PUSD gives nod to early retirement buyout plan
Aims to replace older teachers with newer ones at lower cost
Teachers eligible for retirement will be offered an extra incentive to bow out early under a plan approved Tuesday night by the Pleasanton school board.
The plan would offer 75% of their final year's salaries for teachers who decide to retire, with the district saving money by hiring newer teachers at lesser pay. Administrators and non-certificated employees would not be eligible.
To make the plan work, nearly 60 teachers would have to choose retirement, according to Luz Cazares, assistant superintendent of business services.
"We need 59 eligible employees," Cazares told board members. "That's about 35% of eligible employees."
The offer would be cancelled if fewer than the 59 required sign up.
"This is going to be difficult to achieve," said Dennis Hu from Public Agency Retirement Services (PARS). "It may be a long shot."
PARS is a private company that specializes in buyouts of this kind; Hu said the firm has worked with public-sector employers from San Diego and Los Angeles to San Francisco. The district would pay PARS 5% of the total payouts to administer the program for five years or at least $5,000 per year.
The district estimated 17 retirements through natural attrition from people who would take an existing early retirement incentive of a one-time payout of nearly $38,000 and annual health care costs of about $6,800 until they're 65, when Medicare benefits kick in. Those who take the PARS deal would not be eligible for the district's incentive.
PARS's initial estimate was that 41 teachers -- about 24% of those eligible for the buyout -- would take its offer, which would actually cost the district more than $426,000 over the five-year length of the payouts. The district would still cover health care costs until the retiree is 65.
The number needed for the plan to work could be lower than 59 if enough higher-paid employees sign up and could be higher if lower-paid employees take the deal. The PARS plan is based on an average salary of an incoming employee at about $62,000 a year and an average of about $90,000 for those retiring. Those numbers were provided by the district for PARS to make its calculations.
"This program is about math," said Board Member Jeff Bowser. "It's taking an expensive teacher and replacing it with a less expensive teacher."
Bowser abstained from the final vote because his wife would be eligible for the buyout, but said she had no intention of retiring.
While Board Member Jamie Hintzke worried that the district could lose experienced teachers, Superintendent Parvin Ahmadi noted that many of them do return as mentors and substitutes.
Board President Joan Laursen said the deal could save jobs.
"This means we wouldn't have to lay off 59 teachers," she said.
Trevor Knaggs, president of the Association of Pleasanton Teachers (APT), said he also supported the plan.
Teachers who opt for the PARS plan would have to sign up by April 27 and would need to submit an irrevocable letter of resignation; if enough employees don't sign up, the district would void those termination letters. If too few take the option for the district to go ahead with the plan, PARS would get a one-time fee of $3,500.
The district would pay 15% of the salaries of each retiring employee through PARS for five years for the 75% total.
To be eligible, an employee must be 55 or older with five or more years in the district or 50 years or older with 30 or more years. Employees who take the buyout would have the option of getting paid the 75% of their salaries over the course of five to 15 years or to get a smaller amount annually for the rest of their lives.
In other budget matters, Cazares said the district might have to cut another $8.5 million from its budget in the 2013-14 school year if school revenue proposals don't pass in November. There are currently three different packages (see page 7) that could offer districts across the state financial relief. In a presentation of the district's current financial state, Cazares said it currently has nearly $67 million in undesignated reserves, with an unexpected $217,000 it received from lottery sales. With no increase in state funding, those reserves would drop to about $181,000 for the 2012-13 school year and to a deficit of $8.5 million the following year.
In a lengthy discussion that included invoking Robert's Rules of Order several times, the board agreed to discuss taking money from the Sycamore Fund to pay for a facilities master plan study.
Board Member Valerie Arkin made the motion to put that on the board's next agenda; Arkin also wanted to discuss the possibility of postponing the study and included that in her motion, which was disallowed on a point of order by Laursen. Arkin's following motion, to postpone the study, fell flat with no support by Laursen, Bowser or Board Member Chris Grant.
The Sycamore Fund was established through the sale of district property. It was initially set up for technology upgrades but has been used in recent years as a source for revolving loans. The fund once stood at more than $7.2 million but now holds just shy of $4.8 million, with more than $2.4 million owed by the district.
Budget matters may not matter for kids, but homework does, and a review of district homework policy adopted last year shows most students -- and many parents -- still think they have too much. That flies in the face of teacher responses to a survey done of parents, teachers and students.
The survey shows 29% of parents and 53% of students think too much homework is assigned while only 3% of teachers agreed. Students and parents also thought more homework was being assigned while only 1% of teachers thought that was the case.
One thing that all agreed on, although the percentages differed, was that there still is difficulty in coordinating homework assignments between teachers so that students aren't deluged with homework on some nights with much less other nights.
That, board members agreed, needs to be handled on a school-by-school basis. Jane Golden, director of curriculum and special projects pointed to one school, Harvest Park Middle School, as moving in the right direction; the school now uses Google's calendar feature to coordinate assignments between teachers.
While students still claim they're getting homework on weekends and holidays, Cindy Galbo, assistant superintendent of educational services, said a part of that may be procrastination by students who are given an assignment early in the week and wait until the last minute to complete it.
Many students reported they never use social media, text or surf the Internet when they're doing homework, but Laursen, a parent herself, was skeptical.
"Sorry, students, I don't believe you," she said.
The student member of the board, Sherya Gupta, said she'd talked to her friends about homework and that many agree there has been a shift, with less homework in general. Gupta said that's not the case for students taking several advanced placement (AP) courses, many of whom work hours each night. Board members pointed out that AP courses aren't covered under the district's policy for homework.
The board also gave its final approval to begin transitional kindergarten in the upcoming school year. The plan would initially offer a kind of pre-kindergarten for students who turn 5 in November of the school year, but could be expanded to those who turn 5 in October and September. Based on current funding figures from the state, at a 30 to 1 ratio, the district would actually make more than $200 even if the state doesn't fund the program until those students are actually 5 years old, although the current plan is to fund the program from the start of the school year.
The meeting lasted nearly two-and-a-half hours and action on several items was postponed until the next board meeting, set for March 27.