|
Issues
regarding education have heated up in many states. This education roundup
covers recent news.
$800 Million Budget In New Jersey
The Star Ledger is reporting Gov. Chris Christie
plans to cut N.J. school aid by $800M.
Gov.
Chris Christie's budget includes an across-the-board cut in state aid to
school districts that will equal up to 5 percent of their budgets for the
current fiscal year, a move the administration expects to be challenged in
court, according to three state officials familiar with the plan.
By basing the aid calculation on districts' budgets, the overall reduction of
about $820 million is at odds with New Jersey's school funding formula, which
dictates that more money go to districts with the neediest children,
officials said. That formula, which survived a Supreme Court challenge last
spring, replaced the longstanding "Abbott" system that sent the
bulk of the aid to 31 poor urban districts.
The cuts to schools come on top of $475 million that Christie sliced from
school aid in the current fiscal year. Those cuts were based on districts'
excess surplus.
In addition to schools, Christie's first budget will make major cuts in aid
to towns and colleges while skipping a $3 billion payment to the struggling
state pension system, said four officials who spoke on the condition of
anonymity ahead of Christie's speech.
The Republican governor on Tuesday also plans to propose slicing municipal
aid by $445 million and aid to public colleges by $175 million, the officials
said. That includes about $270 million in standard state aid to all towns,
with the remainder coming from eliminating special municipal aid and
extraordinary aid — two funds that help municipalities in distress, but
have been criticized by Republicans as a crutch discouraging better fiscal
management.
I
commend the governor's efforts across the board.
Christie Proposes Constitutional Amendment To Cap Tax Hikes
Please consider Christie will
propose constitutional amendment to cap tax hikes in N.J. budget
Gov.
Chris Christie will propose a constitutional amendment limiting annual
property tax increases to 2.5 percent when he introduces a budget Tuesday
that will seek fundamental changes in spending at every level of government,
according to administration officials with knowledge of the plan.
Christie will also propose converting the state’s property tax rebate
checks into direct credits on homeowners’ tax bills, eliminating what
was once considered an almost untouchable fixture of New Jersey government
and politics because of its popularity among voters. Some homeowners may still
receive a refund, but the envelope from the state treasury containing an
actual check that has arrived almost every summer for 30 years would be gone.
The governor’s $29.3 billion budget will shave $2.9 billion off state
spending from last year, about a 9 percent drop. The cuts include reductions
in aid to municipalities and school districts, said two officials, who spoke
to The Star-Ledger on the condition of anonymity ahead of the speech.
Unlike the current 4 percent limit, the new "hard" 2.5 percent cap
on municipal, school and county property tax levies would be
all-encompassing, without exceptions for such essentials as rising health
insurance or debt payments. The tax could be raised higher only if local
voters grant their approval in referendums. The state also would be
constitutionally barred from increasing its own spending on direct state
services by more than 2.5 percent per year.
I
applaud those efforts as well.
800 Layoff Notices in San Bernardino
The San Bernardino Sun is reporting Hundreds of teachers get preliminary layoff
notices
Nearly
800 teachers at some of the San Bernardino area's largest school districts
could lost their jobs by the start of the next school year after receiving
pink slips in recent weeks.
Hundreds more teachers at smaller districts also were warned.
March 15 is the annual deadline for school districts to send preliminary
layoff notices to teachers and other certificated school staff in California.
The decision on actual layoffs is made by May 15, the state deadline for
final notification.
It is a situation of great concern, said Jack O'Connell, state superintendent
of public instruction.
"Our state budget crisis has forced districts to lay off thousands of
teachers over the past few years. And now the governor has proposed cutting
another $2.4 billion from public education," he said.
"While I understand the governor and the legislature have tough
decisions to make, these budget cuts are devastating to our schools and
impacting our ability to do the most important job in our society. That is,
to teach our children."
If
teachers and administratiors want to do something other than whine, they
should persuade the teachers' unions to accept some benefit cuts. The fact of
the matter is not a single teacher needs lose a job.
Stimulus money was already wasted preventing layoffs. Let us hope more
stimulus money does not put off the inevitable once again. Pension benefits
must be cut.
Rhode Island Teachers’ Salary Cut Upheld By Superior Court
Please consider R.I.
teachers’ salary cut is upheld by court.
In
a ruling that could alter the future of collective bargaining for municipal
workers in Rhode Island, a Superior Court judge has upheld the East
Providence School Committee’s decision to unilaterally cut
teachers’ salaries and force a 20-percent contribution to their health
insurance costs last year.
