Friday, February 14, 2014

The Affordability of Our Offers

Our proposal of 2.5 percent increase in the salary schedule each year while maintaining current benefits was not only based on the idea that it is a fair, competitive offer, but that it is also reasonable given our district’s financial situation. Here are the main ideas that make our package affordable:

New Funding
Improved funding from the Legislature has helped several districts increase pay for their teachers.
·       The basic funding formula increased for all districts
·       New state funding for all-day, every-day kindergarten will free up money we now put into sites that already have it
·       The Legislature increased a compensatory education pilot for the Anoka-Hennepin district
·       Impact: $7.7 million available

Fund balance history from our district's most recent audit
Appropriate Fund Balances
The professional organization of school finance officers says school districts should hold reserves of 5 percent to 15 percent, with larger districts safely able to maintain the lower levels.
·       Currently, the district has 7 percent to 9 percent of our funds in the unassigned fund balance, which is one of several such fund balances
·       District fund balances have been rising steadily over the past six years to point they are outpacing the state average in both sheer size and rate of growth
·       Impact: $15.8 million available

The district overstates the cost of our package
The district artificially inflates the actual value of our compensation package through the use of the “cast forward” method of predicting future costs.
·       Thirty positions in our unit are paid for by Q-Comp
·       Thirty positions that will be cut next year are costed against our package
·       An estimate of 10 percent increase in health care costs is not likely
·       Retiree savings, conservatively based on our past five-year history, is $30,000 each for at least 75 retirees. Currently, the district only considers $25,000 savings for 50 teachers
·       Impact: Reduces district estimate of package costs by $8 million

Our Fair Share
In creating our proposals, we are mindful of the many needs and obligations of our district.
·       Teacher compensation and benefits currently amount to 61.5 percent of the district budget
·       Our proposal would maintain that share of the budget.
·       By keeping our request reasonable, other employee groups and programs will be able to access increased funding
·       Based on our calculations, our proposal is not only affordable, it leaves additional funds available for other proposals like class size / case load reduction, substitute relief for special education teachers, and increased pay for hourly subbing
·       Overall Impact: These ideas covers costs with $5.8 million to spare