consider this conceptual approach.  We believe an alternative to outsourcing along these lines can and will produce a more cost-efficient and sustainable solution while keeping this employee group as District employees.

If you oppose outsourcing the jobs of the District’s aides, paraeducators and substitute teachers, please plan to attend these meetings:

  • Finance Committee Meeting: Monday, June 10 at 7 PM, Conestoga High School
  • School Board Meeting: Monday, June 17 at 7:30 PM, Conestoga High School

The School District spins the roulette wheel on outsourcing vendors – What’s going on in TE?

The saga of outsourcing continues in Tredyffrin Easttown School District … Last week at the infamous TE School Board meeting, we listened as the Administration and School Board members presented the case for outsourcing of aides, paraeducators and substitute teacher positions.  The business manager Art McDonnell, personnel director Sue Tiede and superintendent Dan Waters provided the background and the reasons for choosing Substitute Teacher Services (STS) as their preferred outsourcing vendor.

At the meeting, I asked McDonnell for the names of the other four outsourcing vendors and he was unable to remember the complete list. I do recall Kelly Services was one option however; the services and fees of the other vendors were not presented to the public.  I asked McDonnell if we could assume that STS was the low bidder at a rate of 22.5%.  Although McDonnell responded that the District was not required to accept the low bidder because no RFP (Request for Proposal) was required, he did offer that STS was indeed the lowest bidder. McDonnell further stated that the 22.5% was a negotiated rate, down from 34%.

Tiede, McDonnell and Waters repeatedly told audience members that STS would provide a great opportunity for our employees, that they would make more money with the outsourcing company, have the ability to contribute to a 401K, keep their same jobs and on and on.  We heard that even though STS was the largest employer of its type in the country, that the District would retain complete control over who worked in our schools and that interviews would be conducted on site, etc.   Waters volunteered that an administrative employee of STS would actually have an office in the administration building! In other words, the public sales pitch of STS knew no bounds.

During the District in-service training for aides and paras today, Waters announced that STS is no longer involved in the proposed outsourcing, stating that the company had pulled their proposal.  Eight days since the School Board meeting and the preferred outsourcing vendor is no longer a consideration and that replacing STS is CCRES (Chester County Regional Education Services).  Why the change … this made no sense to me.  Little over a week ago, the Administration led the community to believe that STS was the best fit for the employees and that the company offered the most experience and maximum cost-savings to the District.

Absent any details from the School Board or the District to explain this outsourcing vendor change, I contacted STS and spoke for 45 min. to Jay Godwin, the president of STS.  Although Godwin would have liked to work with the TE School District, his decision to remove his outsourcing proposal was two-fold.

The first reason that Godwin offered for withdrawing his proposal was the School Board’s decision to delay the vote on the outsourcing plan until June 17.  Godwin did not believe that there is adequate time between June 17, the earliest date that the Board could approve the outsourcing agreement and July 1, the start date of the agreement to meet all the necessary State documentation requirements.

According to Godwin, Pennsylvania state law requires school district employees provide certain documentation, including Act 34 (Pennsylvania State Police Criminal Background Checks), Act 114 (PA Department of Welfare Child Abuse History Clearance) and Act 151 (Child Abuse History Clearance). Unless TESD employees had this required background checks within the last year, all necessary background checks, etc. are required.

When asked, what he thought the adequate time frame to accomplish the necessary ‘paperwork’ to move 175+ employees to an outsourcing plan, his response was 3 months. Had the School Board approved the outsourcing plan at the May 13 meeting, although less than his preferred 3 months time frame, Godwin felt he could accomplish the task.  However Godwin was of the opinion that a 2-week turnaround timeline was not possible for his company,  STS. He was unwilling to say whether another outsourcing vendor could meet that 2-week requirement.

The second reason for withdrawing the STS outsourcing proposal was based on TE School District  resident and employee sentiment.  Godwin was overwhelmed by the anti-outsourcing feelings of the public and the employees.  Typically, when a school district is considering outsourcing, there is a longer timeline for public discussion. The District plan to outsource the aides and paras took the residents, parents and employees off guard; and was met with swift and immediate opposition. If you couple the short timeline with misinformation and inaccurate budgetary numbers from the District, the reaction should have come as no surprise to the School Board and Administration.

As much as Godwin wanted to be a part of the TE School District, he said that he knew there would be unhappy employees and an unhappy community, and that was something that he did not want for his company.  Based on the sentiment of the residents (and employees, many of which are also residents) Godwin is of the opinion that this “is not the time for outsourcing in TE”.    Godwin has worked with many school districts and the  community’s anti-outsourcing response is the loudest and most significant he has seen in his career.

