School board discusses possible one-time employee payments

With increases to employee benefits approved last month and a 1 percent midpoint salary increase likely to follow, the Allen ISD Board of Trustees is still deciding whether or not to offer employees a one-time payment for the 2012-2013 school year.

At Monday's budget workshop, Chief Human Resources Officer Kent Turner recommended the board include language in this year's salary book that would allow the board to make the decision after the start of school, which is the deadline for this year's compensation plan.

Superintendent Ken Helvey further recommended the board delay the decision until October, explaining it would give the district time to receive the tax rolls for the year and get a better feel for where similar districts are going with regard to compensation plans.

"We're not necessarily recommending that we do [the one-time payments]," he said. "We may decide in the fall we don't want to do this."

Turner presented two examples of a one-time, lump-sum payment, paid for by the district's fund balance and given to all part-time and full-time district employees in both teaching and non-teaching positions.

A $500 payment would cost $1.24 million, while a $750 payment would cost $1.86 million.

A graph presented by Assistant Superintendent of Finance Mark Tarpley showed that while the payments would see the fund balance drop this year, the balance would still increase every year at the same rate as if the payments were not made, albeit from a lower baseline. An example of a permanent, 2 percent raise was shown to progressively reduce the fund balance, dropping below $40 million by the 2015-2016 school year.

Reactions to the proposal varied among board members. Trustee Jason Shepard expressed concern about using the fund balance for the payment given the current unpredictability of the school finance system. He also said he had reservations about telling staff members there is a possibility of a future raise without being certain it will come to fruition.

Conversely, Trustee Lois Lindsey, who earlier in the meeting requested the board explore the option of offering employees more than a 1 percent raise, pointed out the amount of money that would still be available in the fund balance, even with the salary increase and one-time payment factored in, would amount to $40 to $45 million -- tens of millions of dollars more than the board's recommended minimum fund balance of 20 percent.

"This board tends to operate many years down the road, where they can't possibly foresee what's happening," she said. "It's just kind of disturbing to me when what we ought to be doing is looking at what our teachers are doing, what our community has told us and the here and now. I don't want to go to the bottom black line, but there's a huge amount of space we can think about."

While Turner said other Texas districts are considering the one-time payment, spokespersons from Plano and Frisco ISDs said the districts are not seriously considering the idea. Plano ISD's board approved a 3 percent midpoint raise for employees Tuesday, while Frisco ISD is similarly considering a 3 percent increase.

Speaking to the Allen American Tuesday, Turner said the comparatively low raise is bolstered by the $40 increase of the district's contribution to each employee's health plan, which he said combined puts the average teacher's additional pay at around 2 percent.

"I feel pretty good about the total package that we're recommending," he said.

Turner also said budgeting for the one-time payment rather than using the fund balance would be impossible if the district wants to hire more teachers to bolster class sizes, which last year exceeded the state's 22-to-1 teacher-to-student ratio cap.

"Certainly, we went through some difficult times last year, and they stuck by us," he said. "The expectation is still high, and if we have an opportunity to reward those people, why not do that?"

The last time an AISD school board approved a one-time payment was in 1997, Turner said.

The district's compensation package is set for board approval on May 21.

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