Pending Pensions

To battle the deficit, the MPUSD board approved plans to cut back from eight periods to seven in high schools next year.

Over the last few years, MPUSD has made some costly investments, like funding early childhood development classes. But it’s an age-old recurring investment that is putting on the pressure: pensions.

Pension payments are getting trickier for public entities all across California thanks to pension reforms approved in 2012, which shift the burden of employer contributions from the state to local level. Like other entities, MPUSD’s share of payments to the California Public Employees Retirement System and Teachers Retirement System (CalPERS and CalSTRS) is increasing.

“Costs are ballooning,” Superintendent PK Diffenbaugh says. “[MPUSD] is trying to be proactive about decreasing deficit spending.”

That means looking closely at every expenditure. Currently, MPUSD’s second-biggest expenditure is employee benefits, about 25 percent of the total budget. That includes an estimated $1.8 million to CalPERS and $4.8 million to CalSTRs in 2016-17. In three years, those payments will increase to $3.3 million and $7.7 million, respectively.

The board is taking action. At a meeting Nov. 28, they voted 6-0 to approve a plan incentivizing early retirement. It would let retiring teachers receive 75 percent of their salary, paid out as an annuity over a period of time.

The plan is contingent on at least 45 employees opting in, and could save the district $2.5 million over five years.

“It’s a way for teachers to identify if they can afford to retire,” board member Debra Gramespacher says. She also sees it as a way to stave off major layoffs in the future.

Marielle Argueza is a staff writer and calendar editor for the Weekly. She covers education, immigration and culture. Additionally, she covers the areas of Marina and South County. She occasionally writes about food and runs the internship program.

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