1331 Franklin, SE • PO Box 117 • Grand Rapids, MI 49501-0117
(616) 819-2000 • (TDD) 819-2004 • FAX (616) 819-3480 • www.grpublicschools.org
March 12, 2013
Dear GREA Staff:
First and foremost, thank you for all you do. We know how hard you work on behalf of students and are very sensitive to the financial challenges that all our District employees have accepted, particularly in the last few years with new state laws and mandates requiring all public employees to pay more for retirement and health care. These new obligations, coupled with the district’s overall financial realities related to the significant decline in student enrollment (1,230 in the last 3 years alone), deep cuts in state funding (more than $470/pupil), and the most recent federal sequestration (TBD), have created a very challenging situation for us all.
We recognize that our salary schedule causes some of our teachers to be the lowest paid in Kent County as indicated by the Cambridge report. We want to do better district wide. Providing fair compensation throughout the district, within our financial resources, is a top priority for the Board and Superintendent. With that said, given our tenuous financial situation and the uncertainties around the future of our enrollment, state and federal funding, including the unknown impact of the charter school/cyber school expansion, we must also be prudent in how, when and to what degree we implement solutions.
With all that is going on, it is important to us that you have accurate and complete information about the Board’s latest proposal dated 3/04/13 as well as the district’s financial situation. We are disappointed at recent attempts to unfairly mischaracterize the Superintendent, the administration and the nine members of the Grand Rapids Board of Education as if they do not care about our teachers. This saddens us because we do care about you and your well-being. We want you to hear from us about our last proposal, the recent agreement with the GREA to “fix” the employee plus child issue, and to provide factual and accurate information about the district’s finances.
With the Board’s proposal, our teacher salary schedule will no longer cause some of our teachers to be the lowest paid in Kent County. This is part of an overall, long term strategy underlying the Transformation Plan around talent recruitment and retention. Thanks to the direction of the Board, not only have we enhanced the financial offering, we have also extended the length of the contract in our recent proposal.
Our last proposal dated 3/04/13, which has been rejected by the GREA, included:
– A three year contract ending 6/30/15 – A newly structured pay schedule with all GREA members receiving between a 2% to 4.3% raise effective April 1, 2013 based on where individuals are at on the salary schedule (see attached). This would also move some of our GREA members up from the lowest paid in the county about 4 to 5 spots and begin the process of making GRPS more competitive to retain and recruit talent.
– The new pay scale offers the following increases: o The new Step 1 increase ranges from 3.82% to 4.31% over the prior schedule o The new Steps 2-5 increase by 3% over the prior schedule o Steps 6-12 increase by 2% over the prior schedule
– Off schedule $100 merit stipend for individuals rated effective or highly effective in 2012-13, 2013-14, and 2014-15. This merit pay is required by state law. – Lane changes are provided in 2012-13 at the point of contract ratification and execution and lane changes are also provided for 2013-14 and 2014-15. – No steps are provided in 2012-13 or 2013-14. An opportunity to re-negotiate salary and insurance in July 2014 (when the economics of the contract expire). – Any salary or compensation increase in 2014-15 would be tied to agreed-upon conditions. – District would cover all dental, vision, life, and AD&D costs from the point of ratification of the contract and in 2013-14. Currently you are paying 11% of these costs. – Maintains the current hard cap limitations on health insurance premiums. – Extends the agency shop clause per the GREA’s request for the duration of the contract.
PA 152 – “TWO PERSON” HEALTH PREMIUM:
As you may know, PA 152 of 2011 does not specify how to treat an employee plus child. However, the Michigan Department of Treasury issued guidelines stating an employee + child should be considered under the two person/employee+spouse category. This is also an insurance industry standard, including in the MESSA policy – something that our bargaining team first shared with the GREA team on July 26, 2012.
I am pleased to report that the Board and the Superintendent offered an agreement to the GREA that would treat an employee + child as a family instead of as an individual and spouse – saving the 52 GREA members who fall into this category nearly $2,000. This agreement was signed on March 8, 2013.
I want you all to know that this was a local decision that we made based on the best interest of our employees after months seeking answers from the state. While Senator Hildenbrand has provided a letter of “legislative intent” that supports our local decision, we are still waiting for an official ruling from the state on whether this interpretation is in compliance with the new state law. The result of not complying with this law could result in a 10% loss of state aid. Therefore, the GREA has agreed to our request that, if there is an official ruling that these individuals must pay at individual and spouse level, we will have to comply and the employees will have to reimburse the District for the difference in cost. We appreciate the GREA’s cooperation on this important issue.
The GREA president stated at the February 18th Board meeting during public comment that the district only spent 39% of total revenue on instruction in 2011-2012. However, this by no means provides a complete and accurate portrayal of the district’s finances or our dedication to our instructional staff.
– Not all of the District’s revenue can be spent on instruction due to state and federal funding restrictions – including all revenue thus distorts the real picture
o 20.14% of the funds come from grants which are restricted for the purpose set forth in the grant with only a portion eligible to be used on instruction o 0.22% of the funds are restricted for athletic programming o 12.98% of the funds are restricted for instruction, pupil support and other costs associated with serving center programs throughout Kent County o 4.37% are restricted to pay for food service, GRASP, Houseman Field, etc. o 4.26% is restricted to cover debt and o 0.72% is restricted for capital projects
– In 2011-12, the district spent 65.31% of our unrestricted revenue on direct instruction, pupil support, and building principal/secretaries. Notably, we also spend more on instruction than Rockford, Byron Center, Lowell, Kent City and several other school districts in Kent County (2011 Michigan Department of Education Bulletin 1014).
Furthermore, the GREA president claimed that the district’s revenue has actually increased. Again, this claim paints a misleading picture.
– Over the last ten years, the district’s unrestricted revenue has decreased by $20 million, from $175 million in 2001-2002 to $155 million in 2011-2012. – Some restricted revenue sources have increased but these are limited examples tied to: one- time federal stimulus, 2004 voter approved bond, 2011 voter approved sinking fund millage, and the national school lunch/breakfast funding. – Since 2009-10, GRPS endured a one-time cut in our state foundation allowance of $154/pupil plus a permanent cut of $470/pupil
It is our hope that this information helps to clarify and correct information about the district’s true financial position. As part of the state’s transparency reporting requirement, financial information is available on our website. We are widely recognized as one of the most well run, fiscally sound urban public school districts in the state based on consistent clean audits and recently improved bond ratings. We should all be proud of this accomplishment.
In closing, please know that we are fully committed to working with all of our bargaining representatives and employee groups to address the financial hardships that exist, reinvest in our talent, and restore pride and respect in the public education profession. During the past twelve months, we have created a lot of positive energy and momentum and we are confident that we are headed in the right direction.
As always, thank you again for all you do.
Dr. Wendy V. Falb
Teresa Weatherall Neal, M.Ed.
Grand Rapids Board of Education