OPEB liability

Memphis City Schools retiree benefits up in the air following state attorney general’s opinion

PHOTO: Kayleigh Skinner
Retired educators attend a forum in Memphis last summer before the Shelby County Board of Education to discuss proposed cost-cutting changes to their retirement plans.

Retired employees of the former Memphis City Schools face uncertainty over which entity is eventually responsible for paying for their benefits after the state attorney general issued an opinion that the obligation is not owed by Shelby County.

Shelby County Schools, which was formed in a 2013 merger of the former city and county districts and is funded through the Shelby County Commission, has budgeted to pay for those benefits through the fiscal year ending June 30.

However, an opinion issued Tuesday by Tennessee Attorney General Herbert Slatery is expected to make the cash-strapped district reexamine its $1 billion liability in the matter.

Slatery said that, for Shelby County to assume the former city district’s indebtedness when school operations were transferred to Shelby County Schools, the Shelby County Commission would have to vote to assume the debt, which it didn’t.

And County Commissioner David Reaves doesn’t foresee such a vote happening based on the current structure of the liability.

Reaves hopes that the opinion, which he requested through state Sen. Brian Kelsey, will motivate the commission, Shelby County Schools and the city of Memphis to come to the table to develop a plan for managing the former city school system’s Other Post Employment Benefits, known as OPEB, which are retirement benefits such as health and life insurance but excluding pensions.

"People have been kicking this down the road for years, but hopefully this opinion will create an environment where we finally put this OPEB monster to bed."David Reaves, county commissioner

“People have been kicking this down the road for years, but hopefully this opinion will create an environment where we finally put this OPEB monster to bed,” Reaves said Wednesday. “It’s the perfect environment to fix this, but it’s going to take some tough decisions.”

New Memphis Mayor Jim Strickland immediately distanced the city from any obligation in the matter, however.

“It’s important to note that Memphis City Schools was a special school district, and was separate and apart from city government,” Strickland said in a statement. “The attorney general was not asked if city government is responsible for the special school district debt. The attorney general was asked if Shelby County government was responsible for the special school district debt.”

Reaves questioned that line of thinking, since city council had to approve the former city school district’s budget and since the district was cited in the city charter.

“These are the first salvos, and everybody is staking out their positions. But we need to call a spade a spade. Ultimately, we need to sit down to figure out how to resolve this,” he said.

Reaves said he hopes the matter does not end up in court, since Slatery’s opinion is not a binding judgment.

“Will it go to litigation? It’s highly possible, but I think that would be foolish. The wisest thing is for all parties to sit down and come up with a plan,” said Reaves, a former member of the Shelby County school board. “Out of the three parties, the city of Memphis is the only one who’s not kicked in any money for OPEB liability.”

Shelby County Schools has been weighed down by its $1.5 billion OPEB liability for city and county district retirees and has not been contributing enough to cover retirees’ real costs, prompting admonitions from county commissioners to address the issue.

Last summer, Superintendent Dorsey Hopson called OPEB “a huge gorilla around our neck” and presented options that ranged from cutting spouses from the district’s OPEB plan to providing incentives to purchase health insurance through the federal Affordable Care Act. However, as hundreds of retirees protested the proposals, district leaders backed off and opted for a comprehensive review of the issue.

Reaves said this week’s legal opinion should serve as a wake-up call to the school district, the county, the city and retirees that something is going to have to give.

David Reaves
David Reaves

“We’re all reasonable people and nobody is looking to put retirees at risk,” he said. “But we need to understand that the level of benefit we’ve been giving for a lot of years is probably going to have to change. It’s just not sustainable. We’re going to have to figure out how to fund a new OPEB level, and we need the city to be part of that discussion.”

Last summer, angry retirees contended that the district was seeking to save money on the backs of sick senior citizens by breaking a promise made to educators decades ago.

Reaves traces the problem to the former city school district.

“This is not the employees’ fault; this is about government mismanagement,” he said. “These promises given to employees were broken years ago when the previous school system didn’t budget for it. Now we have to come up with a different plan that everyone can swallow and, at the same time, keep us from going bankrupt. And we need the city to be part of that discussion.”

call out

Our readers had a lot to say in 2017. Make your voice heard in 2018.

PHOTO: Chris Hill/Whitney Achievement School
Teacher Carl Schneider walks children home in 2015 as part of the after-school walking program at Whitney Achievement Elementary School in Memphis. This photograph went viral and inspired a First Person reflection from Schneider in 2017.

Last year, some of our most popular pieces came from readers who told their stories in a series that we call First Person.

For instance, Carl Schneider wrote about the 2015 viral photograph that showed him walking his students home from school in a low-income neighborhood of Memphis. His perspective on what got lost in the shuffle continues to draw thousands of readers.

First Person is also a platform to influence policy. Recent high school graduate Anisah Karim described the pressure she felt to apply to 100 colleges in the quest for millions of dollars in scholarships. Because of her piece, the school board in Memphis is reviewing the so-called “million-dollar scholar” culture at some high schools.

Do you have a story to tell or a point to make? In 2018, we want to give an even greater voice to students, parents, teachers, administrators, advocates and others who are trying to improve public education in Tennessee. We’re looking for essays of 500 to 750 words grounded in personal experience.

