Tredyffrin Easttown Education Association

School Board Members to Join T/E Contract Negotiating Team

Last night’s School Board meeting represented a distinct shift in attitude from the School Board directors in regards to the teacher negotiations.  Since the District named their negotiating team last January (Dan Waters, Sue Tiede, Art McDonnell and professional negotiator attorney Jeffrey Sultanik), I have been very vocal in my concern that there was no school board director serving on the negotiating team.  I was of the opinion that the residents of TESD elected the school board members to serve them and at least one of them needed to sit at the negotiating table.

Without representation by a school board director, the reporting process had the appearance of a ‘whisper down the lane’.  I understand that Sultanik was hired to negotiate at the direction of the School Board, but I think that the Board’s public appearance of ‘hands-off’ to the process, may have added to the strife with the teachers.  The information and the updates that the school board receives were not by firsthand attendance at the meetings, the flow of information was from one of the four members of the negotiating team.  I am not suggesting that the District intentionally mislead the public through its updates, but I was of the opinion that without a seat at the table, it was possible that subtle nuances that occur in a meeting could be missed in the translation.

But here is some good news for anyone that shares my concerns with the negotiation process.  At the end of last night’s meeting, Board president Karen Cruickshank gave a brief update on the status of the teacher contract talks.  She explained the District has made another offer to the teachers and offered hope that a resolution could be forthcoming.  Not certain what is contained in the latest offer but there was something else … Cruickshank announced that going forward, school board directors would have a seat at the negotiating table.   Karen Cruickshank, Pete Motel, Kevin Buraks and Betsy Fadem will join the negotiating team at all future meetings with the teachers union.  I believe that this was the right decision for the District, the residents and for the teachers! The last few months have been contentious between the two sides, but I think this latest decision represents an encouraging sign.

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Given Our Economic Times, How Can T/E Afford A Real Estate Purchase?

Here we are nine days and counting until school starts, in the midst of contentious teacher contract negotiations and parents in the District hoping that school starts on time.  Residents have repeatedly been told that T/E School District cannot afford the demands of the teachers … escalating health care and pension costs.  With decreasing revenues and rising costs, in June we witnessed, as tough decisions were required to balance the District budget.

During the discussion on the Fact Finder’s report at the August 20 special School Board meeting, school board members weighed in on why they could not vote in favor of the report.   Karen Cruickshank, Board president, commented in part,

“… The public knows how hard the Board has worked to balance the budget over the past 3 years.  We have explored ways to increase revenues.  We’ll be charging students an activity fee for the first time this year. We have raised taxes 2 years in a row to the Act 1 limit with allowable exceptions to referendum. We have cut $10 million from our budget, or one tenth. We have held administrators, aides and paras at zero raises over the last 3 years. The members of TENIG agreed to a 4.5% cut last year. The custodial staff has agreed to waive both the 4.5% increase for next year and has given back an additional 10% of current salary. The numbers still don’t balance. It is the responsibility of the Board to balance the budget. The Board has no control over large increases in state mandated pension obligations put in place by the legislature in 2001. The District has also suffered significant financial losses through commercial and residential real estate reassessments and tax appeals. These reassessments and appeals have resulted in the likely loss of $1.5 million this year. These factors together have wreaked havoc on what was once a stable T/E budget…”

For the most part, I think that residents are starting to recognize the economic problems facing the District and the importance of School Board members to make responsible and sound fiduciary decisions. It is because of this, that frankly I was astounded to see a specific item listed under the ‘Consent Agreement’ on the agenda for the School Board meeting, Monday, August 27. According to the agenda, a ‘Consent Agenda’ requires Board action but “… it is unnecessary to hold discussion on these items. With the consent of all members, they are therefore grouped and approval is given in one motion.”  

There are probably 15 or 20 consent agenda items listed on Monday’s agenda, ranging from approving minutes, and acceptance of gifts to ‘purchase property’.  All of these consent items are lumped together and then rather than going through them item by item, approved by the School Board in one motion.  The purchase property item caught my attention but I had to read to page 45 of the agenda’s supplement materials to find the following:

Consent VII, E, 3:Purchase of Property

“That the Board of School Directors authorizes the Superintendent to execute, and the Board Secretary to attest, and deliver to the record owner of property designated as Tax Parcel No. 43-10L-2 [which is property adjoining the District’s property], the Agreement of Sale in the form attached to the resolution…….”

