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Legislative Hearing to Resolve Impasse

for 2010-2011 PEA Contract Negotiations

Marianne CapozielloPEA President

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Available Funds

Angela Dawson

Capitol Outlay

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See District Budget 2010-2011 p. 63

Fund balance reflects the net financial resources of a fund – in other words, assets minus liabilities – in simpler terms, dollars available to spend. If some of the funds’ resources are not available to spend, this would be indicated by “restricting” or “reserving” a portion of fund balance.

WHAT IS FUND BALANCE?

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General Fund Balance – 5 years

Budget Year

Beginning Fund Balance Proposed Ending Actual Ending

$ Change Annually

% of General Revenue

2006-2007 47,240,688$ 35,895,093$ 62,111,233$ 14,870,545$ 8.6%2007-2008 62,111,233$ 56,280,334$ 57,741,793$ (4,369,440)$ 7.2%2008-2009 57,741,793$ 43,094,198$ 62,061,956$ 4,320,163$ 8.3%2009-2010 62,061,956$ 48,856,142$ 68,818,030$ 6,756,074$ 9.5%2010-2011 68,818,030$ 44,855,450$ 78,984,940$ 10,166,910$ 10.6%2011-2012 78,984,940$ 61,169,378$ Available

6.5% of General Revenue $ 48,385,591 $ 12,783,787 6.5%

District Budget Summary 2006-2011

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GFB – 5 year trend

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Classifications of Fund BalanceNonspendable – The net current financial resources that cannot be spent because they are either not in spendable form or are legally or contractually required to be maintained intact. Generally, not in spendable form means that an item is not expected to be converted to cash – examples include inventory, prepaid amounts, long-term amounts of loans and notes receivable, and property acquired for resale.Restricted – The portion of fund balance on which constraints have been placed by creditors, grantors, contributors, laws or regulations of other governments, constitutional provisions, or enabling legislation.Committed – The portion of fund balance that can only be used for specific purposes pursuant to constraints imposed by formal action of the highest level of decision-making authority – the district school board. These amounts cannot be used for any other purpose unless the district school board removes or changes the specified use by taking the same action it employed to previously commit the amounts.*Assigned – The portion of fund balance that is intended to be used for specific purposes, but is neither restricted or committed.*Unassigned – The portion of fund balance that represents amounts that are not nonspendable, restricted, committed or assigned to specific purposes.

*represents the Unreserved funds. PCSB District Budget 2010-2011 pg. 63

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General Fund Breakdown

PCSB District Budget 2010-2011 pg. 64

GFB Reserved unreserved graph

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Salary Comparisons

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Polk Average Salary

State Average

National Average Salary

State Difference

National Difference

2006-07 41,505$ 45,307$ 45,455$ 3,802$ 3,950$ 2007-08 43,325$ 46,930$ 48,553$ 3,605$ 5,228$ 2008-09 43,080$ 46,950$ 51,271$ 3,870$ 8,191$ 2009-10 42,761$ 46,708$ 49,306$ 3,947$ 6,545$

Teachers Average Pay

Teacher Average Salary Compared

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Why Does the Average Salary Decline?

• The Lapse Factor– Loss of experienced employees replaced with

entry level employees– The gap in wages and benefits between the two

employees is the Lapse– Benefits that are a percent of wages, FRS, UEC,

and Worker’s Compensation also add to the Lapse– The amount of time that a position remains

unfilled adds to the Lapse factor savings.

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Salaries of Comparable and Contiguous Counties

CountyBeginning Teacher Rank

Sarasota 38,530$ 1Manatee 38,517$ 2Lee 38,192$ 3Osceola 37,650$ 4Duval 37,300$ 5Hillsborough 37,014$ 6Pinellas 37,010$ 7Orange 37,000$ 8Pasco 36,420$ 9Sumter 36,381$ 10Brevard 36,000$ 11Seminole 36,000$ 11Lake 35,600$ 13Polk 35,000$ 14Volusia 34,010$ 15Hardee 34,000$ 16Highlands 34,000$ 16Okeechobee 34,000$ 16

Support Staff Starting Hourly

CountyStarting Wage Rank

Sumter 10.07$ 1Manatee 9.97$ 2Seminole 9.75$ 3Pinellas 9.39$ 4Lee 9.33$ 5Highland 9.17$ 6Orange 8.97$ 7Hardee 8.61$ 8Pasco 8.60$ 9Okeechobee 8.55$ 10Hillsborough 8.29$ 11Polk 8.05$ 12Duval 7.90$ 13Volusia 7.25$ 14

YearProposed Budget

Actual Expenditure

Ending Fund Balance

Lapse Factor & Trend

5000 TOTAL INSTRUCTION2006-2007 452,230,866$ 433,653,318$ 62,111,233$ 18,577,548$ 2007-2008 489,963,589$ 470,916,005$ 57,741,793$ 19,047,584$ 2008-2009 474,963,824$ 451,061,372$ 62,061,956$ 23,902,452$ 2009-2010 454,461,130$ 441,449,896$ 68,818,030$ 13,011,235$ 2010-2011 481,151,250$ 455,563,636$ 78,984,940$ 18,634,705$

General Fund – Instruction

**Numbers in Blue are Estimates

Instruction cost 5 years

Fund Balance versus the Cost of the PEA Salary Proposal

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Wage Proposal

PEA• Steps for all employees that

are to move up an experience step

• $500 at the top of the scale for anyone with no movement

• Pay longevity to paras and secretaries as per the contract

District• Freeze all wages at the

current levels• No additional longevity

added to salaries for paras and secretaries

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Health Insurance

Lee Littlefield

Blue Cross/Blue Shield proprietary information is

required to cost an insurance proposal.

