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Franklin, Fulton counties offer retirement incentives to help with budget deficits

March 22, 2011|By JENNIFER FITCH | waynesboro@herald-mail.com

WAYNESBORO, Pa. — To close anticipated budget gaps for 2011-12, some school districts in Franklin and Fulton counties are turning to retirement incentives worth tens of thousands of dollars.

“We knew if we didn’t have the retirement incentive, we’d have to furlough people,” said Dwayne Northcraft, superintendent for Central Fulton School District.

Central Fulton in McConnellsburg, Pa., offered $40,000 to each of 12 people who signed retirement agreements, Northcraft said. The money was part of 403(b) retirement savings plans, he said.

Tuscarora School District in the Mercersburg, Pa., area offered $25,000 to teachers and $10,000 to support staff members who work six or more hours a day. They can choose as a group whether they prefer Health Reimbursement Accounts or 403(b)s.

Business Administrator Eric Holtzman said he expects about 12 teachers will submit retirements.

“Twenty-five thousand dollars is generous, but it is also a savings for the taxpayers if we do not backfill those positions or we fill it with someone making less money,” Holtzman said.

Northcraft said he researched retirement incentives and believes to truly save money with them, you must be willing to live with vacancies. Central Fulton restructured its curriculum to allow for nine vacancies, bringing the overall number of teachers to 72.

“We are working really, really hard to not cut from our kids,” he said, saying some curriculum changes, such as new Advanced Placement courses, add to the existing offerings.

Holtzman and Northcraft said their districts’ retirement incentives are comparable to what they’d expect to pay out for unemployment and legal fees for grievances if they tried to furlough teachers.

Holtzman said it could be difficult for teachers to find new jobs because of cutbacks across Pennsylvania.

“It makes it more compassionate at the end of the day,” Holtzman said of retirement incentives.

Waynesboro Area School District’s bargaining unit last week presented the school board with Tuscarora’s retirement incentive’s details for the board to consider. However, some school board members aren’t sold on the idea.

“It doesn’t really work for anyone. ... In the long term, it’ll cost you more than you’d ever gain for it,” said Leland Lemley, Waynesboro Area School Board member.

Waynesboro averages 10 to 15 retirements a year. Lemley said a retirement incentive could prompt people planning to retire in another year or two to submit retirements. Those savings wouldn’t be realized in their regular year.

“It cuts your throat in future years. ... It’s not something I could ever support,” he said.

Teaching positions such as those in higher-level math and science courses, English as a Second Language program and special education can’t typically be filled with first-year teachers who earn less, Lemley said.

“You don’t know who is going to retire,” he said. “You don’t know if it’s going to be a position you’ll have to fill.”

Greencastle-Antrim School District is not offering a retirement incentive, but school officials would be open to discussions about it, according to Robert Crider, director of educational operations.

Chambersburg Area School District is offering teachers who submit retirement notices by April 15 an opportunity to have their individual health care coverage extended through June 30, 2012.

In 2010, the district offered a financial incentive based on years of teaching, per diem and an additional $1,000 to $2,000 depending on the submission date of teachers’ notices.

Northcraft said Central Fulton’s school board is making its budget decisions in a time when it is seeing decreasing enrollment. He said the rural district had 1,200 students enrolled in the early 1990s, compared with 1,050 through 2007 and 975 since 2008.

“The student population decreased by roughly 235 students, but our staffing numbers actually increased,” Northcraft wrote in a statement about retirement incentives.

Central Fulton School Board is paring down a $900,000 deficit, Tuscarora a $1.5 million deficit and Waynesboro an approximate $2 million deficit.

Pennsylvania Gov. Tom Corbett has proposed reverting basic education funding for public schools to their 2008-09 levels, before federal stimulus dollars infused school district coffers.

Teachers in both Waynesboro and Chambersburg are working under contracts that expired on June 30, 2010.

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