The agreement of sale that follows further identifies the property as 892 Old Lancaster Avenue, the seller as the Estate of Arthur Fennimore, and the price as $265K.  The date of sale is left blank.  On Saturday morning, I stopped by the property to take a photo and spoke with the grandson of Mr. Fennimore.  He and his brothers were cleaning out the house in advance of the purchase by TESD.  Mr. Fennimore was 97 when he passed away and was the original owner of the house. According to the grandson, closing between the Estate and TESD is expected by the end of the week.

I have attended most, if not all, of the 2012 School Board meetings and have absolutely no recall on the discussion to purchase additional real estate property, …  especially given the agonizing budget decisions, the possibility of demotion and the contract negotiations with the teachers.  Therefore, I don’t think that I missed the discussion about purchasing additional real estate.

This past Friday there was a Facilities Committee meeting and although I did not attend, according to the agenda there was no discussion about the upcoming purchase of the Fennimore property. To be clear, in the past, there have been on/off discussions about the maintenance building and the need to expand the storage facility.  In fact, there are existing architectural plans —  but as far as I knew, the project was ‘on hold’ for obvious economic reasons.

The Fennimore house is the last remaining property between the current maintenance building and T/E Middle School on Old Lancaster Rd. – the District previously purchased all other properties.  So … I guess from an overall planning standpoint, the acquisition of this property makes sense.  However, given the District’s current economic climate and the unsettled teachers’ contract, it would seem that the topic to ‘purchase’ would still require some discussion, not just buried with 20 other consent items.  Unfortunately, the word that immediately comes to mind … transparency, or rather ‘lack thereof’.

Based on my conversation with Mr. Fennimore’s grandson, the estate has a deal with the school district and that closing and settlement will occur later this week. Given that there appears that there will be no discussion about the School Board’s decision to purchase the property, here are my questions …

How did they arrive at the price for the property?  The sale price is listed as $265K.  My friend Ray Clarke did the research and determined that the assessed value is $129,500.  According to Ray, if we “… multiply $129,500 by the current Chester County Common Level Ratio of 1.70, you get $220,150.”  Subtract $220,150 from $265K, and you have to ask, why is the School District paying a $45K premium for this property.  Regardless of future development plans, for the time being, the District will need to tear down the house, which means an additional expense.  Another question — is the maintenance-storage facility project still on the back burner or does the Fennimore house purchase have the timetable moved up on the construction project?

Some may suggest that a $265K real estate purchase in the T/E School District is a ‘bargain’ and a ‘smart’ move for the District in these depressed economic times.  But the bottom line for me, is $265K really such a bargain for a property assessed at $130K?  And what about the public – do we deserve an explanation about the purchase?  What is the plan for the acquisition? And if there is a plan, how much will that plan cost? 

I have the questions, but it doesn’t look like there will be much in the way of answers.

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Will T/E School District Open Without New Teachers Contract

Now that the 2nd vote on the Fact Finder report is behind us, it is my understanding that the school board and the teachers return to traditional method of negotiations.  As the clock ticks down the remaining days of summer vacation, can we assume that schools in T/E will open on schedule.  It is my understanding that until there is a new contract; the teachers will continue to work to the terms of their expired contract.

But how long can the T/E school district budget afford for the teachers to work to the old contract?   

The Neshaminy teachers and the school district have been locked in a vicious contract debate for 4+ years with neither side willing to budge – sticking points in the bitter contract dispute is healthcare and salary.  It is my understanding that the teachers want a 5% salary increase retroactively for the last 4 years.

As I wrote in January of this year, the teachers in the Neshaminy School District are the highest paid in the state but if we look at PSSA results, the Neshaminy School District doesn’t even make the top 50 in the state, coming in at number 245 among Pennsylvania’s 500 districts.  Over half of the Commonwealth’s school districts have outperformed Neshaminy on PSSA tests for the last 10 years.  Compare that to Tredyffrin Easttown School District and the ranking of third in the state.  If the highest paid teachers, working in a school district that underperforms 50% of all other school districts in the state, are willing to strike twice in 6 months … what does that mean for other districts with teacher contracts pending?

