Education Matters: Revisiting money issues

This year’s $9.2 million deficit continues to loom large for the San Dieguito Union High School District, which is good reason to revisit the December 2015 teachers’ contract and the subsequent raises given to all other SDUHSD employees in 2016.

The union contract approved 3-2 by the school board will cost the district millions of dollars annually, and has fiscal ramifications for years to come since salary increases are not a one-time expense.

This massive $6.5 million annual expenditure is compounded by surging mandatory pension contributions which are expected to rise dramatically over the next few years.

Dwindling reserves complicates the matter further.

What were they thinking?

The numbers, provided in August 2016 by San Dieguito’s now Superintendent Eric Dill, are startling.

The teachers’ contract awarded a 7 percent increase retroactive to July 1, 2015 – and another 5.5 percent increase beginning July 1, 2016.

After the teachers’ labor contract was approved, the district, by more 3-2 votes, then awarded the same percentage raises to classified employees and management – in other words, everyone, including then Superintendent Rick Schmitt.

I asked Schmitt when this issue came up why he was taking this raise himself, when as superintendent he was charged with negotiating with the union on behalf of taxpayers.

In other words, who negotiates for the public when the district and the union are on the same side of the bargaining table?

“The school district negotiates for the taxpayer and the community, period,” he said. “That’s what we do. I/we represent the taxpayers in every negotiation we do, whatever the category.”

“We’re always looking to get the best value for the community at the right price,” he added.

Every salary increase in the teachers union contract is “by custom” awarded to every other employee in the district, Schmitt said, including those who negotiated the terms of the raise on behalf of taxpayers.

I heard two responses most often: “Everyone does this” and “It’s the way we’ve always done it.”

There is no clearer example of a conflict of interest than to have a superintendent negotiate on behalf of taxpayers and then take the same salary increase for himself, “by custom.”

Me-too clause

“Me-too” clauses rarely appear in superintendent contracts, and it did not in Schmitt’s.

But it’s typical standard operating procedure that superintendents, who are charged with leading negotiations with their unions on behalf of taxpayers, receive the same pay raises granted to teachers and other staff – whether the language is specified in the superintendent’s contract or not.

For example, the recent scandal at the San Diego County Office of Education concerned, among other issues, a clause in former Superintendent Randy Ward’s contract that stated: “The superintendent shall receive a salary increase each year equal to the increase rate given to SDCOE certificated teachers.”

This contract was signed June 11, 2014 by Ward and Sue Hartley, who at the time was president of the county board of education and this area’s District 5 representative.

Even though he received a big raise, Schmitt left the district June 30, 2016, to head the San Ramon Valley Unified School District in northern Calif. At the time, his SDUHSD salary was $238,329, which was set to go up to $248,347 on July 1. At San Ramon, where he started his employment on July 1, his contracted starting salary was $309,664.

Besides the superintendent, Schmitt’s four associate superintendents also received raises identical to the terms of the union contract.

Before the school board approved the raises for management in early 2016, the annual salary was $162,265 for all four associate superintendents: Eric Dill (Business Services), Mike Grove (Instructional Services), Torrie Norton (Human Resources), and Jason Viloria (Administrative Services).

After the approval, their salaries increased retroactively back to July 1, 2015 to $175,000. On January 1, 2016 the salaries increased again to $185,276, and then increased once again on July 1, 2016 to $195,466. All figures are according to Norton.

[Update: Dill is now SDUHSD superintendent, Viloria resigned last year to become supt. of the Laguna Beach Unified School District and was replaced by Mark Miller, and Norton has submitted her resignation effective June 30, 2017.]

The money

To recap, the total cost of the salary increases for 2015-2016 was $6,494,354, Dill said. Certificated (teachers) employees accounted for $4,096,522, classified was $1,952,920, and management and other employees cost $444,912.

For 2016-2017, the total cost of the salary increases is $6,542,402, Dill estimated. Certificated employees account for $4,848,296, classified is $1,286,655, and management and other employees cost $407,451.

This $6.5 million expense for salaries and benefits across the board will continue each subsequent year. (These figures, however, do not take into account the number of highly paid veteran employees who are retiring.)

No one would have objected to a reasonable contracted salary increase. But the size of the raise, coupled with applying the same raise to management, is what’s problematic.

As one reader wrote to me, “When taxpayers learn of the details of teacher contracts and compare them to their own job benefits and protections, they have no sympathy.”

Last June, at the 21st annual Golden Watchdog and Fleece Awards dinner, the San Diego County Taxpayers Association named SDUHSD as the winner of its infamous Grand Golden Fleece award, for the outrageous raises given to all employees.

This dubious distinction is not something you’ll see boasted about on the district’s website.

“To make matters worse,” the SDCTA said, “a month later the superintendent negotiated the exact same raise and terms for himself.”

Highest paid in county

Then there’s the language in the contract that San Dieguito teachers must be the highest paid in the county.

The SD County Taxpayers Assn. blasted the district, saying this guarantee is “irrespective of teacher performance, student success or the district’s financial stability.”

Bob Croft, president of the San Dieguito Faculty Association (teachers union), wrote in an email at the time, “In the view of the SDFA Executive Board, our educators more than deserve to be the best paid here in San Diego County!”

I asked Schmitt last year about this clause and the implications should other school districts also incorporate the same clause in their teacher contracts.

“You make a good point,” he said.

But he justified it anyway, saying, “There’s an expectation in our community that we’re Number 1 in academics, Number 1 in athletics, Number 1 in the arts. So Number 1 in everything.

“To me it doesn’t seem odd that our employees are the highest paid in the county. It is an expectation in our community that we’re the best at everything. I’ll stand behind that point.”

He also said the top pay is appropriate because the San Dieguito district “is the most expensive community in San Diego County to live” – overlooking the fact that most teachers commute and don’t live in the district.

At the time, I referred to the latest salary comparison charts produced by the San Diego County Office of Education for teachers from all 42 school districts county-wide.

Those documents showed that San Dieguito teachers with Masters degrees were ranked number 1 and 2 in the county – not ninth, 10th and 11th as Schmitt claimed.

Schmitt told me he was using charts produced by other sources to show that his teachers were not the highest paid. He said he would send those to me, but never did.

“I was looking at news items, updates from superintendent meetings, etc.,” he wrote in an email.

Schmitt said the district has a history of being fiscally conservative, and that there is money to pay for these raises well into the future, based on healthy reserves, conservative assumptions and realistically rosy projections.

Even if all that is true, which is suspect, did the raises need to be so high, at 12.5 percent?

Assuming scads of cash were just lying around, as Schmitt claimed, could at least some of it have been spent on hiring more teachers to reduce class sizes? More security? The arts? Relieving parents of the pressure to donate to foundations to fund classroom essentials?

Given the tragedy at Torrey Pines High School last week, how about additional counselors?

More background next time, and a look at the present financial condition of the district.

Opinion columnist and Senior Education Writer Marsha Sutton can be reached at suttonmarsha@gmail.com.

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