Monday, March 9, 2015

LAUSD'S FAILURE TO ADEQUATELY FUND LIFETIME HEALTH BENEFITS- COULD NO NEWS JUST BE BAD REPORTING?




(Mensaje se repite en EspaƱol)
When it comes to the Los Angeles Unified School District's (LAUSD) failure to adequately fund lifetime health benefits, they have nobody to blame but themselves. Although it seems clear from today's article in the Los Angeles Times that LAUSD leadership is going to try and have teachers carry the financial weight on this failure to adequately fund these benefits in a timely mannner.
The fact that LAUSD has a lifetime healthcare obligation deficit to its retired employees of over "$11 billion in future costs" is not something that just happened yesterday, so why does it only wind up on the front page of The Los Angeles Times on March 8, 2015?"


2006 Retiree Health Actuarial info.pdf. Now that the chickens are coming home to roost, LAUSD administration says it is "planning to bring lifetime [health] benefits to the bargaining table." What it fails to mention is in the late 1990s, not only did LAUSD do nothing to address this pending health benefits disaster, they actually made it worse by promising United Teachers Los Angeles (UTLA) in earlier contract nogotiations that- in lieu of a pay raise- the last offered- that the District would guarantee the continued funding of teachers' healthcare benefits at then current levels both during their teaching careers and after their retirement, if they worked long enough to vest in lifetime benefit. It seem now as LAUSD gets ready to renege on a promise it made, while systematically failing to implement the steps necessary to keep the health plan solvent, that its earlier negotiation with UTLA represented LAUSD teachers was clearly in bad faith.
But this latest failure at LAUSD brings up more fundamental failures in the way LAUSD conducts business:
1. Board members failed to set aside money to pay for those increasingly expensive benefits, because they are merely part-time $45,000 a year employees who exclusively rely on an entrenched and self-serving bureaucracy that keep the pro forma rubber stamp decision making of the LAUSD Board members in the dark as to the ramifications of most all their actions- or in this case, their failure to act.
2. 93% of teachers brought up on charges during the last 9 years and forced into early retirement or locked in protracted and expensive litigation to defend themselves are over 40 and at the top of the salary scale. And a significant number of these teachers targeted on false charges were very close to vesting in these expensive lifetime health benefits. Does anybody think that's just a coincidence? In what business are the most seasoned employees most likely to commit malpractice? None.
Given these disproportionate numbers of teachers at the top of the salary scale or about to vest in lifetime health benefits, one wonders why the Los Angeles Times or any state or federal agency has yet to look into whether the actions LAUSD has taken against literally thousands of teachers have any merit. The fact that none of these charges have been verified under penalty of perjury as required by all relevant California Education Codes one would think should have been a red flag, especially now when such clear financial self-interest of LAUSD gives them a clear motive for such egregious actions against high seniority teachers.
3. Now LAUSD talks about placing money to fund these retirement healthcare benefits in an irrevocable trust. So why wasn't it done before and why are there no consequences for failure to do so? If there is an malpractice here it is surely in the actions of district administrators who continued to fund healthcare benefits deficits for years without addressing and dealing with the underlying problem definitively.
4. It is worth noting that the compensation and benefits package of administrators is not the same as that of teachers. Now it is noted in the Times article that "fewer legal protections than pensions" exist for these healthcare benefits.
5. It is worth noting that the solvency of any healthcare plan has to do with having adequate numbers of younger people who tend to use this benefit less than older members. With the growth of more private and charter schools, these numbers of younger teachers have been significantly impacted making the cost of health benefits more expensive across the board for public school districts like LAUSD that tend to have an older population of teachers.

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Leonard Isenberg
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"If a nation expects to be ignorant and free, in a state of civilization, it expects what never was and never will be."
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