Lower Merion School District is in a similar situation to TESD.  Lower Merion’s teacher contract expired the end of June and the 1,300 union members are working ‘for now’ under the provisions of the old one.  With school scheduled to open on Tuesday in Lower Merion, the School District officials and the union are set to negotiate tonight to see if they can settle.

Most people who I have spoken with do not believe that our teachers will strike in TESD.   I am not sure what is to be gained by a teacher strike, aside from many aggravated parents.  Or is it possible that teachers can be pushed to a point where they feel this is their only option?

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T/E School Board: 2nd Vote Not to Accept Fact Finders Report

Last night was both the Board of Supervisors meeting and the special meeting of the school district.  I attended the BOS meeting and Ray Clarke attended the TESD meeting and kindly provided his personal notes of the meeting.  Although we should not be surprised that the school board rejected the fact finders report a second time, in speaking with Ray I am troubled by something that happened.  Now again — I was not there so if my interpretation is incorrect, someone please correct me.

It appears that there was a heated exchange between Sultanik (the negotiating attorney hired by TESD) and Laura Whittaker, the  teacher union president.  Apparently it is OK for Sultanik to make public claims against the union but Ms. Whittaker is not allowed to defend her position.  Why?  Because although Ms. Whittaker is a TESD teacher, she is not a T/E resident.   Regardless of which side you support (TESD or TEEA)  this does not seem fair.

I understand the economics of the school district, but that does not give Sultanik the right to disrespect the teachers and then offer no option for them to defend.   These people teach our children, are they not entitled to respect?  The school board has a policy that non-T/E residents are not permitted to comment at school board meetings and I appreciate that if there is long line of people waiting to comment, that it is fair that residents be permitted to speak first.  Regardless of the union, TENIG, TEEA, etc. I am of the opinion that the union president representing his/her members should be permitted to speak at school board meetings, without a ‘residency’ requirement.  I am not saying all the non-resident teachers, custodians, etc. just the presidents, should they be non-residents.

Again, I did not attend the meeting and would certainly appreciate the opinions of other who did attend.  Bottom line for me … I want both sides fairly represented but I don’t like the idea of public ‘dressing-down’ from  either.  Here are Ray’s notes:

The School Board took advantage of the forum offered by tonight’s Board meeting to present their side of the contract negotiations and to outline the details of their three year offer suggested at the last Board meeting.  Unfortunately, perhaps, they felt the need to rebut the TEEA week-end comment that “School board members have not met with us….” with Mr Sultanik recounting a minute by minute list of the emails between him and the union’s Ms Waldie, during which an offer to meet was repeatedly made, and which did in fact lead to a meeting of the parties on August 15th.  At that meeting the Board presented their proposal, to which – according to Sultanik – the TEEA has not officially responded.  There were shouts of “You lie!” or similar from the audience, but Ms Whittaker, not a district resident, was not permitted to speak.

Here’s the essence of the District proposal:

– Freeze matrix, step and column positions for 2 years.  One step and column movement halfway through Year 3

– One time $2,500 bonus for all teachers in Year 2 and one time $1,000 bonus for all teachers on the top step in Year 3

—  Sizable incentives that do not build in recurring expense (use of the fund balance!)

– 189 day calendar in Years 2 and 3, down from the current 191 days

—  Locking in the 2 furlough days (1% salary reduction) in the Fact Finder report

– Two health plans with family coverage with premium share rising from 9-10% to 11-12% in Year 3.  The individual dollar cost for the most expensive plan is projected at $1,743  to $2,531, compared to $1,020 under the current plan.  A $50,000-$60,000 copay pool in Years 2 and 3 if the higher cost healthcare plan can be dropped due to less than half the employees selecting that plan.

