Georgia school systems are taking another big financial hit — a 200 percent jump in health care costs for bus drivers, cafeteria workers and other traditionally low-paid school employees.
The increases are being phased in over four years. But next year alone, the tab for metro school districts will exceed $30 million, including $5.6 million for Cobb and $11 million for Gwinnett.
Local school systems are now being required to shoulder much more of the cost of health insurance for these non-teachers. In better economic times — as recently as 2008 — the state was chipping in as much as $279 million a year to help schools with their health care costs. But that pool of money has been siphoned for other state priorities and went dry this year.
This is on top of the double whammy districts are taking from declining property taxes and cuts in state education funding.
Cobb is looking to cut 250 teaching jobs next year, some attributed to these increased employer costs, said Mike Addison, the school system’s chief financial officer.
“A significant number of teacher jobs could be saved if we didn’t have to address that,” Addison said.
In some school districts, particularly rural ones, officials aren’t certain how they’ll come up with the money to cover the increases.
“It’s another punch in the gut to public education,” said Joseph Barrow Jr., superintendent of Ware County Schools in Waycross.
About 91,000 current and retired school custodians, bus drivers, cafeteria workers and teachers aides have insurance through the state Department of Community Health. DCH is increasing school systems costs, in part, because the agency was having to dip into its reserves to cover employee claims, officials said.
The state also is raising what local school systems pay toward each employees’ insurance costs from 23 percent closer to the norm of 75 percent, they said. Those per-employee costs go from $296 to $446 a month starting July 1, to $596 a month in July 2013 and to $746 a month in July 2014.
That’s on top of a $50-a-month increase per employee that hit school systems last fall. All of the rate increases are required to keep the state’s self-insurance program solvent and help avoid a potential deficit of more than $800 million by 2014, according to legislators and the program’s administrator, the state Department of Community Health.
But that’s tough for school systems, many of which already are furloughing staff, increasing class sizes and even closing their doors a few extra days during the school year to save money.
Relief isn’t coming anytime soon from the state. Stephanie Mayfield, a spokeswoman for Gov. Nathan Deal, said it’s unlikely that the scheduled cost increases will get rolled back. The state simply can’t afford it, she said.
“Unfortunately, the burden has grown too great, and in tough times we have to look to best practices and make tough decisions,” Mayfield said.
“Fortunately,” she added, “the employees will still have full coverage.”
In Gwinnett County, property values have been sliding about 7 percent a year, for a loss to the school system of $97 million since fiscal 2010, said Rick Cost, the school system chief financial officer.
This year, Gwinnett cut 650 teaching positions to balance its budget. Officials haven’t formulated next year’s budget yet, but Cost said the health insurance hit will be an additional $11 million and that the school system has few options to deal with it. Furloughs, pay freezes and job cuts could be on the table, he said.
That $11 million is a small percentage of Gwinnett’s $1.2 billion budget, Cost said, “but it is still a very large number.”
School systems can’t avoid the ballooning costs. Health insurance is an essential part of the package for employees such as Fannie Rolland, who drives a bus for Cobb.
Her husband, who is retired, doesn’t have access to another group insurance plan, so she depends on her coverage through Cobb County Schools for the both of them.
“He has high blood pressure, and I have high blood pressure,” said Rolland, who is an area representative for the Cobb County Association of Educators. “So we have to have health insurance.”
The small school system in Pickens County, north of Atlanta, was able to absorb the $86,000 that this year’s increase in the employer share cost, said school Superintendent Ben Desper. But he’s uncertain what the system will do when the bill goes to $542,000 this summer and to $1.6 million two years later.
“The $542,000 that we must ‘find’ to cover this price increase is the No. 1 budget concern in our system,” Desper said. “There is not $542,000 to spare in this system. There is just not much else to cut without hurting children.”
By 2014, the monthly per-employee cost for the school system — $746 — will be more than the $600 monthly take-home pay of the typical lunchroom worker in Pickens, he said.
Barrow said tight times have already forced his system to furlough all employees six days for three years in a row. The system also has increased class sizes, cut out support positions such as graduation coaches and delayed textbook purchases, among other things, he said.
“We will have to make cuts in other programs, people and/or raise millage rates to cover this kind of increased costs,” Barrow said.
Raising property taxes is tough in a system that ranks 163 out of 180 in the state in wealth, he said.
Alison Bartlett, a school board member in Cobb, said state officials boast that they’ve maintained revenue levels for schools. Yet at the same time, she said, they’ve been raising costs. The net result: School systems have had to cut teachers. In Cobb, the number of students hasn’t dropped to keep pace.
“Cobb is bare bones,” Bartlett said. “So any impact to our general fund is an impact to our class size.”
While the rising health care prices don’t directly affect teachers, they pay for a service that does, said Lisa Morgan, a kindergarten teacher in DeKalb County’s Midway Elementary School. Noncertified staff, meaning bus drivers, kitchen workers, custodians and others without a teaching certificate, are crucial, she said.
Morgan, who is the second vice president of the Organization of DeKalb Educators, a teachers advocacy group, said most of her students come from low-income families. The bus is the only way they’ll get to school, and most come with empty stomachs. The workers in the cafeteria ensure that they’re fed and ready to learn.
If schools couldn’t afford insurance, these employees might disappear, she said. “I cannot teach my children effectively if I do not have the other noncertified staff here as support,” she said. She is frustrated that she and other teachers have seen no cost-of-living increases in years and must deal with pay cuts as their health care contributions rise. At the same time, she sees the challenge faced by local administrators.
“How can I say I’m concerned that I’m not going to get my step increase when I know that cafeteria workers, custodians and bus drivers need their health insurance?”
About the Author
