Mike Nehf.....you really do have a dog in this fight, don't you?
On Friday, Michael Nehf, executive director of STRS, called for Kasich to drop his plan because it would ruin the earlier proposal.
State Rep. Lynn Wachtmann, who proposed the bill already in the legislature, said lawmakers will have to sort out the different plans. He said he does not think the legislature will increase employee contributions by 3 percent on top of the increase to 12 percent that Kasich proposed.
By Patrick O'Donnell
Gov. John Kasich's plan to have public employees pay more into their retirement plans while their employers pay less would save school districts $229 million a year, according to the Ohio Office of Budget and Management.
In all, that would save Ohio school districts more than half the $400 million in the state aid that Kasich would cut by 2013. But the actual amounts realized by individual school systems can vary widely.
Ten school districts in Northeast Ohio would see their pension costs fall by more than $1 million a year, with Cleveland saving $8.7 million, Akron almost $3.9 million and the Parma schools nearly $1.7 million, should the state legislature approve the plan.
For Cleveland, that would turn a nearly $1.8 million aid cut next school year into just short of a $7 million gain. Euclid schools would see their aid reduced by about $555,000 but would save $993,000 in pension costs. A small number of districts, like East Cleveland, would gain more aid and save on pensions.
Yet, in other Cuyahoga County districts, like Brooklyn, Chagrin Falls and Westlake, the pension savings would cover only a fraction of the aid cuts.
Tim Keen, director of the OBM, stressed the pension changes make up much of the losses in aid, particularly for the poorer districts.
"We're trying to ensure that the districts that have trouble raising money locally and depend on state aid are protected," he said.
Kasich spokesman Scott Milburn said changes in aid to districts should have been anticipated.
"We're also giving schools powerful tools to cope with them," he said. "One of those is reducing personnel costs."
Kasich's plan calls for school districts and employees to pay equally for the employees' retirement plan. School employees -- teachers, bus drivers, custodians, aides and administrators -- now pay 10 percent of their salary into the State Teachers Retirement Plan or School Employees Retirement System while districts pay 14 percent.
Kasich would have both sides pay 12 percent.
The savings estimate is based on payments to STRS and SERS for the employees' share in the 2009-10 school year. Actual savings to each district -- and cost to teachers, bus drivers, janitors and administrators -- will vary depending on number of employees, future salary amounts and how much of the employee share that districts pay for employees.
Kasich's proposal is not popular with unions representing the employees.
"It's a 2 percent pay cut for Ohio's public employees," said Michelle Prater, spokeswoman for the Ohio Education Association teachers union.
Van Keating, director of management services for the Ohio School Board Association, said the change would not make up for lost state aid in most districts. And, he said he expected employees will want their losses offset by higher salaries.
"If the employees have to pay it, they will be looking for schools to make it up," Keating said.
The state legislature was already considering increasing employee contributions to keep struggling pension plans afloat. Under those proposals, teachers and administrators would have their contributions to STRS rise from 10 percent to 13 percent, while keeping the district share at 14 percent.
On Friday, Michael Nehf, executive director of STRS, called for Kasich to drop his plan because it would ruin the earlier proposal.
State Rep. Lynn Wachtmann, who proposed the bill already in the legislature, said lawmakers will have to sort out the different plans. He said he does not think the legislature will increase employee contributions by 3 percent on top of the increase to 12 percent that Kasich proposed.
To reach this Plain Dealer reporter: paodonnell@plaind.com, 216-999-4818
posted by Kathie Bracy at 10:33 PM
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