— The national average for premium share is 29%

   — There’s a tax provision that allows employees to deduct their premium share, reducing the net cost by their marginal tax rate

– A cap on tuition reimbursement of $150,000 in Years 2 and 3 (compared to $290,000 under the current MOU and $650,000 last year)

– Radnor and Lower Merion have introduced caps on tuition reimbursement

– Prescription copays as in the Fact Finder report

– Demotions allowed for economic reasons in Years 2 and 3

– Settlement of outstanding grievances, particularly re the CHS 6 period day

— If ruled in favor of the union would require the hiring of 12 additional FTE at a cost of $1.2 million a year

Sultanik stated that the deadline for a TEEA response is August 27th at 12 noon.  It’s not clear if that is a mandatory deadline per the law, but it could be, since the process is still under the aegis of the state arbitrator and law does require continuation of the negotiating process.

Art McDonnell presented two slides that provided the current status quo budget/3 year projection and the Fact Finder report.  As presented, the Fact Finder report reduced the Year 1 and 2 deficits by about $300,000, but the year 3 (and 4) deficits increased by the same amount.  He did not show how the latest Board proposal would stack up under the same model, but in response to my question there were general comments from the Board that the deficits would still not be eliminated under likely tax scenarios.  (I think that there may be enough data to model the impact ourselves, and with some time over the next couple of days I’ll take a shot at that, but it will be difficult to account for all the inter-relations of salary, PSERS, etc.)

Ann Crowley and Kris Graham explained their August 9th votes to accept the Fact Finder report largely on the basis of expediency and on the intangible impact of an unsettled contract on home values, teacher stress, need for students to continue to out-perform, and so on.  Mrs Graham thought there was now benefit to the teachers to get the 3 year deal and so changed her vote tonight, in order to get the parties back to the negotiating table.  Mrs Crowley abstained from voting in protest of the email litany recounted by Mr Sultanik.  Dr Motel reminded the audience that salaries for all other employees have been flat for three years, and at some point increases may need to be found.  President Cruickshank also noted this and the give backs from TENIG employees and separately custodians.   She noted that the Board has to balance the budget and recounted the last three years total of $10 million expense cuts, maximum tax increases and falling real estate assessments.  Remaining options are to cut kindergarten, transportation and extra-curriculars.  She made a plea for “two austere years to right the financial ship”.

The Board voted 8 to 0 with one abstention to reject the Fact Finder report.

The audience seemed to be largely teachers, with little public comment.  Andrea advocated rationalizing the healthcare benefit craziness by providing a defined contribution rather than a Blue Cross-specific defined benefit; another resident supported the Fact Finder report on the basis of retaining qualified teachers and supporting property prices.  ABC News was there, also.

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T/E Teachers Union Appeals to School Board to Accept Fact Finder Report

President of Tredyffrin Easttown Education Association (TEEA Laura Whittaker has released the following appeal in advance of Monday’s TESD vote on the Fact Finders report.  The statement urges the school board to vote to accept the report at the special meeting.  Whittaker claims that the school board has not moved from their original position of last February although TEEA has offered “significant financial sacrifices”.

The clock is ticking down to September 4, the first day of school.  If the school board does not vote to accept the Fact Finder’s report, is a teachers strike on the horizon … ?  

Board’s decision to reject impartial Fact Finder’s report further exposes its inflexibility

Tredyffrin-Easttown Education Association President Laura Whittaker is calling on the members of the Tredyffrin-Easttown School District board to reverse their decision to reject an impartial Fact Finder’s report intended to settle the district’s expired contract with TEEA members.

In the fact-finding process, a neutral, third-party arbitrator reviewed the contract proposals of each side and made recommendations intended to settle the expired contract. The review took 40 days. Once the fact finder issued the report, each party had 10 days to accept or reject the fact finder’s recommendations.

The TESD board rejected the report at its August 9th meeting, and will vote again on the issue during its Monday, August 20, special school board meeting. The meeting starts at 8 p.m. in at the Tredyffrin-Easttown Administrative Offices.

TEEA members voted to accept the Fact Finder’s report even though it contained significant financial sacrifices on their behalf, including approximately $500,000 in lost wages, a reduction in health care benefits, and a loss of tuition reimbursement for professional development.

“School board members have not met with us, and they rejected the Fact Finder’s report without having moved from the original proposal they gave their negotiator in February.  They now have another opportunity to vote to settle this contract,” Whittaker said.

Whittaker urges all members of the T/E school community to turn out for Monday night’s school board meeting and make their voices heard. “Parents do not want their children’s education interrupted because of the school board’s stubborn inflexibility,” she said.

