MONTGOMERY, AL - State Superintendent of Education Dr. Joe Morton outlined a plan to help K-12 education survive and to enable all education entities to be able to reduce the escalating cost of fringe benefits Friday. The move was made due to a second consecutive year of proration (mandated cuts in state education spending). Five recommendations were outlined in the State Superintendent's plan.
Morton first outlined for the members of the State Board of Education that all of education has $1.4 billion fewer dollars to spend in FY 2010 than in FY 2008. This is caused by the national and international recession and the fact that state tax collections of corporate and individual income taxes are sharply reduced along with a similar decline in the four-cent statewide sales tax, all of which are earmarked for education.
He then illustrated that in terms of students enrolled, K-12 education has 75.67% of all students, K-graduate school, yet receives 68.78% of state funding for education. Dr. Morton stated, "Local schools have made serious budget cuts and they cannot raise taxes without permission and support of the local board, the local government, and the Alabama Legislature, and often then an election is required, while both the two-year and four-year colleges can raise tuition with one vote of the governing board." He believes this leaves K-12 education at a disadvantage in school funding in financially good times as well as the hard times schools currently face.
His first recommendation is to encourage the Legislature to appropriate at least 70% of all available education dollars to K-12 for FY 2011 and to support a Constitutional Amendment to allocate future funding based on student enrollments in K-12, postsecondary, and higher education. If the Constitutional Amendment is adopted, K-12 education would receive approximately 75% of future education budgets based on the latest enrollment data available.
A second problem facing all of education, K-graduate programs, is the steady and even sometimes dramatic increases in the cost of employee health insurance and the retirement plan for all public educators. The insurance administrators have requested $282 million in additional state dollars to go with the current amount which will total in excess of $1 billion for FY 2011. The retirement administrators have requested $57 million in additional funds. "In a time when classrooms are hurting, when we do not have funding for reading, math, science, textbooks, or teacher supplies, we must draw the line on any new increases for fringe benefits," Morton stated to the State Board of Education.
His second recommendation is that the Governor and the Legislature must require the Public Education Employees' Health Insurance Plan Board of Directors to develop a plan to fund insurance at the FY 2010 level and with no increase in new state dollars. This could lead to employees paying more monthly for insurance since their premiums have not increased in 25 years, and it could also change benefits within the insurance plan.
Morton's third recommendation calls for the current law to be changed to make retirement contingent upon 30 years of experience and 55 years of age instead of the current law of 25 years of experience and no age minimum. This would be for all new employees beginning with the 2010-2011 school year. His fourth recommendation calls for changes to the Deferred Retirement Option Plan (DROP) of 30 years of experience and 57 years of age, up from the current law of 25 years of experience and 55 years of age, and his fifth recommendation is for all education employees to pay 6% of their salary to the Retirement Systems of Alabama as the employee contribution instead of the current 5%, which was adopted in 1975.
"I realize these are sweeping changes that likely will ruffle more than a few feathers on some really big birds, but we are in a survival mode in K-12 education and we need immediate as well as longer term help or we stand to lose the education of many students enrolled in our schools today," Morton said. "The last thing Alabama needs is one more high school dropout or one more undereducated high school graduate - there is very little future for either, and to do nothing in this time of crisis imperils the future of Alabama."