Only your actuary has this information.

Most insured employees consume less than $1000 per

year in health care costs.

Source – PCSB Insurance Committee

Comparison of Benefits ScheduleCurrent 704 Plan Union Proposal District Proposal

October 1, 2009 - September 30, 2010

August 3, 2011 July 7, 2011

CYD - Individual/Family

$250/$500 $350/$700 $1,500/???

Max Out of Pocket $2,500/$5,000

$3000/$5000 per individual/family including co-pays and co-insurance

$6,000/???

Family Physician/Primary

Care$20 Copay $30 Copay CYD + 25% Coinsurance

Specialist Care $30 Copay $40 Copay CYD + 25% Coinsurance

Coinsurance for Most Remaining Services

CYD + 20% CYD + 20% CYD + 25%

HRA $0 $0 $0

Comparison of PremiumsCurrent 704 Plan Union Proposal District Proposal

October 1, 2009 - September 30, 2010

August 3, 2011 July 7, 2011

Premium for Employee

$0 - Monthly $0 - Monthly $50 - Monthly

Premium for Spouse $368 - Monthly $404 - Monthly $550.00 - Monthly

Premium for Child $92 - Monthly $92 - Monthly $150.00 - MonthlyPremium for 2

Children$184 - Monthly $184 - Monthly $300.00 - Monthly

Premium for >2 Children

additional $25 each - Monthly

$450.00 - Monthly

Adverse selection occurs as the cost of a benefit increases for everyone in a group and

some portion of that group has an advantage that allows access to the benefit at a

cheaper cost.

In addition to the above costs, employees must still meet their $1500 CYD.

Loss of SalaryImpact on Selected Positions

PositionCurrent Salary Reduction

Remaining Salary

Total $ Impact

ESE Basic PA 02 - Step 5 $13,753 $13,753 $03% FRS Contribution $413 $13,340 $413$50 Employee Premium $600 $12,740 $1,013$550 Spouse Premium $6,600 $6,140 $7,613$150 Single Child $1,800 $4,340 $9,4132nd Child Premium $1,800 $2,540 $11,2133rd Child Premium $1,800 $740 $13,013

In addition to the above costs, employees must still meet their $1500 CYD.

Loss of Salary Impact on Selected Positions

PositionCurrent Salary Reduction

Remaining Salary

Total $ Impact

BA Teacher - Step 15 $43,890 $43,890 $03% FRS Contribution $1,317 $42,573 $1,317$50 Employee Premium $600 $41,973 $1,917$550 Spouse Premium $6,600 $35,373 $8,517$150 Single Child $1,800 $33,573 $10,3172nd Child Premium $1,800 $31,773 $12,1173rd Child Premium $1,800 $29,973 $13,917

Florida Statute §112.08(2)(b) ... After implementation of an approved plan, each local governmental unit or consortium shall annually submit to the Office of Insurance Regulation a report which includes a statement prepared by an actuary… as to the actuarial soundness of the plan. The report is due 90 days after the close of the fiscal year of the plan.

Review of 112.08 Filings Show:

• Since 2006, small increases in funding have been consistently recommended

• These small increases have not been implemented and have increased in size annually

• As reserves decreased, recommendations have increased exponentially

• In 2006, the Premium Holiday was given even though a funding increase was recommended and not fully implemented.

Review of 112.08 Filings Show:

• Insurance deficit occurred from inaction on recommendations unknown to employees

• Employees already face economic pressure from stagnant wage rates, inflation, 3% FRS state tax, and reductions in hours

• In addition, the District has proposed an exorbitant cost shift to the employees for health care

• Employees should not be responsible to make up for the District’s failure to act in a timely manner!

Comparison of District Proposals January to July 2011

January July

CYD - Individual/Family $1500/$3000 fam. $1,500/???

Max Out of Pocket $5000/$10,000 fam. $6,000/???Coinsurance 25% 25% Coinsurance

HRAHRA Plan - Amount not Specified

$0.00

Premium for Employee $20.00 - Monthly $50.00 - MonthlyPremium for Spouse $542.80 - Monthly $550.00 - MonthlyPremium for Child $135.70 - Monthly $150.00 - MonthlyPremium for 2 Children $271.40 - Monthly $300.00 - MonthlyPremium for 3+ Children $450.00 - Monthly

Board Contribution $440.00 - Monthly 503.61 - Monthly

Clinics None 1 in 20121 in 2013

What Do We Know?

1. Your employees need affordable health care2. District has limited resources

• General Fund Balance allows some temporary relief

3. We must invest wisely for the future• Wellness Programs are proven• District run Free Health Clinics • Review current use of benefits

Cost of our Pharmacy Benefit was controlled

District’s Proposal will:• Create economic discrimination for access to health

care.

• Cause economic devastation through increased medical debt.

• Cause higher health care costs for the District, Employees, and the Community because of postponed health care.

• Have a negative impact on student achievement due to increased absenteeism.

Collaboration – Not Impasse or Unilateral Decisions• Continue this Hearing and reopen Bargaining• Invest in your employees by granting greater flexibility

in Plan Design and Funding to your Bargaining TeamOR

Impose PEA’s recommendation based upon• Better than expected Fund Balance• Devastating harm to employees and the community of

the District’s proposal• Concern about increasing employee turnover

A Health Insurance Resolution Requires:

• Works well when collaboration exists

• PEA President appoints most effective representatives

• Retain Current Contract Language

Superintendent’s Insurance Committee

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Personal Impact Examples

Marianne CapozielloPEA President

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Closing

Marianne CapozielloPEA President