Published: January 28, 2009 07:00 pm      

Retirement plan may cut education costs

TRAVERSE CITY -- A proposed retirement incentive geared toward eligible school employees across Michigan has the support of some local educators for its goals to cut costs and build a younger staff base.

The Michigan Education Association, the largest teachers union in the state, introduced the plan Wednesday at the state Capitol in Lansing. A small group of legislators from both parties was present, but no area lawmakers attended.

The proposal would allow teachers and other school staff who qualify for pension benefits to retire with larger monthly payments, making way for younger hires with lower salaries and health costs.

"Let's face it, as you move on in this business and get older and older, you look forward to retiring," said John Scrudato, president of the Traverse City Education Association, a local chapter of the MEA. "That's the future coming in."

The MEA said the plan would save public schools statewide more than $410 million next year and nearly $1.7 billion over 10 years. The proposal could be considered to help fill a projected budget hole in the state's school aid fund.

If enacted into law, it also could reduce the potential for layoffs, said Ed Sarpolus, MEA's director of government affairs. Employees would have a specific window in which to retire under the plan.

It would cost schools or the state some money in extra pension benefits. But those costs would be more than offset by reduced payrolls, the MEA said.

Estimated savings could be reduced if districts don't hire only beginning teachers, said Tom Stobie, superintendent of Frankfort-Elberta Area Schools.

About four years ago, his district offered $30,000 spanning three years to staff with 25 or more years of service. Five took the offer, Stobie said, and the teachers who replaced them weren't all recent college graduates.

"You tend to want to hire the best person (regardless of age)," he said, adding, "We did save money."

The proposal did not yet have a sponsor in the Legislature, MEA spokesman Doug Pratt said.

Gov. Jennifer Granholm's office learned of the proposal Wednesday and had not yet analyzed it, said Liz Boyd, the governor's spokeswoman.

"The governor is open to creative solutions that will save money," Boyd said. "But we have to ensure that whatever solutions we agree upon address both the short-term and the long-term economic challenges."

The Associated Press contributed to this report.