PhillyBurbs.com: The ABCs of your schools: Act 1 law making contract talks difficult
School boards "are using Act 1 to limit salary increases," a state teachers union spokesman said.
The state's property tax relief law, enacted four years ago, is playing an increasing role in contract negotiations between area teachers unions and their respective school boards, officials said.
The law, commonly known as Act 1, is a major reason why nine schools and districts in Bucks and Eastern Montgomery counties are approaching the new school year without labor agreements in place, they said.
Salaries and benefits are the main tie-ups in negotiations in the Centennial, Central Bucks, Hatboro-Horsham, Neshaminy, New Hope-Solebury, Pennridge and Pennsbury school districts, and Bucks County Technical and Upper Bucks Vocational high schools, officials said.
Act 1 limits how much school districts can raise taxes without residents' approval to help pay for the salaries and benefits. Tax percentage increases were about 4 percent when the law went into effect. Since then, the amount a district can raise taxes, known as the index rate, has been decreasing.
The index rate for 2011-12 is expected to be about 1.2 percent, said Dave Davare, director of research services for the Pennsylvania School Boards Association. It is not expected to go back up in the near future, he said.
That, coupled with the fragile economy and the increased contributions that districts will pay to the Public School Employees' Retirement System fund in the next few years, are the main reasons why school boards are calling for little or no salary increases in their contract proposals for teachers unions.
"Districts need to pay attention to what they are spending, not only in terms of the present year outlay but also future year expenses," Davare said.
Not everyone sees it that way. State teachers union leaders say the property tax relief law has become a tool of sorts for school boards.
"Boards are using Act 1 to try to limit salary increases and get local associations to pay more for their health insurance premiums," said Rob Broderick, a spokesman with the Pennsylvania State Education Association.
The state law does not prevent school boards from spending money on collective bargaining agreements, Broderick said. He suggests if school boards want to stay competitive with attracting and retaining quality teachers they "have to make choices" about program and extra-curricular offerings and capital improvements.
School boards also can file for more exceptions from the state to raise taxes above their districts' index rate to cover special education, pension payments and other costs. That would free up existing revenue to help cover salary increases for teachers union members, he said.
"The rate of settlements is coming down," Broderick acknowledged, because of the environment created by Act 1, the economy and the impending pension rate increases. Unions are weighing their options, he said.
"They have to decide what's better, whether it's a new contract or staying with what they have where they are not getting raises but they also are not paying more for health care," Broderick said.
Davare, the research services director at PSBA, a trade group, said he doesn't see the labor stalemates ending any time soon given the increasingly dire circumstances surrounding the contract talks.
School board members are hearing from their constituents across the state, many of them hit hard by the tough economic times, he said. They encourage board members to not give in to the union demands for greater salaries without significant increases to their health care contributions, he said.
"Negotiations are going to be difficult and protracted," Davare said.
August 22, 2010 03:31 AM
