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School board not rethinking VRS
Despite suggestion from supervisors
Monday, July 2, 2012
By DEBBIE HALL - Bulletin Staff Writer
The Henry County School Board will not reconsider its decision to fully implement a mandated increase to the state pension fund, rather than phase it in.
“The decision still stands as it is,” school board Chairman Kathy Rogers said.
Last week, Jim Adams, chairman of the Henry County Board of Supervisors, suggested the school board reconsider its decision to fully implement a 5 percent increase in employee contributions to the Virginia Retirement System in this fiscal year, rather than phasing the increase in as allowed by law.
Employees affected by the mandate must receive an equal pay raise to offset the increased cost of their contribution.
The supervisors opted to phase in the increase at 1 percent per year for the next five years for an estimated savings of $218,000.
With the school system implementing the entire 5 percent contribution in fiscal 2013, it will cost $580,000 or $660,000 more than implementing it over five years, depending on whether school or county officials’ figures are used.
The VRS must receive decisions on the implementation by July 10, “and any consideration by the school board would have had to have taken place by July 1,” Adams said Friday.
The supervisors cannot control what the school board does, “but what I wanted to make sure was that we were effectively communicating the board of supervisors’ stance,” he said. “We wanted to make sure that we were effectively communicating the broader view” of implementing the full 5 percent, Adams said.
He noted that future salary increases will be compounded on top of the 5 percent increase. When that is factored in, the 5 percent “actually becomes a broader figure,” Adams said.
Darrell Jones, the county’s finance director, said it would be 25 years before the school division would realize any cost savings from paying the full 5 percent now.
Ridgeway District School Board member Francis Zehr said he voted against implementing the entire contribution because “I thought we would have saved $600,000 over the five years, and I wanted to take that money and reinstate the health and safety officers at Magna Vista and Bassett” high schools, as well as some other positions.
Zehr said the funds for those positions “run out on July 1.”
Curtis Millner, who represents the Iriswood District on the school board, also said the decision stands, and he has heard no indication that it will be revisited.
“I think that we made the best decision based on the information that we had, and we’re not the only school division” to implement the full amount in one year, Millner said.
Given the school division’s 1,200 to 1,400 employees, compared to the county’s 132 employees, and the school division’s turnover of 50 to 60 staff each year, Millner said, “we would have to have multiple additional step scales” (used to calculate employees’ pay), and that employees “would be treated differently than others” because of the disparity in salary.
“Personally, I think this is something we need to get behind us and move on and not have it hanging over us for a period of five years,” he said.
At-large member Joe DeVault said the school board “deliberated a long time on the direction we were going to take, and I think we felt we were doing what we needed to do.”
He also has not heard of any plans to reconsider the decision.
“I would certainly hope” that will not create tenuous relations between the school board and supervisors, DeVault said.
“I hope it’s not creating ill will, but I think when we constructed our original budget, we constructed it to account for this,” he said. “And we felt we needed to go in the direction we went with it.”