“If the board would be reasonable and accept the impartial Fact Finder’s report, it would assure that the school year can start on time and without disruption,” Whittaker said.

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T/E Teachers Union Weighs in on Fact Finder’s Report

Last night I received the following press release from Laura Whittaker, president of teacher union Tredyffrin Easttown Education Association (TEEA).

TEEA Votes to Accept Fact Finder’s Report, Asks for Community Support 

On Monday, August 6, the members of TEEA met to discuss and vote on the Fact Finder’s report. Acting as an independent third party, Fact Finder Mr. Timothy Brown carefully examined all of the issues in dispute as well as the District’s finances and revenue potential. By law, TEEA members were required to accept or reject the report in its entirety, and the membership voted to accept the report.

Under the provisions of the Fact Finder’s report, professional employees would be frozen at the current salary for a year and a half.  Association members also agreed to a choice between two less expensive health care plans as well as increases in premium sharing and prescription costs. The report linked no demotions of professional staff with a reduction in tuition reimbursement during the second year of the agreement, a provision that built upon the previously established Memorandum of Understanding which reduced tuition reimbursement in exchange for no demotions during the first year of the contract. Furthermore, the Fact Finder acknowledged the District’s desire for cost savings by allowing the District, in the second year of the contract, to furlough teachers for up to two full days with a corresponding salary reduction, a provision currently non-existent in any teacher contract in the state of Pennsylvania. TEEA estimates that the furlough days alone would cost TEEA members approximately $500,000 in lost wages.

“We are disappointed by the School Board’s choice to reject the report and stated efforts that they would like to continue bargaining,” TEEA President Laura Whittaker said. “By voting to accept the report, TEEA members have acknowledged the need for shared sacrifice. We believe that the report offers a fair and reasonable contract settlement. We urge members of the public to read the full Fact Finder’s report that is available on our website and ask the community to support acceptance of the Fact Finder’s report in order to reach a contract settlement so that we can all focus on the education of the children of the Tredyffrin-Easttown School District.”  The School Board will take their second vote on the Fact Finder’s report on Monday, August 20 at 8 pm at the Tredyffrin-Easttown Administrative Offices at 940 West Valley Road, Suite 1700 in Wayne.

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T/E Fact Finders Report — TESD and TEEA at Odds on Salary and Health Care/Insurance

The Fact Finder’s report has now been released (click here to read).  In a quick review of the report, salary and health care/insurance appear to be the issues of major conflict between the school district and the teacher’s union.  I offer the following summary and my personal remarks, but encourage you to review the report and weigh in with your own opinion.  The public has 10 days to review the Fact Finder’s report and then the School Board votes again on Monday, August 20.

Salary

District (1) proposes that as of July 1, 2012 freezing teacher’s salaries at the 2011-12 contract year level; (2) proposes that as of July 1, 2013, freezing teacher’s salaries at the level at which they were at the conclusion of the 2011-12 contact year; and (3) proposes no column and step movement during the term of the Agreement.

Union proposes (1) that for the 2012-13 freezing salary at the 2011-12 contract year and (2) for the second year, 2013-14 year, there will be column and step movement throughout the salary schedule and that those bargaining unit members at the top of their respective columns will receive a payment of $1,000 off-scale bonus.

Recommendation:  (1) 2012-13 freeze salary at the 2011-12 contract level and (2) for 2013-14 year, freeze salary for the first one-half of the school year at the 2011-12 contract level and for the second half of the year, there will be column and step movement.  Those bargaining unit members at the top of their respective columns will receive a payment of $300 off-scale bonus.

Health Care/Insurance

District proposes to make available health benefit plan to full-time employees (including full-time Health Room nurses).  I do not see a coverage option for employee’s spouses and/or dependents (even if the employee pays the difference).

Union proposes a shift to Personal Choice C2 health plan, which would include an increase in copays for doctor’s office visits.  Union also agrees to increase its premium share from the current 5% to 7% of premium costs in year one of the Agreement and 8% of premium share in year two.

