Board protects retirement-eligible teachers

Posted: Feb. 8, 2012

Oconomowoc Area School District - In an effort to find savings for the district, school officials are looking at ways to whittle down the $2.5 million it spends each year on post-retirement benefits.

School Board members will continue to meet in closed session to work on plans to reduce the cost of health and dental insurance benefits provided to qualifying retirees.

Recently, however, in an open session special meeting, a decision was announced for those teachers who have already met the eligibility criteria and elect to retire at the end of the current school year.

The board acted only on retirement benefits for those teachers who are eligible for early retirement benefits at the end of the 2011-12 school year.

Teachers who are age 55 with at least 15 full-time equivalent years of service who elect to retire at the end of the 2011-12 school year will remain eligible for up to 10 years of post-employment benefits.

Teachers will have the option of having $17,600 (family benefits) or $7,600 (single benefits) contributed annually to a health reimbursement arrangement account for the purchase of health and dental benefits or to a tax-sheltered annuity.

 "The board felt that teachers who had already met the eligibility criteria and will retire this year had earned the full benefit. The board thought that protecting this veteran group of retirement-eligible teachers was the right thing to do, given that reductions in post-employment benefits for future retirees are almost a certainty," said Mike Barry, assistant superintendent of business services.

"This is two years in a row we have done that," noted Board President Don Wiemer.

With decreasing state aid and climbing enrollment, the school district is looking at ways to tighten its belt.

The state's budget-repair bill, enacted last year, limited collective bargaining rights and opened the door for districts to curb the costs associated with benefits.

Under the terms of the governor's bill, teachers began weighing the options of retiring before benefits and pension plans are altered.

Last year the district eyed reduced labor costs as a result of an increase in early retirements and support staff changes reached through retirement and attrition as a means of helping to close the budget gap.

In April 2011, the Oconomowoc Area School District approved the early retirement requests of 21 employees, including 18 teachers representing 468.62 years of teaching experience leaving the field.

A loss of three support staff individuals represented a total of 78.5 years of service to the district.

In a typical year, the district approves roughly half that number.

Wiemer said the board continues to meet in closed session with the district's labor attorney to discern how best to scale back those benefits.

"That's what we haven't resolved completely; that and what do we do with newly hired teachers," he explained.

In addition, the board is exploring how benefits will be paid to district administrative assistants and custodians.

"Our goal is to eliminate post-retirement benefits over a period of time," the board president explained.

Recently, it was reported that post-employment benefits for employees of the Richmond School District may be eliminated if a proposed individual teachers contract is approved as expected by its School Board. The decision could set a precedent for other school districts to follow.

The Richmond School Board expects to approve the action at its Feb. 13 meeting.