David Michael Miller
There must have been concern in Gov. Scott Walker’s office when an increase in per pupil aid was written into the state budget. By giving districts a $200-per-student boost in funding, had the governor gone soft on public schools? Sure, this would help Walker with moderates, but conservatives need to see that Walker is still the stern union-buster of years past.
So the governor decided to do what he always does in times of need — kick some dirt in the face of Madison. The funding increase now comes with strings. Districts can only get it if they have their employees pay 12 percent of their health insurance premiums. There are many districts outside of Madison where employees don’t pay 12 percent of their benefits but it’s no secret that the clause was written specifically to dig on Madison.
Currently, Madison school district employees pay for benefits on a progressive scale, ranging from lower-wage employees who pay 1.5 percent of their benefits all the way up to administrators who pay 10 percent. Employees choose from one of three HMO plans, from the cheaper Group Health Cooperative (GHC) to more expensive plans offered by Dean and Unity. Full disclosure, my partner is a school employee and we get our GHC health insurance through the district.
An increase of $200 more per student is a lot of money and I can’t begrudge the district for taking it. However, Walker’s 12 percent figure for employee compensation is the definition of arbitrary. It doesn’t specify how generous the benefits package can be, or specify other categories of employee compensation. Districts can pay teachers whatever they want, just as long as their fringe benefits come with a random percentage price tag.
The district’s current benefits package, based on 2015-16 statewide data from the Department of Public Instruction, falls in the middle of the pack in terms of average costs; Madison ranks 199 out of 446 districts. District administrators, the local teacher’s union (Madison Teachers Inc.), and the three HMOs have negotiated to provide employees with a good benefits package without gouging taxpayers.
Increasing employee contributions won’t save taxpayers anything. The district will likely take the money they expect to get from increased contributions, and give it back to employees in the form of increased compensation — aka a raise. It’s a disruptive cost transfer with no savings.
I expect these attacks on local control from a governor who cares more about his next election than actual governing. What’s irresponsible about this punitive funding scheme is the absurdly short timeline. Districts need to have the 12 percent contribution in place for the 2017-18 school year.
Madison’s contracts with its three HMOs operate on a fiscal year that starts July 1. But negotiations start in December or January. Negotiations were well underway by the time Walker introduced his budget. The parties had to start from scratch with an abbreviated timeline and under radically different conditions.
With a 12 percent employee contribution, it is assumed that more customers — particularly the young and healthy — will switch from Dean and Unity to the cheaper GHC to save money. That leaves Dean and Unity with the older and more expensive customers. Prices at Dean and Unity would likely go up, which would, in the end, cost Madison taxpayers more money. Great savings, governor!
The district is also considering offering just one HMO, GHC. Under this plan, district employees and their families on Dean and Unity would lose their current doctors. Unlike Dean and Unity, GHC has no clinics outside of Dane County, a major hassle for the more than 100 employees and their families who don’t live in the county.
The decision to switch from three HMOs to one is a big decision and it shouldn’t be made on a short timeline. The district should have time to hold public hearings and evaluate the fiscal impact for taxpayers and employees alike.
The abbreviated timeline means that the district has to lock in contracts based on prospective — not final — budget language. According to Doug Keillor, executive director of Madison Teachers Inc, the district will have to finalize its contracts in a matter of weeks. Nothing in the budget will be certain for months; a final vote is not likely until June or even July.
The Legislative Fiscal Bureau estimates that Walker’s budget will create a structural deficit of around one billion dollars. Legislators might start looking for things to cut. The per pupil aid increase could get trimmed back significantly or even eliminated entirely. The school board has to decide policy by taking a guess on what the Legislature will do.
It doesn’t have to be this way. If the governor had tied his contribution increase to the per pupil aid in the 2018-19 school year, the Madison school district would have been able to sit down to the negotiation table with the usual timetable and a locked-in budget.
If Walker is going to make yet another attack on Madison’s self-governance, he could have at least afforded us the time to minimize the damage.