Retirees fret as Shelby County Schools eyes retirement benefits

PHOTO: Daarel Burnette II
From left: Daisy Cleaves, president of Shelby County's Retired Teachers Association, discusses retirement benefits with teachers union president Keith Williams and retiree LaVerne Dickerson.

When Daisy Cleaves became a special education teacher in Memphis almost 50 years ago, she knew the $500-a-month job wouldn’t make her wealthy but she expected a steady income and, one day, a comfortable retirement through her pension and benefits.

Now 70, retired and president of Shelby County’s Retired Teachers Association, she finds herself on the verge of a fight in behalf of 8,000 retiree members who depend on financially strapped Shelby County Schools in their retirement.

Next Tuesday, Superintendent Dorsey Hopson is expected to present proposed changes in the district’s retirement plan at an estimated savings of $9 million. The proposal would increase the amount retirees under age 65 contribute to their health care insurance from the current 34 percent to almost half. He also wants to drop all retirees’ spouses from the district’s self-insured plan.

“They’re trying to balance their budget on the backs of the people who can least afford it,” Cleaves said this week, noting that some retirees live at or below the poverty level and suffer from chronic diseases such as diabetes, Alzheimer’s or cancer.

The district is responding to pressure from the state and Shelby County government to pay down its liability for Other Post-Employment Benefits (OPEB), which are retirement benefits such as health care and life insurance but excluding pensions. Last year, the district’s OPEB liability rose to $1.4 billion — close to the amount the district spends on K-12 education in an entire school year.

By not paying down the liability, the beleaguered district could face bankruptcy, according to Mike Swift, director of administration and finance for Shelby County government.

Hopson has said the district has no choice but to revise its retirement benefits and has suggested that those who are impacted should sign up for the federal Affordable Care Act, which was signed into law in 2010 and expands Medicaid coverage to millions of low-income Americans.

“Someone made a decision 40 to 50 years ago to offer more benefits to employees,” Hopson said during a recent radio program. “At the end of the day, we’re feeling the effect of those decisions because nobody put the money aside for those benefits.”

Formed in an historic 2013 merger of two large school districts in Memphis and Shelby County, Shelby County Schools is beset with financial and academic challenges. During the last two years, Hopson and the district’s Board of Education have worked to get the school system’s house in order under the weight of dwindling student enrollment, expensive academic intervention programs and decreasing property tax revenue. Last month, the board voted to cut $125 million from next school year’s budget by laying off more than 350 employees, closing schools and pulling $25 million from its savings account.

The merger consolidated two districts that were self-insured and for decades had pledged to maintain employees benefits in retirement. Medicare would pick up a portion of those costs once retirees turned 65.

In the last decade, however, health care costs have outstripped inflation while the area’s population has aged. The former districts, meanwhile, failed to keep up with the cost of health care and allowed their actuarial costs to balloon. For example, the former Memphis City Schools paid just $12 million toward its $1.1 billion liability, while the former Shelby County Schools paid $3.8 million toward its liability estimated at $342 million. Last year, the merged district paid $12 million toward its $1.4 billion liability.

A 2014 state law requires local governments to pay 100 percent of their actuarial pension plan costs in the next six years. It stipulates that a district cannot change its pension plan but can revise health care benefits, according to county officials.

Swift wants the district to pay the “actuarial” costs of its health insurance program — estimated at between $30 million and $40 million annually — to have enough money accumulated to fund all benefits.

School administrators don’t know how much the district will have to pay this year toward its OPEB fund because health care costs and the number of retiring employees fluctuates annually.

During a budget hearing last week before the Shelby County Commission, during which school administrators asked for an extra $15 million in funding, several commissioners prodded Hopson to make larger OPEB payments.

“It’s important to us that they evaluate their priorities and deal with the issue,” Swift said.

Elected school leaders have urged administrators to explore how to make cuts. “We can’t ignore it,” said board member Chris Caldwell. “The big question mark is how much [do you fund it]? You have to balance at this juncture the needs of the children and the long-term consequences of not addressing it.”

Since the merger, several tweaks ordered by district leaders have caused the costs of insurance premiums and prescriptions to increase and teachers and retirees to gripe.

Earlier this year, the district changed its health insurance provider from Blue Cross Blue Shield of Tennessee to Cigna, at a cost savings of $3.8 million. Blue Cross Blue Shield recently filed a lawsuit over the bidding process.

Last month, David Pickler, a former school board member and the financial adviser for the Tennessee School Boards Association’s trust account for employee retirement benefits, resigned amid complaints that he didn’t properly invest the district’s contributions worth about $36 million, exposing the district to market swings.

Such issues are rarely discussed or shared with leaders of the county’s largest teachers union, even though they directly impact members, said Keith Williams, president of the Memphis Shelby County Education Association. “They’re doing this to the retirees because they don’t have to look them in the face every day,” said Williams, who suggests that district cuts come from the salaries of central office staff instead of from the pockets of retirees.

Proposed benefits changes that are expected this month from Hopson would be far more sweeping and permanent than previous tweaks. Among the items he’s suggested are the elimination of retirement health insurance for employees hired this year after July 1, and increasing premiums for retirees who smoke.

For her part, Cleaves has spoken with a lawyer but fears her 749-member organization, which charges annual dues of $10, won’t be able to afford a legal challenge. She plans to comb through the union’s past contracts to look for promises made.

