The Next Level Teacher Compensation Commission released its report (pdf) on Indiana’s teacher compensation. Take anything I write here with a grain of salt — I’m just summarizing it as I go and might be making some mistakes. The Commission says that average teacher compensation should be raised to $60k to be competitive. (I don’t know if that’s inclusive of benefits or if that’s just straight salary). The report says that the $41k Indiana teachers averaged in 2000 would now be about $62k if it had held pace with inflation. (It did not). We’re at about $51,000.
To find the funding to increase teacher compensation to these levels, the Commission recommends:
- Forcing working spouses off of teacher health benefits packages and make them use their own company’s benefits (assuming, I guess, that their companies will offer something comparable.)
- Forcing Medicare-eligible retirees off of teacher health benefits package.
- Adopting the State’s pharmacy benefit plan.
- Centralized procurement.
- Joining liability risk pools.
- Firing surplus teachers and using their old salaries to supplement existing teachers’ salaries.
- Privatize non-teacher positions (e.g. custodians, etc.)
- Pass operating referendums.
- Set up an Education Foundation to receive charitable contributions.
- Increase salaries in areas where teacher demand is higher and/or where students need more attention.
On the state level, the Commission recommends, among other things:
- Paying down pension liability costs,
- Establishing an “efficiency division” in State government to help schools become more efficient and set efficiency standards.
- Have School Districts consider consolidation when their superintendent announces a retirement or resignation.
- Exempt schools from the mandatory $1 sale of public school buildings to charter schools if the public school consolidates with another district.
- Eliminate the 529 plan tax credit for households making over $150,000 and divert the resulting tax revenue to teacher compensation.
- Allow townships to fund school capital projects.
- Modify requirements for TIF districts.
- Allow schools with large cash reserves to deficit finance teacher compensation.
- Provide a tax credit for donations to programs that fund teacher pay.
- Allow operating referendum to stay in place until repealed rather than expiring every seven years.
- Implement a teacher pay “check off” on tax returns. (In other words, you can elect to donate $5 of your tax return to support teacher pay.)
- Require residential developers to pay impact fees to offset a need for school facilities created by the residential developments.
- Tax increase.
- Establish a minimum salary of $40,000.
- Limit the use of stipends (and make them part of base salaries) and set a compensation funding floor which would discourage schools from pocketing the savings when higher salaried teachers retire – instead making them plow that money back into the compensation pool.
- Require teacher compensation equal 45% of the State’s funding support amount.
- Increase the complexity funding component.
- Require districts to provide individual teachers with a financial breakdown of their total salary, retirement, and health benefits.
- Increase funding for recruitment of minority teachers.
- Establish a formal initiative to improve teacher recruitment and job satisfaction beyond compensation, including but not limited to promoting teacher residencies and reducing regulations affecting teachers.
Looks like they kind of threw the kitchen sink into these recommendations, so there is some good and bad. Because it’s so broad, I imagine the legislature can more or less do what it wants with the recommendation.
Maybe more later.
Parts of these proposals I really like in no particular order: Require residential developers to pay impact fees to offset a need for school facilities created by the residential developments. .Developers are getting away with murder in building sub-division after sub-division while ignoring the negative effects they are having on schools and infrastructure expenditures.
I am all for the a $40 grand starting salary for teachers. – The problem is in small town School Corporation usually a third of the teachers are presently below the $40 grand threshold. Lets play the old game, ‘Where is the money coming from?’.
Paying down pension liability costs, – Tax Increase
Tax increase. – I like this idea – of course I am in the minority. Strong schools make strong communities!
Modify requirements for TIF districts. – I need more details but I like the idea.
Allow townships to fund school capital projects. – Great idea well maybe – I would think townships might be able to do a better job vetting contractors for capital projects.
Here is my idea is have 5 – 10 heads of Maintenance of each High School Corporation meet and go over contractors that were hired for capitol projects and find out who the good contactors for each project, where the projects done on time, what was the quality and price, etc. Right now it seems the administration gets three bids and to many times the low bid wins. I would do this with any big ticket items, IT managers could meet and follow the same procedures to bring down IT costs.
