A deadline imposed by recent legislation could see the pockets of public education employees aching and a mass retirement that could leave school systems in shock half way through the school year.
Some school system leaders are hoping an expected special session in November will change that Dec. 1 deadline to the end of the 2011-2012 school year.
With the deadline currently in place coming in the middle of a school year, Escambia County Superintendent Billy Hines, who announced his own retirement earlier this month, said school systems statewide could be facing some major problems in the near future.
“What it says is if you retire after Jan. 1, you will pay a 2 percent sliding scale insurance increase until you’re eligible for Medicare,” Hines said. “It only builds for five years, but the thing is you’re looking at a lot of money.”
The hike in prices comes as part of the recently passed Public Education Employee’s Health Insurance Plan, which will significantly raise premiums between retirement and age 65 for employees who are eligible to retire, but choose not to before the deadline.
For many teachers with over 25 years in the system and even longer than a decade before age 65, the decision may also seem like a given.
Hines, who had voiced plans to retire at the end of the 2011-12 school year, said the new plan certainly sped up his own personal decision to leave by the end of the calendar year, but added the decision to retire early might not be as easy for others in the school system.
“I didn’t make it a secret I was going to retire at the end of my term anyway,” Hines said. “So it really wasn’t as big a decision for me as it is to teachers with 30 or 31 years that hadn’t planned on retiring. For me it was a no-brainer because why would I want to pay a penalty for the next 10 years when I can be grandfathered in?”
Brewton City Schools Superintendent Lynn Smith said his system could be facing similar issues with more than a dozen school personnel eligible for retirement this year.
“When we looked at this we realized we had 14 people who would be eligible for retirement,” Smith said. “That included teachers and support personnel. We sat down and started running some figures to see what could be done. We had a couple of employees who would benefit from retiring before the deadline.”
State Rep. Alan Baker, R-Brewton, said that the bill passed along with an identical plan for Alabama state employees who would not be as adversely affected by the Jan. 1 deadline.
“There were two separate bills with the same action being taken,” Baker said. “One was for state employees and then the other would be for education employees, so there were two separate bills each had the same effect.”
Baker said the original deadline for the bill had been set during the summer months of 2011, but said because of session constraints had to be moved back.
“When that bill was filed back in the general session it had an effective date of July 1, this past summer,” Baker said. “If we did conclude our last day on June 9, which we did, that gave the state employees or the educational employees no opportunity to even file for retirement. They were asking 30 days notice so with the initial effective date of July 1, (2011) that meant that no employee hired by the state had an opportunity to escape that. They would all fall underneath the sliding scale application.”
With the current deadline looming, Smith said his system is looking at only two employees to be affected by the decision, while Hines said his system could see more.
“We’ve got 50 teachers that could probably qualify to do it,” Hines said. “Now will we have 50 retire? No. But we have 50 that would fall into the category. We’ve got about 30 or 40 support people that would fall into that, including bus drivers, lunchroom workers and all that. But every county is in this situation. We’re not the lone ranger.”
Escambia County has already seen two school system employees unexpectedly retire. “I had an aide retire Dec. 1, and I had a teacher retire December 1 at the last board meeting,” Hines said.
Smith said the two teachers in the Brewton City Schools system plan to stay.
“They know that retiring in December would probably be in their best interest but they are committed to staying on to the end of the school year,” he said. “If the new deadline passes, we can let them know that staying on would not penalize them.”
Hines said even changing the deadline could cause the possibility of confusion and disorganization.
“These teachers retire, so we advertise for their positions,” Hines said. “Well, if the legislature changes the date in November, these teachers may want to stay on. Look what we’ve done. We’ve already advertised for the job and we’ve interviewed.”
Baker said he is hopeful the Legislature will have an answer for Alabama employees by the middle of November.