I shoulda been a teacher in Wisconsin

[AlbqSooner]

Oh, To Be a Teacher in Wisconsin
How can fringe benefits cost nearly as much as a worker's salary? Answer: collective bargaining.
By ROBERT M. COSTRELL
The showdown in Wisconsin over fringe benefits for public employees boils down to one number: 74.2. That's how many cents the public pays Milwaukee public-school teachers and other employees for retirement and health benefits for every dollar they receive in salary. The corresponding rate for employees of private firms is 24.3 cents.
Gov. Scott Walker's proposal would bring public-employee benefits closer in line with those of workers in the private sector. And to prevent benefits from reaching sky-high levels in the future, he wants to restrict collective-bargaining rights.
The average Milwaukee public-school teacher salary is $56,500, but with benefits the total package is $100,005, according to the manager of financial planning for Milwaukee public schools. When I showed these figures to a friend, she asked me a simple question: "How can fringe benefits be nearly as much as salary?" The answers can be found by unpacking the numbers in the district's budget for this fiscal year:
•Social Security and Medicare. The employer cost is 7.65% of wages, the same as in the private sector.

•State Pension. Teachers belong to the Wisconsin state pension plan. That plan requires a 6.8% employer contribution and 6.2% from the employee. However, according to the collective-bargaining agreement in place since 1996, the district pays the employees' share as well, for a total of 13%.
•Teachers' Supplemental Pension. In addition to the state pension, Milwaukee public-school teachers receive an additional pension under a 1982 collective-bargaining agreement. The district contributes an additional 4.2% of teacher salaries to cover this second pension. Teachers contribute nothing.
•Classified Pension. Most other school employees belong to the city's pension system instead of the state plan. The city plan is less expensive but here, too, according to the collective-bargaining agreement, the district pays the employees' 5.5% share.
Overall, for teachers and other employees, the district's contributions for pensions and Social Security total 22.6 cents for each dollar of salary. The corresponding figure for private industry is 13.4 cents. The divergence is greater yet for health insurance:
•Health care for current employees. Under the current collective- bargaining agreements, the school district pays the entire premium for medical and vision benefits, and over half the cost of dental coverage. These plans are extremely expensive.
This is partly because of Wisconsin's unique arrangement under which the teachers union is the sponsor of the group health-insurance plans. Not surprisingly, benefits are generous. The district's contributions for health insurance of active employees total 38.8% of wages. For private-sector workers nationwide, the average is 10.7%.

Health insurance for retirees. This benefit is rarely offered any more in private companies, and it can be quite costly. This is especially the case for teachers in many states, because the eligibility rules of their pension plans often induce them to retire in their 50s, and Medicare does not kick in until age 65. Milwaukee's plan covers the entire premium in effect at retirement, and retirees cover only the growth in premiums after they retire.
As is commonly the case, the school district's retiree health plan has not been prefunded. It has been

pay-as-you-go. This has been a disaster waiting to happen, as retirees grow in number and live longer, and active employment shrinks in districts such as Milwaukee.
For fiscal year 2011, retiree enrollment in the district health plan is 36.4% of the total. In addition to the costs of these retirees' benefits, Milwaukee is, to its credit, belatedly starting to prefund the benefits of future school retirees. In all, retiree health-insurance contributions are estimated at 12.1% of salaries (of which 1.5% is prefunded).
Overall, the school district's contributions to health insurance for employees and retirees total about 50.9 cents on top of every dollar paid in wages. Together with pension and Social Security contributions, plus a few small items, one can see how the total cost of fringe benefits reaches 74.2%.
What these numbers ultimately prove is the excessive power of collective bargaining. The teachers' main pension plan is set by the state legislature, but under the pressure of local bargaining, the employees' contribution is often pushed onto the taxpayers. In addition, collective bargaining led the Milwaukee public school district to add a supplemental pension plan—again with no employee contribution. Finally, the employees' contribution (or lack thereof) to the cost of health insurance is also collectively bargained.
As the costs of pensions and insurance escalate, the governor's proposal to restrict collective bargaining to salaries—not benefits—seems entirely reasonable.
Mr. Costrell is professor of education reform and economics at the University of Arkansas.

