To save, district pulls back carrot for early retirement, critics warn of costs

By Emily Richmond

Tuesday, Nov. 11, 2008 | 2 a.m.

The Clark County School District will suspend a program that encourages longtime employees to retire early.

Ending the incentive, originally intended to help the district shed its most expensive employees, will save about $2.5 million a year and follows a state directive to prepare budget cuts of $120 million in the district for the next biennium.

With the district facing deficits, in dollars and experienced educators, it can’t afford to encourage veterans to leave, officials said.

“I have every bit of empathy for the employees who were looking forward to this (retirement incentive) sometime in the future,” Superintendent Walt Rulffes said at Thursday’s School Board meeting, where the panel voted to suspend the program. “But we’re looking at trade-offs now.”

But some employees criticized the move, saying it’s shortsighted and will end up costing the district more money in the long run.

The program allows employees — teachers, administrators and support staff — who have 15 to 29 years with the district and have accrued at least 110 days of sick leave to convert some of the unused sick days into credits toward retirement. The greater the number of unused sick days, the greater the district’s contribution toward credits with the state’s Public Employees’ Retirement System.

Elementary literacy specialist Lynn Gustafson told the School Board that suspending the provision is a blow to the “long-term employees who are dedicated to the efficient running of our schools.” It will also increase employee absenteeism, she said.

“If there is no long-term incentive for any of the employees ... to use their sick days very sparingly, I think you will see efficiency and morale decrease at all levels in a way you can’t put a dollar figure on,” Gustafson said. “The cost of hiring substitutes will offset the gains of suspending this program.”

Next week, the district will hold town hall meetings to ask the public to prioritize budget cuts. The early retirement incentive landed on the chopping block early because regulations require employees receive at least six months notice of any changes to retirement regulations, Rulffes said.

The incentive program, which has typically drawn the participation of 110 to 125 employees a year, will be suspended in August.

During the 2007-08 academic year, 233 employees cashed out early, putting the district’s costs at $4.2 million. The spike was due to a Sept. 1 deadline for district employees to sign up for subsidized retirement health coverage through the state’s health plan.

The district’s licensed personnel, who include teachers, school nurses, psychologists and speech pathologists, still have an early retirement option. Under the terms of the negotiated contract, licensed personnel with 29 years tenure at least 100 days of sick leave can retire early, with the district picking up the cost of the 30th year’s retirement credit.

Ruben Murillo, president of the Clark County Education Association, asked the School Board to hold off on suspending the policy until January, when the union and district sit down to hash out the next contract.

Though the incentive program is not subject to collective bargaining, it would show good faith for the district to wait and “talk about possible solutions,” Murillo said.

There have been opportunities for the union to ask for a sit-down. The district first brought the incentive program up for discussion in February.

But Stephen Augspurger, executive director of the district’s administrators union, said given the ongoing budget crisis the district would be better off without the policy.

“Philosophically, the regulation is designed to encourage our most experienced administrators to leave early,” he said. Given that a third of the district’s principals have three years or less experience in the post, “now is not the time to tell your most senior people to leave.”