Wednesday, May 11, 2011

No surprise on how NYSUT views their pension benefits

"Seeking to abolish basic labor protections or destroy the public pension system should not even enter the debate when we are discussing true mandate relief," Andrew Pallotta, executive vice president of New York State United Teachers, said at a state Senate hearing in February.
Pallotta called for reduced spending on charter schools and the spreading out of pension payments for schools.
I'm getting the message that New York teachers really want to keep their taxpayer-guaranteed pensions.  That might be hard to do, considering our state's economic crisis and that tax-funded annual contributions to the New York State Teachers’ Retirement System (NYSTRS) will more than quadruple over the next five years.

Read the entire story after the jump.

1:43 AM, May. 8, 2011 
Written by Gary Stern
The most-wanted political villain in New York state is so slippery, so evasive, so camouflaged by bureaucracy, that no one seems to know how to capture it.
And yet, everyone this side of Charlie Sheen agrees the monster known as "unfunded mandates" must be tamed if property taxes are to be controlled.
In fact, seven Westchester and Putnam school districts found that they spent between 15 percent and 28 percent of their entire 2008-09 budgets on questionable mandates hatched in Albany.
We're talking about a web of rules and regulations that the state imposes on school districts and municipalities, usually in pursuit of a public good such as accountability.
The problem is that every mandate has a price tag and unknowing taxpayers must cover the costs.
"Legislators talk the big talk, but we have to pay for it," said Karen Zevin, president of the Croton-Harmon Board of Education, who led the seven districts' study.
State mandates drive up countless local costs by, for instance:
• Requiring that construction projects use multiple contractors.
• Determining how much schools and municipalities must spend on pensions.
• Setting exhaustive requirements for special education decisions.
• Demanding the reporting of all sorts of data and numerous audits.
• Setting rules for everything from how many days off employees can take for health screenings to how often fire extinguishers must be inspected.
"Local governments are best equipped to make decisions for our residents, but we have to raise taxes to comply with the whims of Albany," said Ramapo Town Councilman Daniel Friedman. He said Ramapo had to increase pension contributions this year by $1.7 million to $5.7 million, requiring a 5.5 percent tax hike.
Most municipal and school officials want to see the pension system reformed, but labor unions will offer resistance to many changes.
A daunting task
A team appointed by Gov. Andrew Cuomo is trying to figure out how to target and zap some of the many mandates that cut across state government.
But a preliminary report released in March warned that it will take time to get a handle on one of the most convoluted subjects in the Empire State.
The team proposed a constitutional amendment banning new unfunded mandates. "It took decades to get to this crisis point," its report said.
It just so happens that the seven school districts in Westchester and Putnam may be the leading experts on Mandate-mania, having completed a detailed study that categorizes the mandates they must obey.
A cluster of districts calling themselves Regional Education Advocacy Districts — or READ — began meeting in 2004 to brainstorm on shared challenges. Since schools eat up about 60 percent of local property taxes, READ decided to show schools' limited control over many costs by preparing a detailed formula to identify mandates.
Seven districts deconstructed their budgets and found that they spent $89.6 million in 2008-09 — an average of 21 percent of their total budgets — on more than 90 state mandates that can be relaxed or eliminated.
The group ignored big-ticket items such as pensions and health-care costs or other mandates that they deemed necessary.
"You hear that no one can figure out the costs, but we did it," Zevin said.
The group found that special-education regulations ate up 72.6 percent of their total mandate costs. They also zeroed in on state-imposed expenses for testing, auditing, collecting data and all sorts of inspections.
"A lot of times, instead of educating kids, we're just dotting i's and crossing t's, which takes time and money," said Kusum Sinha, Croton-Harmon's assistant superintendent.
Growing anxiety
Public officials have long moaned about unfunded mandates, but the subject is now white-hot because of the financial stress facing schools and municipalities and a growing distaste for New York's highest-in-the-nation property taxes.
