Philly: More dubious budget reporting from NYTimes

The NY Times finally decided to jump in with its take on the controversial story of Philadelphia’s school reform commission cancelling the teachers’ contract. Not  surprisingly, in a story largely sympathetic to teachers (pointing out, for instance, that they make less in salary than neighboring suburban teachers) the Times ignores most of the relevant fiscal facts, most especially the extraordinary cost of employing teachers in Philly thanks to a range of expensive and outdated perks that are at the heart disputes between the union and the reform commission. Instead the story makes a passing reference to rising pension costs and pins the rest of the blame on cuts to state aid.

The district’s own guide to its budget, however, supplies the grim details. You’d want to look into that if you were a reporter covering schools because compensation makes up 80 percent of school budgets in America, so budget squeezes are almost ALWAYS about salary and benefits (Last year, according to the Census’ survey of public school finances, school systems in American spent $523 billion, $419 billion of which was salaries and benefits).

There’s plenty that is shocking in the Philly school budget, but this chart below is a good indication of the mess. It lays out costs for a typical teacher. Take a look at the bottom line, average cost. The average salary of an elementary school teacher is $68,600. But benefits add an incredible $44,100 in additional compensation. That’s additional costs amounting to 64.3 percent of salaries. That is NOT the norm in the workplace in general, or even in public schools in particular. According to the Census survey, nationally the average benefit costs for teachers equals nearly 40 percent of salaries.

Indeed, as the chart below makes clear, if Philly’s benefits costs were just somewhere in the neighborhood of other school districts, it would be spending about $60 million less on elementary school teachers alone. And teachers are only part of the spending problem. See pages 22-24 of the report I link above for a full list of average salaries and benefit costs for every job classification in the school system, from principals to counselors and librarians (average salary for a school librarian: $72,000. Additional cost for benefits: $45,800).

http://www.publicsectorinc.org/wp-content/uploads/2014/06/philly.png

It takes quite a bit of work to spend so much money on benefits, and Philly schools have been working at it for a long time. The Times story makes a passing reference to rising pension costs, though not a bit about what they amount to. They’re nearly $15,000 per year but, more importantly, these costs are rising rapidly (up about $3,000 in the last year alone) and likely to keeping growing thanks to the failure of the Pennsylvania legislature to enact meaningful pension reform. Philly teachers also receive Social Security (about a third of state and local government workers don’t), so the total contribution by the Philly schools system to retirement costs is actually 29 percent of salary.

The Times story does note that teachers pay nothing for health care, but doesn’t say what that costs the system. The total comes to nearly $14,000 per worker for medical insurance, and an additional $4,447 under health and welfare, which are added benefits like vision and dental care. The rest of the benefits are listed in the chart below, including the cost of setting aside termination pay (for unused accrued leave) that teachers can claim when they leave, equal to $2,246 per year for the average teacher, and the cost of legal representation for teachers (a perk negotiated through collective bargaining) equal to $165 per teacher per year.

In short you could learn more from scrolling through these few charts about the real mess in Philly than the Times tells you in 1,100 words. Maybe, like this previous Times story on Los Angeles, where it was clear the reporter wasn’t budget savvy, this reporter didn’t know her way around a simple guide to the budget. But this is the Times national education reporter!

philly benefits

Comment (1) Add yours ↓
  1. Tough Love

    No surprise. and it’s ALL Public Sector jobs, not just teachers.

    The financial “mugging” of the Taxpayers by the insatiably greedy Unions/Workers and enabled by our self-serving, vote-selling, contribution-soliciting elected officials, must end now …… by a hard freeze to ALL of these pensions & benefits … ZERO future growth.

    October 19, 2014 Reply

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