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Could Bigger PERS Payments Mean Fewer Teachers in Lane Co.?

Tuesday, January 22, 2013

Recently a highly placed official with Eugene 4J Public Schools spoke off the record with a member of Lane Solutions’ editorial staff. He revealed to us the cold, hard facts about the coming mandated increase in Public Employees’ Retirement System (PERS) payments and their effects on Eugene students.

During the coming biennium, mandated PERS payments by Eugene 4J will increase by 6.55%, or about $4,900,000 per year. By State law this, plus current PERS payments, must be made first. In other words, before 4J hires one more teacher, buys one new textbook, or makes one new computer available to our children, it must pay this additional amount into employee retirement.

So, what will this increase cost our children? Plenty. According to this official, a teacher costs 4J about $95,000 per year. Each one percent increase in PERS payments costs about $750,000 per year. So every one percent increase in PERS payments means that our children lose almost eight teachers!

The cost of a 6.55% PERS increase? The possible loss of nearly 52 teachers! The result – more kids per class and less education.

Should the PERS increase be covered by teacher layoffs, who will lose his or her job? Thanks to union rules seniority trumps teaching ability, performance and results. So the last hired become the first fired. This means that less expensive teachers are the first to go. A first year teacher costs about $32,000 less than a teacher with 20 years seniority, or about $63,000 per year. If all the layoffs come from this group, 4J will have to lay off 78 teachers!

In previous issues of Lane Solutions readers have learned how PERS rules and disputes concerning them are both made and adjudicated by the very State officials who profit from their own decisions, thus stacking the deck against taxpayers.

One result of this stacked deck is that PERS retirees are compensated for Oregon income taxes they must pay on their PERS income – even if they live elsewhere and therefore don’t pay Oregon income taxes. That’s right – a PERS retiree living in Delaware gets money from Oregon taxpayers for the Oregon income taxes he or she doesn’t pay!

The 4J official who revealed for our readers the true cost of PERS increases concluded the interview with some even more disturbing news: The increase in health insurance premiums is even larger than the PERS increase, and so may result in even more teacher layoffs. But more about that in a future issue of Lane Solutions.

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One response to “Could Bigger PERS Payments Mean Fewer Teachers in Lane Co.?”

  1. Fred Enright says:

    So, are you telling me that all the previous pers and health insurance increases have eliminated teacher positions? And as far as in/out-of-state pers retirees, they earned their retirement serving Oregon. Would you make this same “stacked deck” observation for U.S. Government workers and our retired military?

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