Facing a deficit of more than $4 million, the board made the reductions in
January 2009, saying it was necessary to comply with a state law that says
school districts can’t deficit spend.
The board’s lawyers also argued that the committee was able to make the
changes without the consent of the local teachers union because there
wasn’t a contract in effect for the almost 500 teachers. The last
agreement with the East Providence Education Association expired on Oct. 31,
2008.
“... When the parties have reached an impasse in negotiations and their
actions are not governed by a binding collective-bargaining agreement, a
committee can make unilateral changes when faced with an actual
deficit,” Judge Michael A. Silverstein said in his written decision
released Monday.
Local teachers union president Valarie Lawson declined to comment Monday, but
Mayor Joseph S. Larisa Jr. said the decision is a “sound interpretation
of Rhode Island law” and “vindicates the unprecedented and heroic
action” taken by the School Committee.
“The School Committee used the savings to balance the school budget
without attacking our hard-hit property taxpayers,” Larisa continued.
“It also allowed the School Department to invest, wisely, school
resources directly in the kids, where it should have been in the first
place.”
“Had we lost this case, EP would have been between a rock and a hard
place, with a several-hundred-dollar tax increase on each homeowner, or
bankruptcy as the only two options for the city.”
This
is a start of hopefully more sensible court rulings to come. Note that
bankruptcy was the alternative.
Lancaster Pennsylvania Pension Tsunami Threatens Schools
In Lancaster Pennsylvania 'Pension tsunami' threatens schools
Mike
Leichliter doesn't want to increase class sizes, charge fees for pupils to
play sports or cut back on counseling services for kids with drug, alcohol
and emotional problems. But the Penn Manor School District superintendent
said those cost-saving measures might be necessary in the next few years to
pay for rising pension costs.
The bottom line: Pennsylvania and its public schools are facing a financial
nightmare of historic proportions.
And taxpayers are caught in the middle of it all.
Next year, the PSERS contribution rate will jump by more than 70 percent,
costing Lancaster County school systems — and taxpayers — an
extra $7.5 million.
But that's just a ripple compared with the wave that will crash down on
school budgets two years later, when the rate is projected to more than
triple, rising from 8.22 percent of employees' salaries to 29.22 percent.
It is projected that pension costs for the county's 17 school districts will
increase by a staggering $59.1 million over that period — with no
relief in sight.
Contributions will continue rising, peaking at 33.6 percent in 2014-15 and
remaining at 25 percent or above for the next 15 years, according to PSERS
projections.
"These rates are not 'spikes.' Rather, they are more like a 'launch'
because they do not come down for a long time," said Tim Shrom, business
manager for Solanco School District.
Teachers and other school employees have paid their mandated share of
contributions into the system every year without fail, while the state and
school districts have been underfunding the pension system by $600 million a
year, PSEA officials say.
Why, then, should their benefits be cut?
"We are going to do all we can to protect our members' benefits,"
PSEA treasurer Jerry Oleksiak said.
But lawmakers insist something's got to give.
"We've come to a time when the overburdened taxpayer has had
enough," state Rep. Gordon Denlinger of Narvon said in an e-mail.
"We face a square-off between the public-sector unions and the taxpayers
of the commonwealth."
Union Contributes
Pennies, Wants Millions In Return
PSEA treasurer Jerry Oleksiak asks "Why, then, should their benefits be
cut?"
The answer is the unions put in their "mandated share" which was preposterously
low for benefits received. Moreover, most of the union contribution really
comes from state matching contributions (in other words taxpayers). It's like
throwing a penny in a jar 8 feet tall and 3 feet wide, while proclaiming
"We put in our mandates so taxpayers have to fill the rest of the
jar".
My proposed solution to this mess is bankruptcy. Taxpayers have had enough of
public union leaches.
Please read that last article again. Lancaster County is in one of the
biggest messes you can find anywhere. I encourage the county to declare
bankruptcy. We will then see what benefits hold up in court. If it comes to
that, my hope is none.
Mish
GlobalEconomicAnalysis.blogspot.com
To
sign up for a free copy of Sitka’s Monthly Client Newsletter, please
register your email address at the bottom of the Sitka Pacific Commentary Page.
Mish's Global Economic Trend Analysis
Thoughts
on the great inflation/deflation/stagflation debate as well as discussions on
gold, silver, currencies, interest rates, and policy decisions that affect
the global markets.
|
|