TEEA Tredyffrin Easttown Education Association

Surprise — T/E Reaches Tentative Early Bird 3-year Contract Agreement With Teachers — Didn’t Know Negotiations Were Underway

Who knew?  Interesting that the public found out on Friday that our school district has worked out a tentative early bird contract with the teachers union – the current contract with TEEA runs to June 30, 2020. The public was not informed that negotiations were underway, let alone that they are complete and the school board will vote on the tentative three-year contract on Monday night (seven months before the existing contract ends).

Question for the school board, where’s the transparency? In the past, the public was at least notified that the contract negotiation process was underway. So who is representing the public at the negotiating table? Which school board directors? Or … is this another case where all roads lead back to the District’s business manager and he is our chief negotiator?

Just a few short weeks ago, leading up to Election Day, some school board candidates spoke of increasing public communication and transparency. Not sure that telling the public afterwards that you have an early bird teachers contract ready to be signed can be viewed as transparency.

With the school board voting on the tentative TEEA contract tomorrow night there is a small window for the public to review – thanks to Ray Clarke for the following analysis! Much appreciated!

A surprise on Friday evening along with the Agenda for Monday’s School Board meeting – a proposed new three year contract with the TEEA.  In essence, base salaries will increase 1.5% every year, teachers below the top step will move up a step every year, and the District and employee contributions to benefits costs will remain the same.

This is a significant improvement for the TEEA over the last contract, which contained base salary increases of 0.5 to 1.0% and an increased employee contribution to healthcare premiums. 

The district did not provide the contract or any underlying detail – teachers have to ratify the agreement before taxpayers can see it.  However they provided a set of statistics:

 – The agreement commits 65% of the Act 1 Index

– Individual annual salary increases range from 3.5% to 3.0% over the 3 years

– The net expense increase is about 1.7% of the total district budget

No surprise, it’s difficult to see how all these can be true, even with herculean assumptions about healthcare cost inflation, PSERS projections, retirements, distribution of teachers on the matrix, etc.  Those with time on their hands can try to reconcile them (given that, per 2019/20 budget workshops, TEEA salaries were budgeted at ~$46 million, real estate tax revenue at ~$115 million and total expenditures ~$150 million.  The Act 1 Index for 2020/21 is 2.6%.

If the Administration provided any detail or had earned any trust maybe we would not have to wrack our brains to figure this out.  I wonder if the Board will ask any questions about a contract for one third of the expense base that seems to consume at least two thirds of an Index tax increase that is already the highest since the 2.9% in 2010/11?  How will other expenses be contained to offset this?

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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.

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T/E School District: Surplus $3.9 Million in 2011/12

Ray Clarke attended T/E School District Finance Committee on Monday night and provided his notes for Community Matters readers.  After reading his notes, I spoke with Ray for clarification as I could not quite believe what I was reading.  The 2011/12 actual expenses of the T/E School District were $5.5 million less than the District forecasted in June 2012. The District revenues were also less than the June 2012 forecast.   Factor in the reduced expenses and reduced revenues and the District has a surplus of $3.9 million in 2011/12.  Wow!

How could it be that the District financial forecast was off by nearly $4 million!  We knew that the change in the medical insurance would be a cost savings but it is surprising that the surplus was so significant. The District has added the $3.9 Million to the General Fund Balance.

Ray’s Finance Committee Notes:

Monday’s Finance Committee meeting was most notable for a review of the full year 2011/12 finances in conjunction with a presentation of the draft audit.  It turns out that a number of things broke in favor of the district.

The table below compares the forecast for the full year 2011/12 when 2012/13 budget was approved in June with the actual outcome and with the 2012/13 budget (figures in $ million, rounded)

                                    11/12 Forecast          11/12 Actual       12/13 Budget

Revenues                     106.4                            105.6                109.2

Expenditures                107.2                            101.7                110.3

Budget Imbalance         (0.8)                            3.9                    (1.1)

So, expenses for the year to June 2012 turned out to be $5.5 million less than forecast in June 2012. (And about that amount less than budget).

Administration provided detail of the major drivers of the saving versus budget:

  • Lower Healthcare benefits:      $1.8 million
  • Fewer teachers:                           $0.4
  • Lower tuition reimbursement: $0.3
  • Less natural gas usage:              $0.4
  • Transportation savings:             $0.3
  •  “Breakage”                            $0.8
  • Other salary savings:                  $0.3

         Total                                          $4.3

“Breakage” is cost saving due to unexpected retirements, resignations, etc.; replacements are likely lower cost and there can be interim cost savings.

Clearly the final benefits accounting takes a while, but it seems quite likely that the 2012/13 budget and associated tax increase might have been predicated to at least some extent on an artificially high baseline.  As Neal Colligan pointed out to me, there needs to be strict oversight to ensure that the current year expenses do not inflate by a whopping $8.6 million to the budgeted $110.3 million.

The $3.9 million surplus goes into the now ~$25 million general fund balance, with the $1.8 million benefits saving planned to be committed to medical plan rate stabilization and the remainder to the ever-open PSERS rate stabilization fund.  On that score, it was announced that there’s a new GASB requirement that in 2015 districts  must recognize on their balance sheet their share of the $27 billion unfunded PSERS liability.  (Perhaps someone can work this out for TE, based, say, on TE’s % of teachers and a 50% share of the liability?).  [Note also that in the year to June 2012 PSERS returned 3.4% compared to the 7.5% built into the system’s accounting used to calculate that $27 billion].

And this continues on to the 2013/14 budget, which will be rolled out at the next Finance Committee meeting on December 10th.  It looks like we need to step up efforts to ensure that votes for tax increases are based on realistic projections.

On other matters, the Board continues with plans to harass tax-exempt non-profits.  An outside attorney is being used to review and identify property owners that will be sent a letter and questionnaire to confirm tax exempt property use in the light of changes in the state law.  This letter and questionnaire will be discussed at the January Finance Committee.  The Committee has already determined that the a large percentage of the total are parcels owned by government entities (like the district itself) and for rights of way.  Also, the district is planning to extend for six years the transportation agreement with Krapf; as presented, the terms looked reasonable.

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