[Leroy Lizard]

Oh, To Be a Teacher in Wisconsin
How can fringe benefits cost nearly as much as a worker's salary? Answer: collective bargaining.
By ROBERT M. COSTRELL
The showdown in Wisconsin over fringe benefits for public employees boils down to one number: 74.2. That's how many cents the public pays Milwaukee public-school teachers and other employees for retirement and health benefits for every dollar they receive in salary.

That must be a typo. Please proofread your posts before submitting. Thank you.

[AlbqSooner]

Please read the entire article before calling me out. Thank you.
"For fiscal year 2011, retiree enrollment in the district health plan is 36.4% of the total. In addition to the costs of these retirees' benefits, Milwaukee is, to its credit, belatedly starting to prefund the benefits of future school retirees. In all, retiree health-insurance contributions are estimated at 12.1% of salaries (of which 1.5% is prefunded).
Overall, the school district's contributions to health insurance for employees and retirees total about 50.9 cents on top of every dollar paid in wages. Together with pension and Social Security contributions, plus a few small items, one can see how the total cost of fringe benefits reaches 74.2%."

[Leroy Lizard]

Please read the entire article before calling me out.

I guess I need to start using the winky emoticon.

[tcrb]

Nice recovery.

[SanJoaquinSooner]

The numbers might be a little different, but this is basically the same problem we have in California - not just teachers, but across the board for public employees. Additionally they seem to be able to retire earlier than private sector employees do, often to get another job.

Employees need to pay at least 1/3 of medical and dental, and at least 1/2 of retirement. And **** medical for retirees.

[AlbqSooner]

The winky emoticon does not change the fact that your keyboard spews forth statements that you simply cannot support and that demonstrate clearly that you are posting on matters of which you have no knowledge. This seems to be your pattern.

[soonercruiser]

That must be a typo. Please proofread your posts before submitting. Thank you.



The showdown in Wisconsin over fringe benefits for public employees boils down to one number: 74.2. That's how many cents the public pays Milwaukee public-school teachers and other employees for retirement and health benefits for every dollar they receive in salary. The corresponding rate for employees of private firms is 24.3 cents.


Makes "cents" to me!
Wisconsin teachers get an extra 74.2 cents of benefits for every dollar of pay.

[soonercruiser]

Stossel (the Libertarian) had an expose' last night about the public transit unions (either NY or Chicago), and the numers were absolutely astounding!
Collective bargaining by public employess will be the death of the Republic.

[StoopTroup]

It sounds like Wisconsin did exactly what seemingly was the popular thing to do a long time ago...instead of a salary increase they offered fringe benefits as incentives over time. Now the amount of folks retiring is about to go up and they have avoided doing anything about it. Now our economy is in the crapper and instead of paying out larger salaries years ago and keeping the fringe animal the size of a chipmunk they are having to nuke the hogzilla. Getting rid of the fringe I thought had been addressed when the workers decided to take cuts. What is keeping this thing going is the attempt to get rid of collective bargaining. I'd like to have a huge group of captive workers that I could decide to cut their pay on Friday knowing I have a monopoly on their jobs. When we decided to make educating our children an entitlement in all of our States we signed up for this. Baby Boomers are suddenly the bad guys for working decades and negotiating their careers along the way. It's sad that Wisconsin got themselves into this situation and pointing fingers at one side or another isn't solving much it seems.

[TitoMorelli]

I know of several educators who have retired from Oklahoma schools relatively early, then moved to Texas or Arkansas to teach for several more years and earn a second pension. Just wondering, how much pension does a teacher receive if he/she takes early retirement in one state, then teaches for 5-10 years in a different state? And how are states able to afford it?

[soonercruiser]

It sounds like Wisconsin did exactly what seemingly was the popular thing to do a long time ago...instead of a salary increase they offered fringe benefits as incentives over time. Now the amount of folks retiring is about to go up and they have avoided doing anything about it. Now our economy is in the crapper and instead of paying out larger salaries years ago and keeping the fringe animal the size of a chipmunk they are having to nuke the hogzilla. Getting rid of the fringe I thought had been addressed when the workers decided to take cuts. What is keeping this thing going is the attempt to get rid of collective bargaining. I'd like to have a huge group of captive workers that I could decide to cut their pay on Friday knowing I have a monopoly on their jobs. When we decided to make educating our children an entitlement in all of our States we signed up for this. Baby Boomers are suddenly the bad guys for working decades and negotiating their careers along the way. It's sad that Wisconsin got themselves into this situation and pointing fingers at one side or another isn't solving much it seems.

