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Public Notices

April 18, 2014

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Teacher Retirement
Bonuses Stir Debate

Sun Photo By O.J. Early

Greene County Board of Education member Kathy Austin, at left, makes a point during a board of education workshop on Wednesday. Board member Deborah Johnson listens at right. Assistant Director of Schools Judy Phillips is shown in the background.

Originally published: 2013-02-07 10:52:12
Last modified: 2013-02-07 10:53:30
 


Additional Images

County School

Board Members

Differ On Ways

To Move Forward

BY KRISTEN BUCKLES

STAFF WRITER

Greene County School System employees packed the Central Office boardroom on Wednesday to hear the latest discussion on the future of retirement bonuses by the Greene County Board of Education.

The board held a workshop to discuss the current retirement bonus program, policy related to board committees, and the 2013-2014 county school budget.

During the two-hour meeting the board was only able to address the first two items, and chose to set a follow-up workshop for Monday to begin early discussion related to next year's budget.

While no decisions were made on Wednesday, the board continued their recent trend toward hot debate, with a division in viewpoints clearly evident.

RETIREMENT BONUSES

Chairman Roger Jones opened Wednesday's discussion with the retirement bonuses issue, referring to them as "loyalty bonuses."

The board implemented this program in the early 1980s as "a way to reward our teachers for staying loyal to us," he explained.

Benefits for qualifying teachers include a bonus at retirement equal to 35 percent of their salary, which, according to Budget Director Mary Lou Woolsey, typically averages between $15,000 and $16,000.

Those that qualify may also continue under the system's insurance program until they are eligible for Medicare, Jones added.

The system typically "recoups" these costs after two or three years by replacing these experienced individuals with teachers with less experience who, for that reason, enter school system employment at lower salaries, Woolsey said.

In order to qualify for the retirement bonuses, teachers must have spent at least 20 years with the Greene County School System and must either have 30 years' total experience or have reached 60 years of age or older.

SUSTAINABILITY

"We're having to look at the long-term effect of it," Jones told the audience Wednesday, noting that he would not accept questions from the audience during the workshop.

He did, however, request that teachers privately share any input with their board representatives outside the meeting.

"What we're doing here is the most important thing we do -- because the most valuable [tool] we have in the classroom is the teacher," Jones said.

The board agreed late in last year's budget cycle to address this program due to the unregulated and potentially unsustainable financial liability the program presents.

Director of Schools Dr. Vicki Kirk noted her recommendation that no changes are made for those teachers who would qualify for the program within the next five years.

These individuals, she said, are already relying on this bonus that has been promised them for decades.

Moreover, she noted that removing the bonus immediately could result in a rush of retirements this year.

Should everyone who is eligible to do so retire under the program this year, the system would owe nearly $918,000 in bonuses, Kirk said.

Woolsey noted that the system budgeted just under $400,000 in retirement bonuses for this year.

LESSENING LIABILITY

The board then discussed various ways in which the program could change over time to lessen the financial liability to the school system or in some way increase the predictability of how much the system would need to be able to spend on the bonuses in a given year.

Kirk presented five scenarios that, beginning five years out, would slowly decrease the salary percentage teachers would receive as a bonus from 35 percent down to perhaps 20 percent.

Some scenarios also included a three-year window from the time of eligibility in which teachers could accept the bonus and retire.

"I don't think we as a system can be looking at sending good teachers home," Jones said in opposing the idea of having a window of eligibility.

This, he argued, could act as an incentive for experienced teachers to retire earlier than they otherwise would have done so.

MAJOR CHANGES PROPOSED

Board members Kathy Austin and Deborah Johnson, however, said that the system needs to first know exactly what is affordable within the current budget to ensure that the program is not the cause of any future increased funding needs or tax increases.

"We've got to know we can balance the budget this year," Austin said, She proposed that the system could include the bonus on a year-by-year basis, as funding is available.

This, she added, could allow the system to provide the money to teachers now, as a salary bonus, rather than later as a retirement bonus. In support of this suggestion, she noted that it has become questionable if the school system will even be able to continue to fund the retirement bonuses.

"At the end of the day, we have to balance," she said.

Chairman Jones disagreed, saying that it would be difficult or impossible to make the County Commission understand how or why the system provided such yearly salary bonuses.

Johnson said it was her opinion that the system already offers good salaries and benefits, agreeing with Austin that such bonuses should only come as they were clearly affordable within the current budget.

She proposed limiting the number of teachers that can retire each year, or providing the bonus on a first-come, first-served basis subject to that year's budget.

"We can't afford another tax increase due to the school system not balancing their budget," Johnson said.

Both Jones and Kirk objected to this suggestion, saying that the system could not prevent teachers from retiring or fairly exclude any eligible individuals from a retirement bonus program.

Moreover, Kirk said that she is "hopeful" that this year's budget will not require any additional local funding.

Jones, as well, said that he is "confident" that additional funding will not be necessary this year.

"This is not the reason we had to raise taxes," the chairman said.

"Quote me on this," he later concluded. "We are not out here trying to be a proponent for tax increases."

The discussion concluded with the promise to return to the topic at Monday's workshop.

Board member Nathan Brown requested that annual cost estimates for each of Kirk's five scenarios be provided, as well as consideration of Austin's proposal for current salary bonuses instead of retirement bonuses, should teacher feedback indicate that as a preference.

 
For more information and stories, see The Greeneville Sun.

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