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10/9/2009
School district contracts push up tax levy

At a time when taxpayers are struggling in this destabilizing recession and most are not seeing wage gains, the Appleton Area School District (AASD) has proposed a budget that increases the tax levy by 9.7%.

At a time when the state budget is suffering billion dollar deficits, when the state has cut its support of AASD, when enrollment has declined by 220 students, and when inflation is 0%, still the district’s total budget increased by over $3 million (from $176 million to $179 million)!

The district’s budget increase is primarily fueled by employee compensation increases, including an 8.2% increase in health care benefits – for a benefit plan that is already a Cadillac. Cost reductions could most certainly be achieved via increased efforts to decrease utilization and increased premium participation (school employees pay only 5% of their health insurance premium that for a family is almost $20,000 a year) and/or simply putting the very costly health insurance program out to bid. As it is now, the union dictates that the health insurance must be carried by an arm of WEAC.

In addition, though the budget reflects a wage freeze for administration employees, no such offer has been forthcoming from the teachers union.

I talked about AASD’s budget (and the 9.7% increase in the levy) in yesterday’s FP blog. A reader pre-empted my solution.

…. I can tell you from my anecdotal experience, that while many of the teachers are excellent and the programs offered are truly some of the finest in the state ... some (if not many) teachers in the district are completely clueless as to how non-state employees have to live & budget.

The first place I would cut with a VERY sharp knife are the absurdly lavish health insurance benefits offered to the faculty. Sorry, but the reality is they ALL need to have some skin in the game. Sound familiar?

While making at a full time 12-month a year job only half of what they get (for 10 months of work - and that's a generous estimate), I was at one time paying $700/month for my family's health "insurance" and still had a $1,000 deductible PER PERSON. Admittedly this was a terrible plan, but it was the best my very small employer could get for a 'group' of four households.

Put the teacher pay scale and benefit package on par with the averages of households in the community and you'll be off to a REALLY good start in making this an economically viable district.

Or this.

If you took an informal poll of local business I think you would find almost all are struggling with decreased revenue. I think (if I remember right) teachers are getting 7% over two years. Most of my friends are lucky to see 7% in 3 or 4 years----if that soon.

I am deeply disappointed that the teachers union does not recognize this and join the administration in a wage freeze….

This is a time for all good people and role models to come to the aid of their neighbors.

AASD wages are very competitive with area school districts and certainly competitive with average earnings in Wisconsin. Completely free retirement benefits and almost free health benefits add up to a total compensation package (for a 9-month work year, for most) that is significantly above average compensation packages in Wisconsin and significantly above national averages for teachers.

When I asked, in yesterday’s piece, “Why are district employees not sharing in the struggle?” Paul, a FP reader, responded

Because they can? I think so. This is insanity.

Taxpayers in the Fox Valley are working harder to make fewer dollars stretch farther. Given Wisconsin’s public union negotiating laws, it’s very difficult for the school district to do this by itself. It’s time the employees did their part, so district dollars would stretch further without further increasing class sizes and without further cutting back on instructional supplies.

You can make a difference. Attend the budget hearing Monday, October 12, 6:15 PM, Wilson Middle School, and make your views known.

Jo Egelhoff, FoxPolitics.net

COMMENTS

As long as people persist in ideological boxes, with inflammatory labeling and overly simplistic solutions, the challenge of pursuing fiscal responsibility in our schools will continue to be sidelined by divisive rancor. The shop-worn mantra of cutting “Cadillac” benefits as the only or best answer to fixing current expense problems needs to cease.

Let back up a few steps. We can agree that the tax levy proposed by the Appleton Area School District is unacceptable, especially in the current economic recession. I think we can also agree that personnel costs, being the largest single budget category, warrant the first focus of attention.

Within this personnel category is a subcategory I’ll call “compensation,” that is, all money spent on wages, salaries, benefits, incentives, perks, etc. for employees. The fundamental question becomes, “Is the monetary value of compensation paid to personnel for the services they provide appropriate?”

Statements like “wages are too high,” “absurdly lavish health benefits,” “average community household income” are meaningless absent context. Anyone can play number games with single budget line items. A good example is the corporate executive who makes “only” $750,000 in annual salary, while collecting an additional $8 million in benefits like performance bonuses, deferred stock options, interest-free loans, housing and entertainment allowances, special travel privileges, family involvement subsidies and on and on. A $750,000 annual corporate executive salary would probably not draw lots of attention. $8 million total compensation however will and should raise eyebrows.