Forcing Medicare-eligible retirees off of teacher health benefits package – A given.
Another idea missing which is already being done on the south and east side of Indy. Setting up a trust with other school districts to purchase health insurance. The more teachers, staff and administrators enrolled in the plan will bring the costs down for the school corporation and the employees enrolled in the program.
So many ideas on this list lets hope the school corporations and the State of Indiana can find it in their hearts to implement some of the better ideas.
Doug I assumed you talked to Amy Austin about what I sent her on the Insurance Trust, out of curiosity sake let me know (Amy has my email I think) if it goes anywhere. Thanks Phil
“Allow townships to fund school capital projects. – Great idea well maybe – I would think townships might be able to do a better job vetting contractors for capital projects.”
A vast majority of Township Governments haven’t attempted a capital project in years. In fact, in most areas the Township government is a guy in his house who works 3 hours a month on Township business. Making me (former contractor with 20 years of school business experience with 5 major building projects and countless minor capital projects to my name) rely on some schmuck who hasn’t run a project bigger than mowing cemeteries is silly. Heck, the ENTIRE budget for the 2 townships that comprise my school corporation was less than at least 3 of the capital projects I did this calendar year.
“Here is my idea is have 5 – 10 heads of Maintenance of each High School Corporation meet and go over contractors that were hired for capitol projects and find out who the good contactors for each project, where the projects done on time, what was the quality and price, etc. Right now it seems the administration gets three bids and to many times the low bid wins. I would do this with any big ticket items, IT managers could meet and follow the same procedures to bring down IT costs.”
Taking 3 bids and awarding the lowest is state procurement law. There is a ton of networking going on among school people already about best purchasing practice. There are huge multi-corporation buying cooperatives, a state led buying cooperative and multiple national buying cooperatives. This isn’t breaking new ground and is the typical insulting crap school people deal with all the time. Just because I run the finances for a school doesn’t mean I am out there pissing away money due to lack of smarts and savvy.
Also, there are not such thing as “High School Corporations” in Indiana.
“Another idea missing which is already being done on the south and east side of Indy. Setting up a trust with other school districts to purchase health insurance. The more teachers, staff and administrators enrolled in the plan will bring the costs down for the school corporation and the employees enrolled in the program.”
I have been a part of 3 insurance cooperatives, have helped run the State of Indiana Health plan and now run a self-insured plan for just one school corporation. Cheapest insurance on a PEPM basis is the current school. We pay less for our plan in total than my last school (in a fairly well run insurance trust) paid for their employer share and I pay about $6k less annually for a similar benefits plan. Now there are some schools that could really use a trust to get them out of bad situations, but claims experience, not size is the driver of insurance cots.
Paddy taking the lowest bidder is a state procurement law but it is not binding if the board decides otherwise – 36-1-12-4 (9) If the board awards the contract to a bidder other than the lowest bidder, the board must state in the minutes or memoranda, at the time the award is made, the factors used to determine which bidder is the lowest responsible and responsive bidder and to justify the award. The board shall keep a copy of the minutes or memoranda available for public inspection.
So I would assume if a million dollar bid was a couple of thousand dollars more then the cheaper bid the board could pick the higher bid stating the company had already done excellent work and was a better fit for the School Corporation.
I pretty sure I read that more then three bids can be taken for a project or purchase but only three would actually be submitted to the board. My memory is not what it used to be so don’t quote me on this.
Sorry I was thinking county (township is crazy because i know our township trustee and it’s only him) and there would be a board and other people who I would assume would have experience to pull things off.
I understand the wellness plans help bring down health cost and of course preventive care does the same thing. What I was able to send Amy was the actual amount of cost the (the trust) teachers, support staff and the School Corporations are paying in 2021.. Plus all the plans information with the wellness plan. It wouldn’t take much to decide whether it would be a good way or bad way to go. Phone calls l to the insurance company’s for comparison pricing, plans and other pertinent information. Plenty of time don’t have to make any decisions till 3rd quarter of 2021. If it’s a go then the hard part checking with other school corps to see if it would be beneficial for them to join. With Covid I suspect that the administrators may have some time on their hands.