Whether your piece is finished or you just have an idea to discuss, drop a line to Community Editor Caroline Bauman at cbauman@chalkbeat.org.

But first, check out these top First Person pieces from Tennesseans in 2017:

My high school told me to apply to 100 colleges — and I almost lost myself in the process

“A counselor never tried to determine what the absolute best school for me would be. I wasted a lot of time, money and resources trying to figure that out. And I almost lost myself in the process.” —Anisah Karim     

Why I’m not anxious about where my kids go to school — but do worry about the segregation that surrounds us

“In fact, it will be a good thing for my boys to learn alongside children who are different from them in many ways — that is one advantage they will have that I did not, attending parochial schools in a lily-white suburb.” —Mary Jo Cramb

I covered Tennessee’s ed beat for Chalkbeat. Here’s what I learned.

“Apathy is often cited as a major problem facing education. That’s not the case in Tennessee.” —Grace Tatter

I went viral for walking my students home from school in Memphis. Here’s what got lost in the shuffle.

“When #blacklivesmatter is a controversial statement; when our black male students have a one in three chance of facing jail time; when kids in Memphis raised in the bottom fifth of the socioeconomic bracket have a 2.6 percent chance of climbing to the top fifth — our walking students home does not fix that, either.” —Carl Schneider

I think traditional public schools are the backbone of democracy. My child attends a charter school. Let’s talk.

“It was a complicated choice to make. The dialogue around school choice in Nashville, though, doesn’t often include much nuance — or many voices of parents like me.” —Aidan Hoyal

I grew up near Charlottesville and got a misleading education about Civil War history. Students deserve better.

“In my classroom discussions, the impetus for the Civil War was resigned to a debate over the balance of power between federal and state governments. Slavery was taught as a footnote to the cause of the war.” —Laura Faith Kebede

Weekend Reads

Need classroom decor inspiration? These educators have got you covered.

This school year, students will spend about 1,000 hours in school —making their classrooms a huge part of their learning experience.

We’re recognizing educators who’ve poured on the pizazz to make students feel welcome. From a 9th-grade “forensics lab” decked out in caution tape to a classroom stage complete with lights to get first graders pumped about public speaking, these crafty teachers have gone above and beyond to create great spaces.

Got a classroom of your own to show off? Know someone that should be on this list? Let us know!

Jaclyn Flores, First Grade Dual Language, Rochester, New York
“Having a classroom that is bright, cheerful, organized and inviting allows my students to feel pride in their classroom as well as feel welcome. My students look forward to standing on the stage to share or sitting on special chairs to dive into their learning. This space is a safe place for my students and we take pride in what it has become.”

Jasmine, Pre-K, Las Vegas, Nevada
“My classroom environment helps my students because providing calming colors and a home-like space makes them feel more comfortable in the classroom and ready to learn as first-time students!”


Oneika Osborne, 10th Grade Reading, Miami Southridge Senior High School, Miami, Florida
“My classroom environment invites all of my students to constantly be in a state of celebration and self-empowerment at all points of the learning process. With inspirational quotes, culturally relevant images, and an explosion of color, my classroom sets the tone for the day every single day as soon as we walk in. It is one of optimism, power, and of course glitter.”

Kristen Poindexter, Kindergarten, Spring Mill Elementary School, Indianapolis, Indiana
“I try very hard to make my classroom a place where memorable experiences happen. I use songs, finger plays, movement, and interactive activities to help cement concepts in their minds. It makes my teacher heart so happy when past students walk by my classroom and start their sentence with, “Remember when we…?”. We recently transformed our classroom into a Mad Science Lab where we investigated more about our 5 Senses.”


Brittany, 9th Grade Biology, Dallas, Texas
“I love my classroom environment because I teach Biology, it’s easy to relate every topic back to Forensics and real-life investigations! Mystery always gets the students going!”


Ms. Heaton, First Grade, Westampton, New Jersey
“As an educator, it is my goal to create a classroom environment that is positive and welcoming for students. I wanted to create a learning environment where students feel comfortable and in return stimulates student learning. A classroom is a second home for students so I wanted to ensure that the space was bright, friendly, and organized for the students to be able to use each and every day.”

D’Essence Grant, 8th Grade ELA, KIPP Houston, Houston, Texas
“Intentionally decorating my classroom was my first act of showing my students I care about them. I pride myself on building relationships with my students and them knowing I care about them inside and outside of the classroom. Taking the time to make the classroom meaningful and creative as well building a safe place for our community helps establish an effective classroom setting.”


Jayme Wiertzema, Elementary Art, Worthington, Minnesota
“I’m looking forward to having a CLASSROOM this year. The past two years I have taught from a cart and this year my amazing school district allowed me to have a classroom in our school that is busting at the seams! I’m so excited to use my classroom environment to inspire creativity in my students, get to know them and learn from their amazing imaginations in art class!”


Melissa Vecchio, 4th Grade, Queens, New York
“Since so much of a student’s time is spent inside their classroom, the environment should be neat, organized, easy to move around in but most of all positive. I love to use a theme to reinforce great behavior. I always give the students a choice in helping to design bulletin boards and desk arrangements. When they are involved they take pride in the classroom, and enjoy being there.”