Recommendation: The Fact Finder report took real issue with the District in regards to health care, stating, “… considering the realities of its financial condition, and its educational and financial goals, there is absolutely no good reason why this School District would not offer more than single medical insurance coverage for its teachers. … There is no defensible reason for this School District – this School District that is one of the richest and best performing school districts in the state – to champion any proposal that would pressure and weaken the families of the teachers who serve the District’s families; removing medical insurance coverage from the children and families of teachers would do just that and I cannot recommend such.”  The Fact Finder believes that the District should offer health plan options for teacher’s spouse plus children and family options, suggesting that the District will pay 90 -95% of the premiums and employees 5 – 10% of the premium based on Year One or Year Two of contract.

I’m not certain that I correctly understand the recommendation about ‘who’ is paying for the spouses and/or children of employees.  To be clear, I totally disagree with the District on the subject of health care insurance – employees need to be able to have an option of insurance coverage for their spouses and/or families.  It does not appear that the District offers that option.  Although I am of the opinion that employees should have their individual insurance covered, perhaps the employees should be responsible for the additional costs of insuring their spouses and/or children. If I read the recommendation correctly, that does not appear to be an option.

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Tredyffrin Teachers Union Accepts Fact Finder Report, T/E School Board Rejects

The results from last night’s special meeting of the T/E School Board were anticlimactic and expected.  Tredyffrin Easttown Education Association, the teachers union, voted to accept the fact finder’s report from the PA Labor Relations Board.  With a vote of 7-2, the School Board voted to reject the report. Kris Graham and Anne Crowley provided the two dissenting votes in support of the fact finder’s report. The recommendations in the fact finder’s report must be accepted or rejected in its entirety.

According to Jeffrey Sultanik, TESD contract negotiator, no public discussion of the fact finder’s report is permitted until the report is published.  It is expected that the PA Labor Relations Board will release the report today.  During the next 10 days, the public can weigh in on the report and on then at a second special meeting on Monday, August 20, the school board will take another vote on the report.  If the school board votes again to reject the report, traditional negotiations will resume between TEEA and TESD.

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T/E School District Teacher Contract Update … Special Meetings to Consider Fact Finder’s Report

Back on June 19, the contract negotiations between the T/E School District and the teachers union, Tredyffrin Easttown Education Association (TEEA) reached an impasse and both sides requested that the PA Labor Relations Board (PLRB) assign it to a ‘Fact Finder’.  The neutral third-party was to review the proposals of TESD and TEEA and then make a recommendation.

On June 30, the contract deadline for the T/E teachers came and went with no new contract signed.  As of July 1, the school district and the teachers union, TEEA entered the ‘status quo period.  Status quo freezes the teacher’s salary at the 2011/12 salary until a new contract is signed.  The teachers continue to receive their salary at the current rate until either (1) a strike or lockout within the terms the 1992 Act 88 or (2) they enter into a new contract. The teachers health care benefit plan remains intact (based on the expired contract term) during the status quo period.

The Fact Finder’s report was issued on July 30 and TESD and TEEA has 10 days to notify PLRB as to whether they accept or reject the report.  The School Board and Administration are expressly prohibited from making any statements about the Fact Finder report until after PLRB releases it for publication.  But PLRB will only release it for publication after either or both sides formally inform the PLRB that they are rejecting the report.

Here’s what I don’t understand – the School Board is holding two special meetings (August 9 and August 23) to consider the Fact Finder’s report.  If the School Board is prohibited from making statements until the report is released and they only release it if one or both sides reject the report, how is it then possible that the School Board can now have special meetings to consider the report?  Jeez, I must be missing something here on this process.  Another question … is TEEA likewise prohibited from discussing the Fact Finder’s report.  Keith Knauss, if you are reading Community Matters, can you help me understand how this process works.

I am curious, so I will attend this week’s special meeting on Thursday at 8 PM in the Tredyffrin Easttown Administration Office, 940 W. Valley Road, Wayne, PA.

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TE School District … Teacher Contract Costing

Keith Knauss, Unionville-Chadds Ford School District school board member, and regular contributor to Community Matters, has written ‘TE Contract Costing’ that may help us all better understand the teacher-school board contract negotiations process and the reasons for certain decisions. I thank Keith for his research and for sharing the information with us.  I have provided an overview below along with my comments. (If you have a problem reading the numbers in the tables, click on the graphic and a larger version will open in a new window.)

