Teachers, board demonstrate leadership (03/22/04)

The hardest problems to face up to are those which aren’t yet on your doorstep.

Budget crises forecast for the “out years,” looming clouds of conflict, or environmental concerns that simply get put off until another day, all too often government responds to such issues in panic, patching together solutions that are inevitably more costly, more painful, and more disruptive than they would have been if matters had been addressed on a timely basis.

It takes real leadership to take on long-term difficulties before they become short-term train wrecks.

And real leadership is what the Jay School Corporation and the Jay Classroom Teachers Association have demonstrated this year.

Faced with an enormous headache down the road — an unfunded retirement liability estimated by actuaries to be about $36 million — the school corporation pressed the issue in negotiations with the teachers’ union.

Showing both vision and courage, the teachers responded by making significant sacrifices in order to assure the fiscal health of the school system over the long haul.

At issue was, as one school board member put it, a blank check that couldn’t be paid.

Over the years, contract agreements between the school system and the teachers’ union created a couple of additional retirement benefits beyond the state teachers’ pension fund.

One was the ability of teachers to accumulate up to 220 unused sick days; at retirement, those sick days could be cashed in like a lump sum retirement payment.

The other was retiree health insurance coverage.

Actuaries, those folks who deal with mortality tables and interest rate projections for a living, will tell you that benefits like the accumulated sick day plan and retiree health insurance are nearly impossible to predict accurately in terms of their total expense.

There are simply too many variables involved. But it’s safe to say the costs are enormous, and no plan was in place to pick up the tab.

Fortunately — or unfortunately — the Jay School Corporation isn’t the only one to have fallen into this particular difficulty. The Indiana General Assembly responded by creating a pension bonding system, which will provide money for a lump sum buyout of the promised benefits. The bonds will be paid off with funds that would otherwise have gone toward capital projects, which guarantees some belt-tightening down the road for the school system, but won’t result in a property tax increase.

It’s a truly complicated issue, and we suspect there are plenty of school boards and teachers’ unions around the state that aren’t facing up to it.

But Jay County and its teachers did. Leadership, vision, and courage made the difference.

Now if only the General Assembly could muster up some leadership of its own to address the unfunded liability in the teachers’ retirement system. — J.R.[[In-content Ad]]