Law to cost schools $3.8 million
Nevada’s 17 school district superintendents say the legislative decision to make them take care of their own retirees will cost school districts $3.8 million this fiscal year.
Jim Hager, head of the Washoe School District, told the Interim Finance Committee on Tuesday the cost of complying with that law “was neither budgeted nor accounted for in local school district budgets.”
He asked lawmakers to approve contingency fund money to cover the cost.
“Meeting the obligation of the measure without additional funding would force districts to take precious resources from programs already approved in local budgets and redirect them to the purposes outlined” in the new law.
Lawmakers voted last session to require school districts and other local governmental entities to offer their own retirees the same health benefit policies they give to their active workers. The practice of not providing health benefits for retirees saved those local entities a lot of money, which many of them put into better benefits for active workers.
But retirees complain the practice of “dumping” them on the state program upon retirement is forcing those retirees to pay as much as $1,900 a month to cover themselves and their spouses.
The law also orders local governments and school districts to pool active and retired workers so that the retirees don’t pay a huge amount more than those still working for their benefits and required those local entities to give their retirees now with the state plan a chance to return to the local plan.
Hager didn’t object to the goals of the plan but told lawmakers school districts – especially smaller rural districts – don’t have the money.
He said state contingency funding “will help alleviate the immediate pressure on local school districts to meet the mandates of this legislation.”
The Interim Finance Committee took no action on the request, instead saying they would schedule the issue for discussion at the next meeting.