“It’s not our fault that the district didn’t put enough money aside for the future,” Cleaves said.

Contact Daarel Burnette II at [email protected] or (901) 260-3705.

Follow us on Twitter: @Daarel, @chalkbeattn.

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defensor escolar

Memphis parent advocacy group trains first Spanish-speaking cohort

PHOTO: Caroline Bauman
Manuela Martinez (center left) and Lidia Sauceda (center right) are among 19 parents in the first Spanish-speaking class of Memphis Lift’s Public Advocate Fellowship.

Manuela Martinez doesn’t want Spanish-speaking families to get lost in the fast-changing education landscape in Memphis as the city’s Hispanic population continues to grow.

The mother of two students is among 19 parents in the first Spanish-speaking class of Memphis Lift’s Public Advocate Fellowship, a program that trains parents on local education issues.

“We want to be more informed,” said Martinez, whose children attend Shelby County Schools. “I didn’t know I had much of voice or could change things at my child’s school. But I’m learning a lot about schools in Memphis, and how I can be a bigger part.”

More than 200 Memphians have gone through the 10-week fellowship program since the parent advocacy group launched two years ago. The vast majority have been African-Americans.

The first Spanish-speaking cohort is completing a five-week program this month and marks a concerted effort to bridge racial barriers, said Sarah Carpenter, the organization’s executive director.

“Our mission is to make the powerless parent powerful …,” she said.

The city’s mostly black public schools have experienced a steady growth in Hispanic students since 1992 when only 286 attended the former Memphis City Schools. In 2015, the consolidated Shelby County Schools had 13,816 Hispanic children and teens, or 12.3 percent of the student population.

Lidia Sauceda came to Memphis from Mexico as a child; now she has two children who attend Shelby County Schools. Through Memphis Lift, she is learning about how to navigate Tennessee’s largest district in behalf of her family.

PHOTO: Caroline Bauman
Hispanic parents attend a training with the Memphis Lift fellowship program.

“Latinos are afraid of talking, of standing up,” Sauceda said. “They’re so afraid they’re not going to be heard because of their legal status. But I will recommend this (fellowship) to parents. How do we want our kids to have a better education if we can’t dedicate time?”

The training includes lessons on local school options, how to speak publicly at a school board meeting, and how to advocate for your children if you believe they are being treated unfairly.

The first fellowship was led by Ian Buchanan, former director of community partnership for the state-run Achievement School District. Now the program is taught in-house, and the Spanish-speaking class is being led this month by Carmelita Hernandez, an alumna.

“No matter what language we speak, we want a high-quality education for our kids just like any other parent,” Hernandez said. “A good education leads to better opportunities.”

Stopping summer slide

On National Summer Learning Day, Memphis takes stock of programs for kids

PHOTO: Helen Carefoot
Torrence Echols, a rising first-grader in Memphis, builds a tower with giant legos at the Benjamin L. Hooks Library on National Summer Learning Day.

When it comes to summer learning, it’s been a better year for Memphis, where a range of new programs have helped to stem learning loss that hits hard in communities with a high number of low-income students.

On Thursday, Mayor Jim Strickland celebrated that work in conjunction with National Summer Learning Day and against the backdrop of the children’s reading room of the city’s main library.

He estimated that 10,000 children and teens are being reached this summer through learning programs spearheaded through Shelby County Schools, Literacy Mid-South, Memphis Public Libraries, churches and nonprofit organizations across the community.

That’s a record-breaking number, Strickland says, in a city with a lot of students struggling to meet state and local reading targets.

Summer learning loss, also known as summer slide, is the tendency for students to lose some of the knowledge and skills they gained during the school year. It’s a large contributor to the achievement gap, since children from low-income families usually don’t get the same summer enrichment opportunities as their more affluent peers. Compounded year after year, the gap widens to the point that, by fifth grade, many students can be up to three years behind in math and reading.

But this summer for the first time, Shelby County Schools offered summer learning academies across the city for students most in need of intervention. And Memphis also received a slice of an $8.5 million state grant to provide summer literacy camps at nine Memphis schools through Tennessee’s Read to be Ready initiative.

Literacy Mid-South used Thursday’s event to encourage Memphians to “drop everything and read!”

The nonprofit, which is providing resources this summer through about 15 organizations in Greater Memphis, is challenging students to log 1,400 minutes of summertime reading, an amount that research shows can mitigate learning loss and even increase test scores.

Reading is a problem for many students in Memphis and across Tennessee. Less than a third of third-graders in Shelby County Schools read on grade level, and the district is working to boost that rate to 90 percent by 2025 under its Destination 2025 plan.

The city of Memphis, which does not fund local schools, has made Memphis Public Libraries the focal point of its education work. This summer, the library is offering programs on everything from STEM and robotics to art and test prep.

Parents are a critical component, helping their kids to take advantage of books, programs and services that counter the doldrums of summer learning.

Soon after the mayor left the Benjamin L. Hooks Library on Thursday, Tammy Echols arrived with her son, Torrence, a rising first-grader at Levi Elementary School. Echols said they visit regularly to read books and do computer and math games.

“We always do a lot of reading and we’re working on learning sight words,” Echols said as she watched her son build a tower out of giant Lego blocks. “Torrence is a learning child and it’s easy to forget what you just learned if you’re not constantly reinforcing.”

You can find summer learning resources for families from the National Summer Learning Association.