In his opening remarks, Knauss states …

“ … Understanding contracts has taken on new importance since Act 1 of 2006. Previous to Act 1, school boards could negotiate contracts and raise taxes to whatever level was necessary to balance the budget. Since Act 1, many districts have had to, with great reluctance, reduce staff and programs to keep budgets within the limits of the ‘cap’.”

Employee compensation is the major factor determining the size of a school district budget and, subsequently the real estate tax rate increase. If the District budget is to be balanced under the restrictions of Act 1, close attention must be paid to the terms of the contracts.

In the following table, Knauss presents the TE offer summary – the initial 1/9/12 offer by TEEA, the TE School Board 2/9/12 offer and TEEA 6/18/12 offer. The table indicates the average teacher compensation and taxpayer impact.  According to Knauss, “The percentage increase in Average Teacher Compensation is more than the percentage increase of Local Tax Impact for 2 reasons … state subsidies and attrition.”

The following table reviews the salary and benefit packages of TE teachers.  Krauss provides the approximate compensation (salary and benefits) for the average T/E teacher using the current teachers contract.  The numbers are supplied by the District or are multiplications of the salary and the appropriate rate (PSERS and FICA).

Knauss presents the following Salary and Benefit table, offering that the “… Total Teacher Compensation is a straightforward multiplication of the Average Teacher Compensation and the number of Employees. Total Teacher Compensation is the money taken from the taxpayers (local and statewide) for the services provided by TE teachers.”

Here is an interesting graphic from Knauss, indicating the funding sources for teacher compensation.  The major source of funding – local taxes and a secondary source of funding is from state and sales tax for half of PSERS and half of FICA.

Krauss looks at the effect of any contract settlement on the T/E taxpayers, and whether it can be financed within the Act 1 limits.  He looks at two different costing methods – “One method looks at the total cost of the contract to all taxpayers, local and statewide; the other method looks at the cost of the contract to the local taxpayers to reflect the local tax impact of any other offer by ‘backing out’ the statement reimbursement for PSERS and FICA.”

The Local Tax Impact is calculated by “backing out” the state contributions to FICA and PSERS.  Notice that the state contributes $3.0M in subsidies to lessen the Local Tax Impact.

————————————————————————————————- 

When reviewing a teacher contract offer, Knauss supports the use of the following criteria:

  • Is the offer economically sustainable under Act 1 limits?
  • Are the compensation increases of the offer in line with the current economic climate?
  • Is the compensation appropriate to attract and retain employees of quality?

Knauss answers a question that many have wondered … what happens if the teachers and the school board cannot reach a settlement? Due to substantial differences between TEEA and TE School Board, the union requested fact-finding by the PA Labor Relations Board.  The independent fact finder will review both TEEA and TESD proposals and then make recommendations … however, remember the recommendations are non-binding.

The current teachers’ contract ends on Saturday, June 30.  If an agreement is not reached, the teachers enter the “status quo” period, meaning that they continue to teach … to the expired contract.  The teacher’s benefits and salary remain the same as in the expired contract.  It is obvious that the School Board would not want an extended ‘status quo’ status for the teachers because it precludes any change to heath care benefits, compensation, etc. Knauss points out, that although the teacher compensation is frozen at its current level in ‘status quo’, legally the District must absorb any increases due to PSERS contributions or healthcare.

However, the situation is different from the teachers’ standpoint.  During better economic times, the teachers would not want their contract settlement in ‘status quo’ state because working under the expired contract would mean that they would receive no additional compensation for years of service increase. But what choice do the teachers have?

According to TEEA website, the teacher’s last offer included a reduction in health care benefits and  salary freeze for the first year. In their rejection of the union’s offer, the School Board instead asked the teachers to take a compensation reduction of $8,000 per teacher – which equates to as much as 13% for some teachers.  There is little surprise that TEEA rejected that District’s offer, opting instead to go to the PA Labor Board.  Why would the teachers want a new contract … status quo also keeps their current salary intact and preserves their current benefit package intact.

Knauss provides a multi-year analysis, assuming status quo and average compensation.  He presents his analysis in several slides, giving us an idea of what certain scenarios would mean to the average taxpayer.  To read Keith’s full report, click here.

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