We discussed the uniqueness of TE School District and the education and background qualifications of our current aides and paraeducators.  Godwin acknowledged that the high level of education and commitment of these employees was not typical and would probably not be achievable by an outsourcing company.  I do believe that Godwin intended to hire all our current TE School District employees – I think that he truly understood their value and credentials.  Personally, I think Godwin feared that he would lose many of our current TE employees if the District outsourced and, may have been concerned whether he could replace them with the same high standard.

Godwin and I discussed how helpful it would have been for the outsourcing company (in this case STS) to meet with the aides and paras before the School Board meeting.  Such a meeting would have given the employees an opportunity to ask questions, voice concerns, understand the benefits, healthcare, etc. etc.   School Board and Administration transparency was discussed, with Godwin agreeing that an issue as important as outsourcing needs all options thoroughly vetted, and discussed in public, as part of the decision-making process.  Godwin was forthcoming and extremely willing to answer all my questions — his candor much appreciated.

Based on my conversation with Godwin, I am left with many questions including:

  1.  If the School Board approves the outsourcing plan on June 17, how is it possible for any outsourcing company to meet the deadline of July 1?
  2. If STS was the preferred vendor offering the best cost-savings to the District, where was CCRES on the ranking?
  3. How does CCRES propose to complete the necessary background checks, etc. within 2 weeks, should they receive the contract?
  4. The Administration is not meeting with CCRES until tomorrow, when will the aides, paras, substitute teachers be given the proposed plan?
  5. When does the School Board intend to explain that STS, the preferred outsourcing vendor has withdrawn their proposal?
  6. Presumably the fee schedule, cost-savings, benefits change with a new vendor, when is the public given this information?

The taxpayers deserve to know what is going on in this District. Where is the leadership of the School District?

Following the last School Board meeting, I sent two emails to School Board president Kevin Buraks. The emails voiced concern on two topics – my opposition to outsourcing of aides, paras and substitute teachers and the issue of intimidation by the Administration towards the employees of this District. My first email ended with the following, “You must lead … the employees of the District deserve your support, they need your help.  It is no longer acceptable for District employees to live in fear of their jobs.”

I closed my second email to our School Board president with, “We need governance, we need leadership.   To say nothing and to do nothing is not an acceptable solution.”

For the record, there has been no response from Mr. Buraks.  Today is Primary Election Day and Kevin Buraks is on the ballot seeking re-election.

Outsourcing analysis by TE School District does not stand up to public scrutiny – decision ‘on hold’

Taxpayers, teachers, PTO presidents, paraprofessionals, parents, substitute teachers, TENIG members and students brought their collective voices to the School Board meeting last night, and were heard, at least temporarily.

Standing three people deep and overflowing into the lobby, all attended the meeting for the singular purpose to oppose outsourcing of paraprofessionals in the TE School District.  For over three hours, one voice after another was echoing the same message to the School Board, “don’t outsource.”  For the record, not one person spoke in favor of the District’s proposed outsourcing plan.

With Fox News and ABC Action News filming most of the proceedings,Board members, District business manager Art McDonnell, personnel manager Sue Tiede and Superintendent Dan Waters repeatedly claimed that many of us had misunderstood and that the third-party outsourcing to STS would actually help ‘save’ the jobs of District aides and paras.  They wanted us to believe that STS would hire all the displaced TE employees and that our employees would be making more money working for STS.

According to McDonnell, the need for outsourcing is based on the Affordable Care Act (ACA) and the cost to provide healthcare for the aides, paraeducators and substitute teachers working 30 hours or more per week in TESD. These employees have never received healthcare coverage through the District.  McDonnell claimed the annual cost to provide healthcare coverage to these currently uninsured District employees would be in excess of $2.3M and further citing a potential fine of $1.2M annually for noncompliance.

By the time the last person had spoken out about outsourcing, it was abundantly clear that the District and the School Board had many more questions than answers.  McDonnell had predicated his evaluation of the healthcare coverage costs to the District on all 175 employees needing insurance.  As was repeatedly pointed out, most of these employees have insurance through their spouses and do not need the coverage.  The District’s cost to insure was based on all 175 employees working 30+ hours per week which had many in the audience asking why not reduce their hours (so the District would not be affected by the requirements of ACA).

Several residents spoke of personal experience with the Affordable Care Act and its requirements.  One in particular, a CFO for a local corporation, offered that the District’s analysis was incomplete and inaccurate, and suggested the Board seek healthcare benefit expertise so as to make an informed decision. Example of inadequate District analysis — The Affordable Care Act does not stipulate that the healthcare coverage must be the same as offered to the teachers and administrators.  Rather than plugging in the cost for a ‘basic’ healthcare coverage in their outsourcing analysis, the McDonnell used the cost of the Cadillac-type of healthcare coverage of the administrators.