There is a ton of networking going on among school people already about best purchasing practice. There are huge multi-corporation buying cooperatives, a state led buying cooperative and multiple national buying cooperatives. I still think sometimes the buying decisions can be very questionable .Getting four or five people in the same room to compare notes couldn’t hurt. I won’t get into this I might just be in the wrong school district in Indiana. Grin! Smile!
Thanks for the info I have no problem when people show me the errs of my ways! Happy Holidays
“The Commission says that average teacher compensation should be raised to $60k to be competitive. (I don’t know if that’s inclusive of benefits or if that’s just straight salary).”
I’m pretty sure that figure doesn’t include benefits. I saw an AFT report fifteen years ago which said the average teacher salary in Indiana was like $53,000. So I am skeptical over the $51,000 figure. I can’t imagine pay having gone done, not even considering inflation.
I do wonder what they mean by raising pay to be “competitive.” “Competitive” with what? There are a lot of highly educated professionals out there that would are working a lot more hours than teachers and receive less pay and benefits. I’ve also talked to plenty of experienced teachers who were very happy with their pay…though they always complain about working conditions including lack of support from the administration and parents.
It’s going to be a philosophical decision on what professions ought to be considered comparable to teaching. And part of that decision is going to involve whether we’re more focused on the current pool of teachers or more of an aspirational sense of the profession.
Ultimately, I think a world-class educational system is going to require that we attract some of the best minds we can produce. Part of that is cultural – just giving teachers respect, but part of it’s financial – paying them what we want them to be worth.
Remember when Mitch Daniels was a hero for getting the school general fund off of property taxes? This is the result.
I was opposed to the state take over when it happened (I was, and still am, opposed to the property tax caps)
The commission recommends referendums. I had not seen the recommendation for referendums to not expire. I can support this as I feel schools should be funded locally. And the current referendum law is terrible.
I like the residential impact fee as houses lead to families which lead to more and more kids in the system. This also impacts city/town and county government greatly.
On a side note I would like to see an automate levy increase quotient so the levy could increase as residential AV increases due to new construction. Similar to a max levy increase for an annexation.
Different taxing unit, but valid point. I was at a commissioner meeting to get a Cumulative Fire fund established for a fire district. This district’s operating fund is struggling due to massive growth in the district. They don’t have enough levy to keep up with the residential growth. The night the cum fund was established the commissioners also approved a 450 lot subdivision within the fire district. Good for the Cum Fund. Bad for the operating fund.
And add back in some options for max levy appeals. It’s nearly impossible to get a max levy increase.
Fire surplus teachers? What is a surplus teacher? Do any schools really have extra teachers just hanging around. This sounds like code for increase class sizes.
Townships to fund capital projects? What would matter if the school or the township take on the bond for a capital project? The debt rate is applied to the same people.
Require the district to provide a breakdown of salary, retirement, and health. This sounds like a way out. A way to say “you are actually making enough” and make no change.
“Paddy taking the lowest bidder is a state procurement law but it is not binding if the board decides otherwise – 36-1-12-4 (9) If the board awards the contract to a bidder other than the lowest bidder, the board must state in the minutes or memoranda, at the time the award is made, the factors used to determine which bidder is the lowest responsible and responsive bidder and to justify the award. The board shall keep a copy of the minutes or memoranda available for public inspection.”
And the lowest bidder then files an objection and ties you up in court.
Yes there are ways to avoid it, but it can be sticky.
I saw an AFT report fifteen years ago which said the average teacher salary in Indiana was like $53,000. So I am skeptical over the $51,000 figure. I can’t imagine pay having gone done, not even considering inflation.
Paul, you can find the most recent bargaining report summaries on Gateway: https://gateway.ifionline.org/report_builder/Default3a.aspx?rpttype=collBargain&rpt=ieerb_statewide_comparison&rptName=IEERB%20Collective%20Bargaining%20Statewide%20Summary
The last report shows the average pay is $53,463.
That site has a field labeled “rurality” – which is not a term I’d ever seen before.