Last year, the teachers did not do this, and of course 57 teachers, administrators, and staffers ended up losing their jobs. So now that we know that the district is looking to close another $3.5 million deficit in the coming year and that the current plan is based on $2.5 million in cuts, 33 additional jobs cut including teachers, administrators, and eight support positions and there will be an additional $1 million realized in employee concessions that are still to be determined.
However, in a way, it is not fair to lump the teachers in with city budgets. We can argue about the wisdom of the teachers taking a pay raise several years ago, but each year that becomes less and less a factor. The bottom line is that the teachers are not overpaid at this school district. If anything, they are not paid nearly enough. They do not exemplary benefits, again, if anything they deserve better benefits. And at this point, the problems faced by the school district are not self-inflicted.
All of this is rather remarkable given where the district was back in 2006 when their finance director left in a cloud of scandal and uncertainty. The problems that the Davis School district face is because the state economy and state budget are in shambles. If the teachers took some short-term furloughs, they could weather this storm, but it would be very painful. However, I suspect the 50-plus teachers and staffers who lost their job last year would argue it is more painful to be out of work.
Education in California as we have mentioned many times is in trouble, but not through its own doing. We can argue on the margins about efficiency and waste, but cutting $15 billion from schools is going way beyond that. There is no doubt that the districts have been forced to become more efficient, but there is also very little doubt in addition to cutting pork we’ve cut bone and muscle. The people who are hurt the most in this are not just those teachers out of work, but the children who will have to make do with fewer classes and larger class sizes and who have lost a good generation of the young and energetic teachers and we might not get those back any time soon.
It is a different story for our city and I really wish the Enterprise had not put these stories together because despite the fact that both share the need to cut costs, there is no true parallel.
The Enterprise editorial writes:
“OVER AT DAVIS City Hall, the City Council was able to close its $3.4 million budget gap by assuming $1.25 million in savings from personnel givebacks. However, those concessions have not been realized yet, for the most part, because the employee unions and the city are still negotiating terms of new contracts.
Until those new contracts take effect, our city is paying its employees under the old wage-and-benefit structures. Day by day, we’re falling deeper into our gaping budget hole.”
It is actually worse than that. Each day we are not only falling deeper into our budget hole, but each day we will have to find additional money to cut from the budget because the employee concessions will occur over less and less of the fiscal year’s budget.
The City’s finance director has already announced they could fall $350,000 short of that $1.25 million and that will require $700,000 in cuts because they would be, if signed tomorrow, realized only over half the fiscal year.
The editorial continues:
“We don’t know precisely what’s been going on in the negotiations behind closed doors, but the council’s ‘guiding principles’ foresaw lower salaries for highly paid employees, reduced contributions from the taxpayers for lucrative pensions and modifications to the health packages given to employees and retirees.”
From what we know, it appears that the workers who make the most are those most protected in this process. The people who are going to bite the biggest bullet are those at the bottom end.
Will we see changes to the pensions and retiree health packages? Indications suggest we will not.
“As a show of good faith, employees represented by two unions – the Davis Management Employees and the Program, Administrative and Support Employees Association – agreed to take five furlough days to help the city achieve some savings during the ongoing labor negotiations. We applaud them for stepping up, but we wonder why their colleagues have remained so silent.”
We are less applauding than the Enterprise on this matter. Furlough days are not the answer here, they are the problem. Furloughs mean that the structure of the salaries remains. Furloughs mean that we have not addressed the issue of pensions or the unfunded liability of retiree health benefits.
The Enterprise concludes:
“Taxpayers need – indeed, we expect – our leaders to look out for our best interests.”
Instead what we saw this week was our leaders on the City side looking out for their own best interests and the best interests of special interest groups. A 3-2 council majority voted inexplicably to pay $400,000 in additional money to the fire department. While that money is on paper off-set by other cuts that were already planned for the fire department, it means that $400,000 will have to be cut from somewhere else.
The Enterprise writes:
“DURING GOOD TIMES, public employee unions found their requests for higher salaries and generous retirement benefits easily granted by elected officials they helped put in office. Actually, no one noticed just how much these increases cost the taxpayers because times were so good.”
This is a good statement, but it is too vague. They make reference to the fact that the increases were tremendous, they made reference to the fact that they helped put these elected officials in office. The Enterprise however has never laid out the whole causal chain of events, the tremendous amount in campaign contributions from one single union, the disproportionate amount of salary increases that union has received compared to counterparts, and now the large increase in spending for their department compared to others. Until the Enterprise reports on this, they are not telling the public the full story.
And while the Enterprise alluding to pensions and retiree health benefits, they never put numbers on those figures. The public needs the full and plain truth. And while the Enterprise can be applauded for raising the issue, calling for sacrifice and concessions, they are still not delivering the truth.
The truth is as Vanguard reads know, that the city faces a crisis of unfunded liability for retiree health benefits of between $42 and $65 million. The truth is that next year the city will be paying nearly $8 million in contributions to employee retirement funds, in 2000, that number was less than $1 million. And that number figures to go up due to the losses that CalPERS took last year. The result will be either a dramatic increase in employer contributions or another unfunded liability.
The fact is that while both the city and school employees need to make concessions, the need is different for both. The school is being hurt primarily due to external factors that are way beyond its control. The city is being hurt by policy decisions over the past decade that has seen employee salaries and benefits skyrocket to 71% of the city budget. And if we do not get a handle on this, we will share the fate of Vallejo. The first step starts with the city bargaining units and the city’s negotiators. All indications at this point show this will be a false-start and we will have to go back and fix this at a later date when the problem is far worse.
—David M. Greenwald reporting