OCPS: Extra bonuses for experienced teachers not possible

The Orange County school district cannot afford a “longevity supplement” for its veteran teachers and must raise some health insurance costs to keep its plan financially stable, one of its attorneys wrote as the ongoing dispute over compensation continued between the school system and its teachers’ union.

In his memorandum filed with Public Employee Relations Committee, attorney John Palmerini said Orange County Public Schools rejected as too expensive recommendations made by a special magistrate last month.

Special Magistrate Dennis Campagna weighed in on the fight after the union and district administrators could not negotiate an agreement on salaries and other compensation issues. His ruling, issued after a two-day impasse hearing, is not binding, however, and a final decision rests with the Orange County School Board.

The school board has not yet set a date to take up the matter. Superintendent Barbara Jenkins has until Thursday to recommend how she thinks the dispute should be settled.

Campagna, in his decision last month, agreed with the district that because of state budget cuts it could not afford anything more than tiny raises this year. Most teachers would get a pay hike of $175, under the district’s proposal, as well as one-time supplements and bonuses of up to $3,500.

Campagna wrote that he thought an additional “longevity supplement” also was doable and that plans to hike health insurance costs were “unconscionable.”

The union proposed raises of about $3,000 for most teachers and that those with five or more years experience also get extra supplements of $500 to $3,000. The union also wants health insurance costs to remain unchanged this year.

Union leaders argued the district has money in its $2.3 billion budget to cover those costs.

But Palmerini, the school board’s deputy general counsel, and other district leaders disagreed.

In his memo, Palmerini wrote that the extra supplement was part of a too-expensive union proposal that was not affordable in the face of a 3.5% cut in per-student funding from the state.

He also wrote that the district, which is self-insured, had to raise some insurance costs to keep enough money in its plan to meet state requirements. The district’s proposal is for “high utilizers of services to pay higher deductibles and out-of-pocket maximum costs,” he wrote.

The change likely would impact less than 2% of the 37,000 people insured by the plan, Palmerini added. The district would continue to pay the full premium cost for employees on certain plans and other costs would not change, Palmerini said.

The district’s insurance costs have gone up significantly in the last seven years, he said. The district paid out $150.4 million in claims in 2013-14, for example, and $252.1 million in 201920, he wrote.

By law, the district must keep enough money in its fund to pay for two months worth of claims. In the past, it has fallen below that limit and had to take money from other sources to “shore up” its insurance fund. If changes are not made to the plan, Palmerini wrote, experts predict it “will lose $14 million this year and will have the stabilization reserve fall well below two months of claims.”

Palmerini recommended the school board reject the “longevity supplement” proposed by the union and raise insurance costs as its staff suggested.