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Brown Deer School Board delays vote on OPEB transition plan

May 22, 2012

Brown Deer School Board members delayed a decision on a OPEB transition plan tonight at their board meeting.

Director of Finance Emily Koczela presented a recommendation from a committee that has been studying other post employment benefits for teachers in the district. The benefits disappeared with the union contracts at the end of June 2011.

For the short term, through the 2011-2012 school year, the School Board guaranteed the same benefits that were available through the contracts while working through what, if any, post employment benefits the district would offer in the future.

In addition to post employment benefits offered by the district , teachers also receive a pension from the Wisconsin Retirement System.

In the past the district continued health insurance coverage for up to 10 years and provided a cash payout of five days per year for every year of service, as long as the teachers met the age and requirements for years of employment in the district. The cash payout averaged $40,000 per teacher and was paid over five years for a group of 11 teachers who retired in June 2011, Koczela said.

Going forward, Koczela proposed that the district freeze all benefits effective June 30, 2011. For those employed in the district at that time who will eventually meet the age and service requirements, the committee recommended a maximum of seven years of health insurance and the cash payment that would be due to them under the old contract.

Member Barry Godshaw asked how much that plan would cost the district. Koczela said she calculated $4 million, but that actuaries would come up with a better, and less expensive, number. Her calculations did not account for people who will leave the district or for some other reason not meet the requirement for the benefits. Before Act 10, the OPEB liability was more than $7 million so even at the $4 million figure shows a significant reduction.

The transition plan must be submitted for an actuarial study before August when the auditors come to the district, but the board decided to discuss the plan at a workshop planned for next week before making a decision.

A second decision also looms ahead. The board at some point must decide what, if any retirement, benefits it will offer to newly hired teachers. Koczela said the committee has not reached any consensus on a recommendation for that group of employees.

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