Many legislators also insist that if they are to consider Gov. Andrew Cuomo's call for a property-tax cap, they need to give localities a break from spending money they don't want to spend.
"The two have to go hand-in-hand or local governments will be hamstrung," said state Sen. Andrea Stewart-Cousins, D-Mount Vernon, who is part of Cuomo's mandate-relief team.
But E.J. McMahon, senior fellow of the Empire Center for New York State, a conservative think tank, contends that the Legislature will avoid mandate relief unless a tax cap forces lawmakers to seek savings.
"No cap, no mandate relief," he said.
Mandate relief is a rare political issue in that everyone agrees that it's necessary in some form. But decades of rules must be examined before they can be reformed or killed. Many mandates have supporters, whether few or many.
"Mandates start with somebody having good intentions, but no one asks us what the costs will be," said Garrison Superintendent Gloria Colucci, whose district took part in the study.
The 'cost-drivers'
Most complaints about unfunded mandates start with the biggest, most expensive items — often derided as "cost drivers." Chief among them are pension costs, which ate up 7 percent of property taxes collected outside of New York City in 2010, Cuomo's team found.
The team proposed in its March report a new pension tier that would, among other things, exclude overtime from pension calculations.
Other large mandate targets are the Wicks Law, which requires multiple contractors for big construction projects, and the Triborough Amendment, which maintains the provisions of an expired union contract until a new contract is reached.
Bill Mooney, president of the Westchester County Association and a member of Cuomo's team, said the team has been too tentative about tackling the costly issues.
"Maybe the strategy is to get wins on small issues," he said. "We have to get these things on the table. We must start getting aggressive."
Several major reforms desired by local officials — greater employee contributions to pensions and heath care and changes to collective bargaining — are known to be opposed by unions.
"Seeking to abolish basic labor protections or destroy the public pension system should not even enter the debate when we are discussing true mandate relief," Andrew Pallotta, executive vice president of New York State United Teachers, said at a state Senate hearing in February.
Pallotta called for reduced spending on charter schools and the spreading out of pension payments for schools.
Schools feel pinch
About two-thirds of local property taxes go to schools, which are desperate to break free from the state rulebook.
The seven districts that studied mandates found that during 2008-09, they spent $553,321 to administer tests, $526,813 to process data, $196,328 for health and safety inspections and monitoring, $147,060 for internal audits and $118,000 for other clerical costs.
Officials say many mandates, like mailing test reports, are outdated, while others, like measuring each student's Body Mass Index, are not education-related.
Edward Fuhrman, superintendent of Croton-Harmon schools, said the state's rules treat all districts the same, regardless of track record.
"We're all treated like failing districts," he said.
But the schools' main complaint is New York's web of special-education rules that go beyond federal requirements. Even the Council of New York Special Education Administrators wants changes to expensive rules for class size, how students are assessed, and public school requirements for students in private schools.
Naomi Brickel, director of the Hudson Valley Special Education Parent Center in Valhalla, said that mandates often do not improve services for their children.
"I feel our communities will continue to be supportive of our most vulnerable children," she said. "People will be even more supportive if they know how money is spent."
Ironically, as Cuomo pushes for mandate relief, the state is developing a new system of teacher evaluations that will cost districts time and money. "The road to higher taxes is paved with good intentions," Zevin said.
Mandates take bite out of budgets
Seven local school districts identified "unfunded mandates" in their 2008-09 budgets (not counting pension and health-care costs). Here are the results:
Mandates asDistrict Total budget Mandate costs % of budget
Croton-Harmon $39.6 million $6.4 million 16%
Carmel $102.5 million $17.8 million 17%
Garrison $8.4 million $1.4 million 17%
Brewster $78.7 million $19 million 24%
Haldane $18.6 million $3.8 million 20%
Hendrick Hudson $63.6 million $9.6 million 15%
Lakeland $130.2 million $36.2 million 28%
Total $442 million $94.5 million 21%

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