Is the Proposal Really a 10% Raise?

A detailed response provided by Dr. Long:

Two-and-a-half years ago our district had a very large funding gap to close. It was caused mostly by escalating costs and flat funding by the state. A big PERS bump and rising insurance costs were the biggies, but there were other factors as well. The way we resolved it was to go to all of our employees and essentially ask for everyone to take about an 8% reduction in compensation. Most of our employees agreed to pay their 6% employee portion of the PERS (the PERS pickup) and accept some health insurance plan changes. We also did some staff reductions to make up the rest. All of these employees continued to work their full contracts (no reduced days).

The MEA was bargaining with the District at that time and while they were willing to help, they were unwilling to make changes that might easily become permanent. They were unwilling to accept the need for a compensation reset. Their solution was for the district to eliminate about 50 FTE licensed positions, furlough the remaining licensed staff for 8 days, and they also accept some changes in the costs of health insurance and pay 7% of the premium cost of health insurance. They also wanted a mechanism that could restore days if funding came back. We agreed on a rubric for that: For every $350,000 of increased revenue, we would add one day back. That was equal to about ½% salary.

At the end of the 11-12 school year the district received one-time adjustments from ODE for the 2011-12 year and the 2010-11 year that equaled four days. Because this came after April 15, we added the four days to the 2012-13 school year. That was the equivalent of a 2.1% restoration of salary in 2012-13.

If the reset year (2011-12) was the baseline for all employees, then teachers came into this contract negotiations 2.1% ahead of all other employees based on contract days. Our current offer is 10%, 1%, and 1% for a 190 day contract. Given that we are asking them to pay their 6% PERS pick-up, the math actually looks something like this:

Make contract whole (186 to 190 days) = 2.1%

Buy the PERS pickup                            = +6%

Employee contribution to PERS             = -6%

Remaining Salary increase                    = 1.9%

District Offer Total                              = 4.0%

Some would argue that the days should not count as a raise because it was simply a matter of making the contract whole. If you accept that logic, then the raise for the first year of the district’s proposal is about 1.9% - still pretty good when one looks around the state. Still a teacher who has been at the top of the salary schedule the past three years would see that, all other factors being the same, their December 2012 paycheck was about 2.1% higher than their December 2011 paycheck . . . and their December 2013 paycheck would be about 4% higher than their December 2012 paycheck. And about half of all teachers have received additional annual step increases of 3.4% during this extended period of economic turmoil.

Given this scenario, here is how the Association’s most recent base salary proposal costs out:

Pay for four days          = 2.1%

Salary increase             = 2.0% to 2.99%

Total Year 1                 = 4.1 to 5.1%

Propose Year 2            = 3.75%

Of course, this is just one of several economic variables in the contract. It does not take into consideration proposed payments to teachers at the secondary level for high class sizes or payments to elementary teachers for combination classes. And the most challenging issue is the supplemental health Insurance retirement benefit. While the district has been able to find a solution that eventually shifts that future post-employment benefits to a current benefit (matching 403b) for all of our other employees, the Association has struggled with this. We are currently at least $45 million apart on resolving that issue alone.