The most striking comments of the evening were from those who had called the proposed outsourcing company, STS to learn about the company and their employment requirements.  They were told that STS employees only need graduate from high school, or a GED will suffice. (Remember all the aides, paras and substitute teachers working in TE have 4-year degrees and many have Master degrees). When asked if any additional training was needed to serve as a school district paraprofessional, the response from the company HR — was one evening of their STS Academy training (!).  One young woman in the audience spoke last night who works for TESD but is also a STS employee.  She explained STS hiring procedure and the shocking revelation that STS hired her with no interview required.

Personnel director Sue Tiede repeatedly countered the low employment standard of STS that should District use this company, they would be required to meet the TESD requirements.  We also learned that STS has no experience with this type of job outsourcing.  Although McDonnell and Tiede offered that a couple of Lancaster County school districts employ STS, we learned quickly from audience members that these contracts were only recently signed … therefore leading to the speculation that our award-winning school district would serve as the company’s outsourcing guinea pig.

Facing many unanswered questions from audience members and an outsourcing analysis that did not stand up to public scrutiny, at 11:20 PM, the School Board voted unanimously to table the discussion of outsourcing for the night.  By the Finance Committee meeting on June 10, the administration and the Board will seek a better understanding of the Affordable Care Act (and its requirements) plus work to answer the many questions and possible solutions offered by the public last night.

Are Dan Waters and the TE School Board planning to outsource without public discussion?

In advance of tonight’s School Board meeting, all  aides, paraeducators and paraprofessionals working in the TE School District received the following Q&A Fact Sheet this afternoon from Dan Waters.

Is the message to the District employees and the taxpayers supposed to be — don’t bother to show up tonight with your questions because the District and the School Board has already made up its mind on outsourcing?  Where’s the public discussion?  Don’t the opinions of the residents in this District count for anything?  We elected these nine School Board members to represent ‘US’ — where’s our representation!  

According to the email from Waters,  the Board has received 31 emails from people that misunderstand the outsourcing plan.  Why do you suppose that people misunderstood?  The only time I know that the outsourcing  ‘plan’ was ever discussed was at the Finance Committee meeting and I can tell you that the School Board did NOT know all the answers.  We were told that outsourcing did not have to do with the Affordable Care Act, yet in this Q&A, it states that as a reason.  It was clear at the Finance Committee meeting that the District CANNOT and WILL NOT mandate that STS hire the TE paraprofessionals.  It was specifically stated that all the District could do was ENCOURAGE the hiring of the the TE employees.   Read the PR statement from the District and they would have us believe that it’s an absolute that the employees keep their jobs.

Is the intention of this email from Dan Waters to intimidate aides and paraprofessionals from speaking out tonight?  

Is the intention of the email to silence TENIG members because they are next up for outsourcing?

Is the public supposed to be intimidated by Dan Waters, Art McDonnell and the 9 School Board members?  Are we not entitled to ask questions and receive answers?  

Any misunderstanding of the outsourcing plan is completely ‘by design’ by the District … keep us in the dark, with limited information.  Give us ‘fuzzy math’ and tell us that the District is saving money.  Promise aides their jobs when they get outsourced but privately know there’s no guarantee.  Tell the paraprofessionals that they will make more money because they get to keep their 7.5% pension contribution.  If people in this community want a ‘voice’, they are going to have to show up tonight and claim it!

This draft Question and Answer Fact Sheet was prepared to be sent to affected employees if the outsourcing of the work of aides, para-educators and paraprofessionals was approved at this evening’s School Board meeting. As of this time, the Board has received 31 emails with a common misunderstanding of the plan. The following Fact Sheet regarding the transition to STS as the employer describes the District’s plan for outsourcing this work while accomplishing the Board’s goal to maintain our current aides, para-educators and paraprofessionals in their current positions.

Dan Waters
Superintendent of Schools
Tredyffrin/Easttown School District

Questions and Answers regarding Transition to  Substitute Teacher Service, Inc.

The District appreciates the work of the support service personnel in assisting our children to succeed. This shift to Substitute Teachers Service, Inc. (STS) does not diminish your contribution to the students which is appreciated by all. The budget strategy was delayed for the past three years, but the state-required increase in the District’s contribution to the PSERs fund and the implementation of the Affordable Care Act require this shift of the work to an outsourcing management company. We encourage you to attend the STS transition meeting to begin the process of employment with STS at TESD.

1.  What was the District’s motivation in making this change?

The District’s motivation is to retain current employees in the same building with the same hours while increasing the typical aide, para-educator or paraprofessional’s total compensation.

2.  Why is the District doing this now?

The Affordable Care Act is now law. The aides, para-educators and paraprofessionals were not eligible for healthcare benefits in the past. With the implementation of the Affordable Care Act the District would have to reduce aide, para-educator and paraprofessional hours below the 30 hour threshold which requires that healthcare benefits be provide to employees who work for school districts.