The starting point for dialogue I suggest is the bottom line cost of each employee to any organization including the AASD. It makes little difference from wherever the total cost of employment is derived. If an employee elects to take 60% of his or her compensation in health care coverage or retirement contributions rather than pure wages is immaterial. (Check what AASD contributes to its employees’ retirement). It’s the aggregate cost to the employer (taxpayer) for compensating employees that matters.

Having perhaps defused or at least muted somewhat the incendiary rhetoric of the ideologues, the issue of appropriate compensation levels (affordable, reasonable, competitive, fair) can be collaboratively addressed.

A second piece of this discussion needs to involve the nature of the work performed by AASD employees. What deliverables does the community expect of the AASD personnel?

Presumably the intent of public education is to deliver a productive citizen. Again the ideologues prefer to resort to simplistic criticism when describing this effort. Talking about school performance, they often converge on highly subjective quality of output measures. The tired refrain of “Too many kids can’t read, write or compute well” is being supplanted by “Graduates are ill-prepared for life at work, in college, as responsible citizens or wise consumers.” Solutions to these criticisms (affording them a modicum of credibility) are far too complex to be handled solely by setting higher expectations for teachers’ classroom performance, i.e. target standardized test scores.

Increasingly schools have become community social service centers. Schools are not only expected to build cognitive abilities but also to instill motivation; inculcate values; ensure nutrition; promote wellness habits; enrich artistic, cultural and athletic proclivities; supervise before school and after school time; prepare preschoolers for school; intervene in family and social dysfunctional relationships; and just plain take care of kids so the nurturing demands on parents and the enforcement demands on police are kept in check.

How much do we as a society want and consequently need to pay for these programs and services delivered within schools? What amount of AASD personnel costs are dedicated to producing, administering or coordinating programs and services that supplement the primary educational curriculum?

As an aside, the comparative measure of cost per student by itself can be very misleading. Use of headcount rather than contact hours can be deceiving as evidence of comparable cost. There are all manner of ways to decrease the average cost per student with part-time experimental programs such as on-line charter school or preschool training for 3-yr. olds.

A third piece of the discussion speaks to what kind of personnel are wanted. Clearly we want competent, caring, educators teaching our kids. What kind of compensation is necessary to attract such professionals?

People pay varying amounts for the products and services they receive. Factors such as education, length of experience, supply and demand, performance track record, and time spent on-the-job come into play when determining reasonable compensation for those providing products and services. So, too, does the relative value placed on jobs by society. For example, people with post-secondary education tend to get paid more than those with high school diplomas or equivalent achievement. And certain professions typically receive higher incomes than others because of their perceived worth. Doctors get paid on the whole more than lawyers. Accountants more than bank tellers. Investment advisors more than those in auto sales.

A lot of senseless garbage is spewed about comparable compensation for teachers emphasizing their short work days and partial work year. “Why do teachers get paid so well to work six hours days with three months off?” Again the litany of misinformation and misconstrued data is deafening.

When attempting to compare factors for compensating teachers relative to other jobs, here’s a checklist with which to begin.

- Does your job demand a college degree as a condition of employment?
- To keep your job, are you required to regularly maintain professional certification through accredited self-development paid at your own expense?
- Is a post-graduate degree normative for your career advancement and increased compensation?
- How much paid time-off do you receive annually for holidays, vacation, illness, personal needs?
- Is your daily work performance dependent on extensive preparation before and after your time at your job site?
- Does your performance depend to some extent on work with abusive, uncooperative, ill-equipped, disruptive and even subversive customers?
- What amount do you spend out of your own pocket each year to purchase equipment and supplies to do your job?
- Must you be available to speak with your customers after work hours and on weekends?
- Are you expected to contribute to customer success in unpaid, non-workplace endeavors?
- Is your personal safety at risk in your place of work?
- How strong is the competition (new and comparably experienced professionals) for your job in your marketplace?

I suspect that folks shy away from analyzing compensation in favor of talking about single compensation components like gross salary, hours worked, paid health benefits because it’s easier to support preconceived biases. True analysis is hard work requiring lots of data and many distinct value decisions, some of which may be very uncomfortable to admit.

Jo, don’t fall into that pedestrian trap…and remember teachers are taxpayers too!

Dennis (Sat Oct 10 14:18:18 2009)

Dennis: What a bunch of, "Gobbly Gook"! You obviously are either: 1.) An Educator, or 2.) In the employ of WEAC. The inescapable conclusion is that in this kind of a macro-economic situation, public education has priced itself beyond the ability of the Taxpayer to pay. WEAC is NOT a professional association. It is simply a UNION. As such, its only purpose is to MAXIMIZE the TOTAL compensation of its UNION MEMBERS. Period! GLS

GL Schilling (Mon Oct 12 15:15:06 2009)

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