A 1.5 percent pay raise equaling a combined $6,929 for Oxford Schools? four central administrators was approved 5-1 by the board of education last week.
‘This can happen and it does not cost the district any money,? explained Superintendent Virginia Brennan-Kyro, referring to a switch in health insurance plans expected to yield enough of a savings to completely offset the salary increase.
Brennan-Kyro’s annual salary will increase $1,960 from $130,694 to $132,654. Assistant Superintendent Nancy Kammer will receive an additional $1,723, raising her annual pay from $114,909 to $116,633.
Tim Loock, executive director of business/finance, will see his salary rise from $110,300 to $111,955, an increase of $1,655. James Schwarz, executive director of curriculum, will receive another $1,590 this year, raising his salary from $106,020 to $107,610.
In exchange for these pay hikes, Oxford’s top four administrators agreed to switch from their current MESSA (Michigan Educational Special Services Association) health plan, which is underwritten by Blue Cross Blue Shield of Michigan, to health savings accounts (HSA).
A health savings account is a tax advantaged savings plan ? a financial account with various restrictions ? available to taxpayers in the United States to cover current and future medical expenses. It allows money to be put in before tax is paid on it and then to withdraw the money tax free for qualified medical expenses.
‘The health care should be comparable (with an HSA),? according to Brennan-Kyro.
This switch is expected to save the district $14,906 annually for the four central administrators alone. Brennan-Kyro stressed that savings is just a ‘conceptual number? as the district is ‘still negotiating.?
‘It’s going to be somewhere right around there,? she said.
Because the switch won’t take effect until January, the district is expected to realize a savings of $7,453 (which equals half a year) for the 2006-07 school year.
‘There are tax laws that prohibit us from switching until January 1,? Brennan-Kyro said. ‘We were willing to do it now, but we’re being told we cannot until January.?
Even when the $6,929 pay raise for the four central administrators is taken into consideration, the district will still save a net $524 for the school year, Brennan-Kyro noted.
‘Is it a significant savings? No,? she explained. ‘The significant savings we’re talking about is in terms of the future.?
Brennan-Kyro said the district is looking toward someday moving all its employees to health savings accounts ? a move which ‘will save the district significant dollars in health care costs in the future.?
‘We’re trying to contain health care costs,? she said. ‘This is killing everybody right now because they just keep escalating.?
Having the four central administrators switch to HSAs sets an example and sends a message to the district’s employees about the new health plan.
‘We need to walk the talk,? Brennan-Kyro said. ‘If I’m asking my employees to change to this health insurance, I think I need to be on this health insurance too.?
‘I don’t think it sends the right message for us to say, ‘Okay, all of you go on this new health care, but I’m staying with MESSA and Blue Cross,?? she explained. ‘We need to demonstrate that if it’s good enough for them, it’s good enough for me and my central office.?
So far, the district’s 17 building and department administrators and eight support staffers in the central office have all agreed to switch to HSAs in January and in return received a 1.5 percent pay hike.
‘It’s a like a trade-off for being willing to switch over to the new insurance,? Brennan-Kyro said.
The superintendent and other three central administrators asked for and received the same compensation for agreeing to switch.
‘We’re willing to switch over,? she said. ‘We believe it’s important to switch over. But we’re asking for the same consideration.?
‘Really, a 1.5 percent salary increase, after taxes, it’s not even about the money,? Breannan-Kyro noted. ‘It’s about saying you support your administrators and your teachers, and saying you know the people are working hard.?
‘Every person that comes to work ? whether they’re you, me, a teacher, a custodian ? they work hard and they do a good job. And one of the ways you demonstrate that recognition to your employees is by giving them some kind of a monetary increase. People need that kind of recognition.?
‘Another rationale? behind the central administration’s 1.5 percent pay raise is to keep the four of them ‘competitive? salary-wise with the building administrators.
‘When you look at our administrative group ? which is like the building principals and supervisors ? they have some provisions in their contract that the four of us do not,? said Brennan-Kyro, referring to the ‘step system? and longevity, both of which give employees set pay increases after so many years of work.
Given the central administrators do not have a step system or longevity built into their contracts and took a pay freeze in recent years, the superintendent said 1.5 percent increase is a way of ‘making sure that we’re keeping up.?
‘It’s very difficult to have a situation where the employees are making more than the executive supervisors that are running the district,? she noted.