3.  What is the District’s goal for outsourcing the work of the aides, para-educators and paraprofessionals?

Outsourcing the work of aides, para-educators and paraprofessionals has been considered as a budget strategy for the past three budget years by the Board.  The goal of the strategy is to maintain the current personnel with comparable hours within a long-term financially sustainable budget. The mandatory PSERS increase as a percent of  salaries for individuals employed by the District, along with the implications of the Affordable Care Act, coupled with declining revenues made it necessary at this time to implement outsourcing the work of the aides, para-educators and paraprofessionals.

4. Will the current employees in these roles be offered the opportunity to keep their current positions next year while working for STS?

Yes. The goal of the strategy remains that current employees whose performance is deemed satisfactory will be encouraged to accept the opportunity to be hired by STS.

5.  When will STS become my employer?

The contract with STS begins on July 1, 2013. Your work year would follow the typical schedule and would begin with the start of school in the fall of 2013.

6.  The Board approved contract with STS begins July 1, 2013. Will I be separated from employment by the District before being hired by STS? 

Yes. In June, all aides, para-educators and paraprofessionals will have their employment with the District ended. The separation will appear for Board action in the June 17th Board agenda. The employee will be given the opportunity within the next few weeks to meet with STS and begin the STS employment process. Again, the goal of the District strategy is to transfer the management responsibility to STS, while maintaining employees in their current roles at TESD.

7.  When would I begin working as an employee of STS? 

It is the District’s desire that our current support staff members will return to their assignments in the District in the fall as employees of STS.

8.  What do I need to do to be hired by STS? 

You will be invited to attend a transition meeting with the District and STS.  This meeting will be held at a District school to be announced.  At this meeting, you will be able to begin paperwork to become an STS employee at TESD in the fall of 2013.

9.  Will I need to provide new clearances and a TB test to be considered for employment by STS?

Yes.  These are state mandated forms and the STS employee is responsible for the cost.

10.  Since I will be separated from the District and will not receive a reasonable assurance letter to return to work in the fall of 2013 as a District employee, am I eligible to apply for unemployment compensation during the days I am not employed in the summer? 

Possibly yes. Depending upon the extent and nature of any work you perform over the summer, you may be able to choose to apply for unemployment compensation for the days you are not employed by the District in the summer.  If you are uncertain about your unemployment compensation entitlement, you may file for unemployment benefits with the Unemployment Compensation Bureau. The District will not file for these benefits on your behalf.

11.  Will my current paid holidays be changed in the first year when I am employed by STS? 

You will continue to have 10 paid holidays per year and 2 paid floating holidays in the 2013-2014 school year when you are assigned to the T/E School District as an employee of STS. The floating holidays earned during 2012-2013 but not used will be paid out in June 2013 as is our practice.

12.  What will my paid sick time allotment be in the first year when I am employed by STS? 

STS will provide you with 10 paid sick days during the 2013-2014 school year.

13.  Would my assignment next year be at the same school with the same total hours per week if I am employed by STS?

Generally speaking, yes.  Typically, we have some employees who work in new locations each year; however, most support personnel return to the same building for the same total hours as they worked in the previous year.

14.  What will my total compensation be as an employee of STS? 

The total compensation as an STS employee includes a reduced hourly rate of approximately 12%; this new rate will not require a 7.5% employee contribution to PSERS; the employee will have the ability to choose to file for unemployment compensation benefits.  This new annual total compensation may be the same or greater than it had been as a TESD employee, because the PSERS contribution is not required and you may choose to file for unemployment compensation.

15.  What about the PSERs retirement funds that I have accrued? 

The District will arrange to have a representative from PSERs present a seminar on this topic to separated employees.  This PSERs seminar will be held in the District, as soon as possible.  The goal of this PSERs seminar is to provide employees with information which will assist them in making an informed decision about their PSERs account once they are no longer employed by the District.

16.  As an STS employee will I be required to use KRONOS? 

Yes.

17.  Will my hours be reduced as an STS employee? 

Generally speaking, no.  Most STS employees will work the same total hours as in the previous year. A few STS employees may see adjustments in their hours due to needs at the various buildings.  These personnel hour adjustments happen annually for certain employees.

18.  Does STS provide access to employees for a self-funded retirement savings fund? 

Yes, STS will provide the employee with access to a 401(k) type of retirement savings program. This 401 (k) type retirement savings program is funded by the employee, not by STS.

19.  Will STS provide any medical benefits to the employees?

No. The current TESD aide, para-educator and paraprofessional are not eligible for health care coverage. The same will apply to STS employees.

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