2. Legislative Update
Kalamazoo RESA Employee
MPSERS Reform Compensation and Benefit
Personal Property Tax Repeal changes for 2012-2013
Teacher and Administrator school year
Evaluation
School Aid Budget
Highlights of State of the State Kalamazoo RESA
Impact for Kalamazoo RESA Program Highlights and
Knowns and Unknowns new initiatives
3. Senate bill as passed by the Senate and
House bill as introduced by the House Senate:
Future compensation would no longer include New employees healthcare benefit would be
tax sheltered annuities or longevity pay eliminated and replaced with 401(k) account
New employees reportable income capped Existing and future retirees pay at least 20%
at $100,000 of health care premiums
Employee hired before July 1, 2010 would be House bill differences:
required to make one of the following elections:
Higher contributions to keep 1.5 multiplier
New employees would join the Hybrid
Keep current contribution level and move to a
pension system
1.25 multiplier for future years
Freeze pension benefits and move to a defined
Changes in employer contribution calculation
contribution plan for future years
methodology
Hybrid employees would not be affected by
Still analyzing this bill – more information to
these pension changes
come at a later time
New employees would become part of the new
defined contribution 401(k) system
4.
5. The State of Michigan has balanced
their budget
Major tax restructuring has increased revenue
to the General Fund and significantly
reduced revenue to the School Aid Fund
$1.8 Billion reduction in business tax liability
Unemployment rate improving at 8.3%
(April 2012)
Modest gains in employment
Modest gains in sales tax and income tax
revenue levels
Statewide estimate for wage growth for FY
2013 is .5% - 1.5%
6. Three varying versions: ISD State Aid ($-5% to +5%)
Executive, House, Senate
MPSERS contribution rate 27.37%
Major Factors: (from 24.43%)
Foundation allowance Continues transfers to community
($0 to $208/pp increase) colleges and universities
Kindergarten funding change Continues most categoricals at
(full day for full funding) current year funding
Best Practices language
(varies in each version) Kalamazoo RESA’s strategy
is to balance the budget
Consolidation of Services through various approaches
incentive grants
7.
8. Approved by the Board of
Education on May 17
Average of 1% increase in
salary schedules
Steps granted for all
eligible employees
Change in vacation day
accrual rules
Enhancement to exemplary
attendance policy
Cost to the budget
approximately $520,000
9. Increases:
MIP/Basic > From 24.46% to 27.37% +2.91%
Pension Plus > From 23.23% to 26.14% +2.91%
This is a 11-12% increase in costs when applied to wages
What Does This Mean?
General Fund = $175,000
Special Ed. Fund = $480,000
Total = $655,000
10.
11. Changed Health Insurance Plans January 1, 2012
Estimated 14% increase in employee
health/dental/vision/life/long-term disability insurance
January-June 2013
Still overall savings to the budget!
Comparison to Cap unknown until Nov or Dec 2012
What Does This Mean?
General Fund = $135,000
Special Ed. Fund = $480,000
Total Savings = $615,000
12. New director in place, new initiatives underway
Wellness Committee Humanex Venture Inclusion & Diversity
Operation with the belief Implement a hiring Committee
that an active, well- process which enables us
Embrace a culture
balanced lifestyle will to hire one more like our
where inclusion and
directly benefit our best, every time we have
diversity thrive
students, co-workers, and an opening
families Aspire to create an
environment that provides
Together, establish and every individual with the
maintain a healthy opportunity to participate
environment in our schools fully, including their many
that is both motivating and unique ways of
and supportive thinking, living, working,
and learning
13.
14. Increased Compensation Costs
Wages – Steps plus 1% = $ 520,000
Retirement = $ 655,000
Health Insurance = $(615,000)
Total Increased Costs = $ 560,000
Decreased Revenues
Education Jobs Act = $280,000
Taxable Value Decrease = $400,000
Grants ending = $394,500
Total Revenue Decrease = $1,074,500
Increased Revenues
Medicaid Billing = $400,000
New Grants = $106,000
Total Revenue Increase = $506,000
17. Rebalancing
budgets
Eliminating
positions
Spending down through
fund balance attrition
wherever
possible
Taking on new Pursuing more
initiatives grant funding