Nice try Stoop!
But, do a little research and notice the relatively small percentage of all employees that have collective bargaining rights through unions.
Wonder how the country could possibly have gotten along with all those employees who aren't in unions?
:rolleyes:

[soonercruiser]

You know the answer Tito.
But, I have to admit, that's what I will be too, with 29 years military, and already qualified for OTRS. OUHSC got me pretty cheap (salary) as a military retiree. But, the retirement will be addative!

[TitoMorelli]

You know the answer Tito.
But, I have to admit, that's what I will be too, with 29 years military, and already qualified for OTRS. OUHSC got me pretty cheap (salary) as a military retiree. But, the retirement will be addative!

Then again, the average military career even for "career" men is significantly less than that of almost all civilian careers. Furthermore, army retirees, e.g., aren't allowed to then join the navy, put in five years, and get a second full pension. Correct?

Can't blame those who are willing to pull up stakes or to commute maybe a couple of hours or more to feather their retirement nest more richly. If the opportunity is there, why shouldn't they?

(Well, maybe except for the fact that I'm helping to pay for those additional pensions.)

[Leroy Lizard]

The winky emoticon does not change the fact that your keyboard spews forth statements that you simply cannot support...

Awww c'mon, it was a joke.

As in... this number is so ridiculous that a person would normally think it was a typo.

[AlbqSooner]

Awww c'mon, it was a joke.

As in... this number is so ridiculous that a person would normally think it was another failure to read the article before commenting.

FIFY

[AlbqSooner]

Then again, the average military career even for "career" men is significantly less than that of almost all civilian careers. Furthermore, army retirees, e.g., aren't allowed to then join the navy, put in five years, and get a second full pension. Correct?

Correct. They can, however, retire as perhaps a military firefighter and then take a job as a civilian firefighter on the same military installation.

[pphilfran]

Correct. They can, however, retire as perhaps a military firefighter and then take a job as a civilian firefighter on the same military installation.

My BIL retired a full bird...then worked for the fed in a different capacity...now is an independent contractor working for a brain trust supplying info to the war machine...

[SanJoaquinSooner]

Then again, the average military career even for "career" men is significantly less than that of almost all civilian careers. Furthermore, army retirees, e.g., aren't allowed to then join the navy, put in five years, and get a second full pension. Correct?

Can't blame those who are willing to pull up stakes or to commute maybe a couple of hours or more to feather their retirement nest more richly. If the opportunity is there, why shouldn't they?

(Well, maybe except for the fact that I'm helping to pay for those additional pensions.)

I don't know how it works in Wisc, but in OKla retirement pay is based of years of teaching times 2 percent of the avg of your highest 3 years of pay. So if you teach just 5 or 10 years you don't receive "full retirement."

[pphilfran]

I don't know how it works in Wisc, but in OKla retirement pay is based of years of teaching times 2 percent of the avg of your highest 3 years of pay. So if you teach just 5 or 10 years you don't receive "full retirement."

Here is the OK calculator...start working at 25 and retire at 55 and you get about half your salary...

https://www.ok.gov/TRS/bencalc/index.php

[IndySooner]

It sounds like Wisconsin did exactly what seemingly was the popular thing to do a long time ago...instead of a salary increase they offered fringe benefits as incentives over time. Now the amount of folks retiring is about to go up and they have avoided doing anything about it. Now our economy is in the crapper and instead of paying out larger salaries years ago and keeping the fringe animal the size of a chipmunk they are having to nuke the hogzilla. Getting rid of the fringe I thought had been addressed when the workers decided to take cuts. What is keeping this thing going is the attempt to get rid of collective bargaining. I'd like to have a huge group of captive workers that I could decide to cut their pay on Friday knowing I have a monopoly on their jobs. When we decided to make educating our children an entitlement in all of our States we signed up for this. Baby Boomers are suddenly the bad guys for working decades and negotiating their careers along the way. It's sad that Wisconsin got themselves into this situation and pointing fingers at one side or another isn't solving much it seems.

