School Salary & Benefit Growth Driving Budget "Cuts"

New Jersey Left Behind:

NJEA President Barbara Keshishian has a news release out today slamming Gov. Christie's seizure of $475 million in local district surplus accounts. Add to that a possible 15% cut in state aid, she intones, and it's a "doomsday scenario for families" which will have "a devastating impact next fall, with many [districts] forced to lay off teachers and staff, cut academic programs or raise taxes."

Fair enough. Local school districts are frantically calculating draconian cuts to accommodate projected shortfalls. But here's the missing link in her jeremiad: those cuts are driven less by loss of surplus and state aid than by payroll and benefits increases radically out of sync with economic realities and private sector compensation. However, the solution's pretty simple: NJEA should direct its local affiliates to proffer a one-year freeze on salaries, and encourage small contributions to health benefits.

Here's an example. District A has a budget of $50 million. Typically 75% of those costs are payroll and benefits, or $37.5 million. If NJEA would exercise meaningful leadership and promote flat salaries for one year, those lay-offs, academic cuts, and tax raises would be almost entirely mitigated.

Posted by Jim Zellmer at March 4, 2010 1:02 AM
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