Retirement of 27 Shaler Area teachers to help balance budget
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A slew of retirements may help Shaler Area School District hold the line on taxes next year.
Thanks to a one-time retirement incentive offered by the district, as many as 27 teachers and 10 support personnel are set to retire earlier than originally expected, helping to reduce payroll costs and help balance the budget for the 2011-12 school year.
The school board already passed a resolution at the end of last year to hold any tax increases to within its Act I Index rate of 0.48 mills. This is a step Shaler traditionally takes, according to Charles Bennett, director of business affairs.
Unlike many Western Pennsylvania school systems, Mr. Bennett said, Shaler will not be hit with a large bill to cover Public Employee State Retirement System costs. For next year, at least, the district's budget for this cost is 80 percent funded. "We're covered next year," Mr. Bennett said.
He said the pension crisis came about because the state Legislature used investments to fund the state's portion of the plan. When markets began to fail in 2008, profits shrank, and school districts have been required to fund the shortfall.
He said Shaler Area maintained its budget line for pensions through the good times, and has money in reserve it can use to offset the increase this year.
In addition, the administration expects only a 2 percent increase in employees' health care costs, a 3 percent rise in transportation costs and other expenses to be contained because the district has agreements that lock in utility costs, according to Mr. Bennett.
"Of course we can't change the weather," he quipped. "But we're just looking at some belt tightening. I don't expect anything out of the ordinary."
What may hinder the board's plan to hold taxes completely is the anticipated end of stimulus funding.
"We're afraid the stimulus money will go away," Mr. Bennett said. He said the state used federal stimulus grants to supplant education funding. "If that money is not there, we may have to come up with the difference."
Shaler Area, along with most other Pennsylvania school boards, is waiting for Gov. Tom Corbett to unveil his budget in March to see the impact any state cuts will have on local budgets.
In the meantime, the board and administration are determining which teachers will need to be replaced with entry-level teachers and which can be eliminated.
Once kindergartners are registered and the secondary students have signed up for their electives, the board will know what the district's special education needs will be and if any low-enrollment classes can be discontinued, he said.
Superintendent Donald Lee said offering the retirement incentive was the best way the district could save a lot of money.
"We'll save about $30,000 on each teacher we replace and up to $100,000 on those we don't replace," he said. "We're restricted by Act I and unless we have substantial declining enrollment, we can't eliminate teachers. That's why we offered the retirement incentive this year."
In the meantime, administrators already are wondering what challenges the following year's budget may bring. Contracts for teachers and support personnel expire in 2012.
First Published February 3, 2011 12:00 am