We feel as though we are emerging from a tunnel this week, pushed by a strong wind into bright light!
This is because in just two weeks we have made significant gains in positioning the district for sustainability. You could call these efforts “course corrections” or describe them as needed reforms. I will leave the descriptions to others, and simply tell you what has been done. The gains were made in facility planning and in employee benefits and compensation.
With the bold assistance of the Board of School Directors, we made wholesale changes in the benefit structure for active and retired employees. We were driven to action because our responsibility for retiree benefits has become a massive liability for the district, a $2.2 billion liability. For years, the OPEB (Other Post Employment Benefits) costs have been largely ignored.
When labor agreements expire in July 2012 and July 2013, our employees will begin paying health insurance premiums based on their salary levels, with those employees making $25,000 or less paying 5% toward their premium (under the low-cost plan) and those at the highest end of the scale paying 14%. There are higher deductibles, with the chance for workers to earn back the cost of the deductible with participation in wellness initiatives. We increased the number of years of service needed to retire and adjusted the payouts for sick days.
The changes will position MPS for more than $170 million in savings over the next five years, significantly trimming (but not eliminating) projected budget deficits, helping us to avoid more teacher layoffs, and protecting benefits for future retirees. Our benefits and compensation changes will place us in line with many other employers, and will protect resource for our students and our staff.
On the topic of facility planning in November, we provided to the Board our final Facilities Master Plan. It’s more than an inventory of our 170 buildings. It is a blueprint for our future physical footprint, and for our re-styling of the district programmatically. The final plan is online here. Go read it. Within a week we will be before the Board to follow through on some of the recommendations the consulting team made.
So, we have been busy. When I mentioned it felt as though we had been through a tunnel, I am telling you that since I began as Superintendent 18 months ago, I have felt the gloomy specter of the OPEB costs dogging us. We could not move forward without addressing them. Now things are brighter for all of us, though we will be back in a couple of years to discuss further adjustments.
The work never ends. But that is how it should be, when we are driving reforms for the sake of the children.