This. Iowa is fighting the same battle. My parents are both educators in Iowa. Dad is retiring this year, at 62. Mom will retire at 63. Both will be fine in retirement, thanks to their pension plan. Throughout my life, though, we struggled to get by. Dad coached when he didn't want to, was constantly in school to upgrade into administration and had summer jobs umpiring, painting and building for my entire childhood. The legislature made the choice NOT to raise salaries to fit the economy, but rather to build the pensions. So, Mom and Dad couldn't afford to put anything above and beyond to retirement, and instead, will live on the pension that the state agreed to.

Now the state wants to take that away, too. You can see why the teachers might be a little pissed.

[SanJoaquinSooner]

Here is the OK calculator...start working at 25 and retire at 55 and you get about half your salary...

https://www.ok.gov/TRS/bencalc/index.php

You mean 60% of your salary, don't you? 30 years x .02 = .60

[pphilfran]

You mean 60% of your salary, don't you? 30 years x .02 = .60

I entered some numbers into the calculator...might have been 60% or somewhere in that range...I would imaging the age at which you achieve 30 years impacts the amount you receive...who knows I didn't look that closely...

[SanJoaquinSooner]

This. Iowa is fighting the same battle. My parents are both educators in Iowa. Dad is retiring this year, at 62. Mom will retire at 63. Both will be fine in retirement, thanks to their pension plan. Throughout my life, though, we struggled to get by. Dad coached when he didn't want to, was constantly in school to upgrade into administration and had summer jobs umpiring, painting and building for my entire childhood. The legislature made the choice NOT to raise salaries to fit the economy, but rather to build the pensions. So, Mom and Dad couldn't afford to put anything above and beyond to retirement, and instead, will live on the pension that the state agreed to.

Now the state wants to take that away, too. You can see why the teachers might be a little pissed.

Yeah, each state may be a different situation.

The article in the OP stated that the state pays contributes a total of 17.2% of salary to the pension plan while the employees contribute nothing. That's beyond generous. It's fairly common in 401K plans for the employee to contribute 6% of salary with the employer contributing a matching 3%. Some may match a full 6% but it would be highly unusual to find anything
as generous as what the Wisc teachers are getting.


Also, I know in California, it seems there are lots of public employees who are somehow able to retire at 55. That leaves a long time for the tax payer to pick up the retirement tab.

[IndySooner]

Also, I know in California, it seems there are lots of public employees who are somehow able to retire at 55. That leaves a long time for the tax payer to pick up the retirement tab.

I'm sure that every state is a little different, but they're all fighting the same battle. I know my dad maxed his out at 30 years. He thought about moving down to Kansas City to continue building a pension. Interesting what some of the unintended consequences of these plans are, isn't it?

Instead, he retires at 62, and after putting in 40 years of LONG hours and many jobs, he will be able to live a decent, but not extravagant, retirement.

I do know that part of his check went into the pension plan, though when he got into administration, he (not a union) negotiated for at least part of that to be covered.

The bottom line for me is that the way we pay teachers is out of whack. There's no doubt about it. What the system needs, though, is a complete overhaul. Higher salaries, normal 403b plans, etc. We also need accountability and oversight that the unions aren't allowing us to have. Eliminating the unions, though, isn't an effort to overhaul the system, it's an effort to pay teachers LESS than they already are paid. That's not the answer.

[SoonerJack]

In Missouri, teachers currently kick in 14.5 % to PSRS and local boards match that percentage.

Back in the 90's when the stock market was going gangbusters, the board of PSRS voted to increase the multiplier from 2.0 to like 2.2. When the economy tanked, the General Assembly passed a law that said districts and teachers will increase by .5% the amount they contribute to PSRS until the retirement fund is 85% solvent.

14.5% is a hell of a chunk of a starting teacher's salary to push toward retirement.

[TUSooner]

....
Collective bargaining by public employess will be the death of the Republic.

Overstate much? :rolleyes: