School Board analyzes post-retirement program
A program that pays retired Henrico school system employees a percentage of their final annual salaries in exchange for their part-time work within the system saves considerable money on substitute teacher expenses but could provide even more value to the system with several adjustments.
That was the conclusion of an in-depth analysis completed by county and school system finance officials, who presented their findings to the School Board Sept. 13.
At the beginning of the current fiscal year in July, the board increased the requirements of retirees who participate in the Post-Retirement Earnings Plan (PREP) program, mandating that they work at least 28 days during the school year in order to receive pay equal to 20 percent of their final annual paychecks. Eligible retirees may participate in the program for a maximum of seven years; 388 participate currently.
It was the third change made in the past three years by the board, which is seeking to squeeze more value from the 32-year-old program while reducing its annual cost. The PREP budget has dropped from its peak of $8.9 million in 2009 to $5.6 million during the current fiscal year. Prior to this year’s change, PREP participants received 22 percent of their final paycheck in exchange for working 24 days a year.
The program was created in 1980 as a way to provide a benefit to employees, encourage early retirement and save the school system money. During its budget process this spring, the School Board sought specific data to better determine the effectiveness and value of the program. But last week’s work session was proof that categorizing that value is a challenging exercise.
Though it’s relatively easy to determine the cost savings that results from using PREP retirees as substitute teachers – since there is a standard rate of pay for substitutes – it’s much more difficult to determine the value of administrative retirees who perform a variety of other responsibilities, Henrico Finance Director Gene Walter told the School Board.
Walter and his staff studied 507 PREP participants who entered the program during the past seven years and whose replacements were hired immediately upon their retirement. (The study didn’t include nearly 50 other participants whose former positions were eliminated, he said.)
Of those 507, 317 were retired teachers whose combined participation during those seven years saved the system $1.18 for each $1 it spent on the program, Walter said.
But Walter and his analysts could not determine a dollar-to-dollar estimate for the other 190 participants because their roles within the system were less defined and often entailed duties for which the system wouldn’t have hired temporary help.
School system officials recommended that the board consider a number of changes to the program that would make it easier to determine a clear value for each dollar spent in the program, including:
• assigning every participant to serve either as a substitute teacher (if qualified) or to fill another capacity with specific and direct calculable benefit to the system (such as SOL remediation);
• capping the maximum allowable salary to a participant at $90,000 annually;
• increasing the number of required years of Henrico service from 10 years to 15 years for eligible retirees and reducing the number of required years of service in the Virginia Retirement System from 16 to 15;
• requiring that interested participants notify the system of their intent by Dec. 1 annually and begin their participation the following July 1 (as opposed to the current system, which permits entry throughout the year – a minimum of 30 days after retirement – and makes budgeting for the program less predictable);
• grandfathering all current participants under the current standards until they have completed their seven years or dropped out of the program.
“We have determined that there’s a large responsibility on everyone’s part here to develop something that’s going to be very beneficial and cost-effective and also value-added to the school system,” Superintendent Pat Russo said during the work session. “That’s where we want to move this program.”
Current guidelines require that participants be at least 50 years old without having attained the age for full, unreduced Social Security benefits. The program initially was designed in part to serve as a bridge between retirement and Social Security, HCPS Finance Director Kevin Smith told the board. Using current standards, 854 current school system employees would be eligible to participate in the PREP program if they retired, HCPS Human Resources Executive Director Howard Banks said.
The board is expected to discuss the recommendations and the PREP program again at a meeting next month.
St. Joseph's Villa’s Flagler Housing & Homeless Services was one of three entities to earn the National Alliance to End Homelessness' Champion of Change Award. The awards were presented Nov. 17 during a ceremony at the Newseum in Washington, D.C.
NAEH annually recognizes proven programs and significant achievements in ending child and family homelessness.
Flagler completed its transition from an on-campus shelter to the community-based model of rapid rehousing in 2013, and it was one of the nation's first rapid re-housing service providers to be certified by NAEH. > Read more.
Richmond International Raceway's 13th annual Community Christmas tree lighting has been rescheduled from Dec. 6 to Monday, Dec. 12, at 6:30 p.m., due to inclement weather expected on the original date.
Entertainment Dec. 12 will be provided by the Laburnum Elementary School choir and the Henrico High School Mighty Marching Warriors band. Tree decorations crafted by students from Laburnum Elementary School and L. Douglas Wilder Middle School will be on display. Hot chocolate and cookies will be supplied by the Henrico High School football boosters. > Read more.
The Richmond Raceway Complex has two exciting, albeit very different, events taking place this weekend: the Richmond Antique Extravaganza Show and Sale and Discover the Dinosaurs Unleashed. If you’re searching for date night ideas, Wild Ponies will be performing at the Henrico Theatre tonight, CAT Theatre will present “Wishing Well” and The Modlin Center for the Arts at the University of Richmond will broadcast Bolshoi Ballet’s production of “The Sleeping Beauty.” For all our top picks this weekend, click here! > Read more.
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CalendarChildren in grades 2-5 are invited to Science Explorers – Grossology at Libbie Mill Library from 3:30 p.m. to 4:30 p.m. Make some snot, learn about germs and explore the things that make your body a totally gross place to live. Registration is required by calling 501-1940 or visiting http://www.henricolibrary.org. Full text