Pennsylvania school board-union negotiations and the media
From Sunshine Review
Media coverage of board-union contract negotiations is constrained by at least three major factors:
- Inherent limits (tight deadlines, limited column space or short airtime slots)
- Resistance on the part of negotiators (school boards and unions alike) to disclosing any information while negotiations are in progress.
- The unfamiliarity of reporters with contract issues and terminology.
This section is mainly intended to help with the third of these problems. It provides a short overview of negotiation issues and the arguments and counter-arguments frequently made in public statements by both sides. This may help journalists explain contract negotiations to their audiences and enable them to question both board and union spokespersons more effectively.
[edit] Questions to help readers and viewers put contract negotiations into context
Answers to the questions may help in developing a fuller picture of negotiations issues for journalists' readers, listeners or viewers.
- Overall importance
- Q. At present, what percentage of the district’s budget pays for the contract with the bargaining unit? (Probable answer: between 45-55 %.)
- Q. How much of this amount is salary and how much is benefits? (Probable answer: On average, benefits are about 20% of salary. Individual ratios will vary with healthcare coverage chosen and the size of the base salary.)
- Q. Are any issues on the table that are not primarily financial? (Possible answers: merit pay, skill-based pay.)
- Understanding fiscal trends.
- Q. What do you (board and/or union) project as the total cost increase of your proposal, comparing the final contract year with the current base year?
- Q. If board and union estimates differ significantly, how do their assumptions differ. For example, has the board taken into account the likelihood that higher-paid teachers will retire?
- Tax impact.
- Q. What percentage of the district’s total revenue is raised from local sources? (Statewide average is around 60 %, but local answers may vary from 10 % to 90 %.)
- Q. What do you (board and/or union) project by way of tax increases to cover the costs of this contract? If answers differ significantly, why is this? (As a rule, the districts least likely to have to raise taxes to cover contract settlements are at the opposite ends of the economic spectrum. Affluent districts with growing economies may be able to cover increased cost out of growth in the value of their millage. The poorest districts already get most of their money from the state.)
- The public's right to know. (If either side resists discussing its proposal of record.)
- Q. To a board spokesperson: You publish proposed budgets for public comment and hold hearings on building purchases, providing information to justify any necessary tax increases. Why should this kind of expenditure be subject to different rules?
- Q. To a board spokesperson: The existing contract is already a matter of public record. Will the board be willing to post it online? And will be board post the existing distribution of teachers on the salary schedule (e.g., how many teachers are at each pay level)?
- Q. To a union spokesperson: “You will already have provided the board with an explanation of why you believe your proposed salary and benefit package is needed. Why not begin now to make your case to the public?”
[edit] Terminology
- Salary percentage increases. When either the board or the union refers to a salary percentage increase in percentage terms (e.g., “5%”), what is the exact meaning? It's likely that both sides mean a percentage by which total salary for the bargaining unit will increase in a given year. E.g., if salaries now total $20M and rise to $21M, that would be a 5% increase. However, the union answer may mean: “We want to see the value of each salary step rise by 5%. E.g., if the difference between Step X and Step X+1 is now $1,000, we want to see that increased to $1,050 next year, to $1103 in year 2, and to $1158 in year 3.”)
- Step movement. This refers to the number of steps (usually meaning “years”) required for teachers at the start of their careers to move to the top of the pay scale. “Step compaction” refers to reducing the number of such steps – i.e., to shortening that time. Conversely, “adding a step” extends the time period before reaching the top of the scale. A “step freeze” means leaving unchanged the number of steps on a scale but delaying a scheduled seniority-based pay raise (usually for one year).
- Fund balance. Districts are required to approve annual budgets that exactly balance expenses and revenues. If actual revenue exceeds the amount budgeted (or expenses fall below the amount budgeted), the extra money goes into a fund balance. (If revenues or lower than expected or expenses higher, the difference may be negative.) The term “fund balance” refers to the accumulation of these debits and credits over the entire period that the district has been in existence. It may or may not consist entirely of cash. For example, some portion of it is likely to be in the form of uncollected taxes.
- Retroactivity. Have the budget impacts of any retroactive pay increases been explained?
[edit] Claims and counter-claims
Spokespersons for both boards and unions may "spin" answers and data. The question is not so much whether these statements are flatly false, as whether they may be incomplete or misleading. What follows are some of the more common issues and phrases apt to be offered with spin.
- Affordability. If the board contends that a proposed contract is “unaffordable,” does this mean that the board projects that it will require a tax increase large enough to trigger a back-end referendum under Act 1 of 2006? Or does the board only mean, “This would require a tax increase larger than we believe is justified?” If a union contends that a proposed contract is “affordable,” does this mean that it believes that it can be paid for without a back-end referendum, cutting programs or cancelling plans for construction or renovation of physical facilities? Is either side suggesting that first-year contract costs be covered in large part from money now in an unrestricted fund balance? Or from savings due to retirement of higher-paid teachers?
- Compensation comparability (cross-district). It takes some care to be assured of a "apples-to-apples" comparison. For example, in comparisons to nearby districts, are the base years the same? Is the choice of districts based on anything besides geographical proximity? Has there been any pattern of movement (in or out) between the districts chosen? Has any analysis been done of actual turnover rates? Do the comparisons take into account relevant differences? (E.g., differences in “average” salaries may reflect differences in the relative age of the two faculties.)
- Compensation comparability (private sector). Any comparisons with private-sector employers are likely to be suggested by the board, possibly on healthcare cost-sharing. Are these based on recent data?
- “Working without a contract.” This wordage is routinely used by union spokespersons to describe working under the terms of a contract remaining in force beyond its intended expiration date. It is more accurate to say, "working under the old contract" or similar wordage. (If anyone insists that "without a contract" is accurate, ask whether any employee no longer receives full salary, healthcare coverage or protection of rights to file a breach-of-contract grievance.)
- Healthcare contractual issues. Rising healthcare costs, especially the costs of prescription drugs, create difficult contractual issues since, until a few years ago, most Pennsylvania teachers received free healthcare coverage, except for modest a co-payment and a low deductible. Union label proposals to change this "cost-shifting," and boards may call it "cost-sharing." Both terms mean the same thing, and the union term is less euphemistic. Proposed cost-shifting measures involve only changes in fixed-dollar costs through a higher co-payment and higher deductibles. However, they may involve increases in employees’ percentage share of total costs – e.g., “10% of premium.” Cost-shifting in percentage terms seem more likely to offset rising costs over time, mainly by creating a commonality of interest between boards and unions in identifying cost-control measures. For example, union members may be more willing to accept higher costs for brand-name medications if they know that everyone in the bargaining unit will save money if most employees shift to generics.
- Retroactivity. Probe to determine the effect of any retroactive agreement on the following year’s budget. Normally, this will apply only to salary since healthcare benefits will have continued under the terms of the previous contract. Because state law requires expenditures and revenues to balance every year, retroactive settlements, unless initially paid by spending down a fund balance, are more likely to trigger Act 1 referendum requirements than would be the case with normal year-by-year increases.
- “Hiding money.” A union may contend that a district’s assertion that a proposed contract is “unaffordable” is false because the district is “hiding money.” This charge may sometimes be accurate. If the district has moved large amounts of money from its unrestricted fund balance into other “restricted” funds, a reporter can ask whether the amount is reasonable, based on whatever planned use is mentioned. (For example, “technology replacement” is a less plausible explanation for a large “capital reserve” fund than specific plans for a new building that the board has often discussed in public meetings.) A district may also deliberately underestimate future revenues. However, some caution in forward estimates is simple prudence because many revenue sources, like state funding, involve political and other factors outside local control.
