New Pact With Teachers Offers Lakeville Schools Potential Savings

Health care costs have been one of the largest factors contributing to the yearly parade of .

But with the by both the teachers union, and Lakeville's School Board, that's all about to change.

Increases in health care premiums for Lakeville's 647 teachers will be shared much more, and a totally new plan for retiree health care benefits could save the district boat-loads of money in future years.

"I would say it is fair and equitable for both sides of the aisle," Don Sinner, president of the teachers union, Education Minnesota Lakeville, told the Pioneer Press. "It realizes the financial situation of the district and values the membership that works here."

Over the past few years, the pie of money for teaching students in Lakeville hasn't grown much. But over that same time, the piece of the pie going to teachers' health care costs has been growing very quickly, leaving less for other things, resulting in massive cuts and adjustments over the years.

That's because the district had been paying for all annual health care premium increases up to 7.5 percent, then splitting the remainder of any increase 50-50 up to 20 percent, and even taking the full weight of any increases over 20 percent.

Under the new plan approved Tuesday, the district pays just the first 2.5 percent of annual health insurance premium increases and then shares the remaining increases 50-50 with teachers.

And that's not all. Retiree benefits are getting overhauled as well. And that's where the district could see huge savings according to Tony Massaros, the district's director of administrative services.

In past contracts, retiring teachers who were 55 years old and had worked in the district for 20 years received defined-benefit health care good until they became eligible for Medicare. With the potential for the Medicare eligibility age to increase, as well as the ever changing costs for the premium, Massaros said the result offered an unknown financial risk for the district.

The new plan offers newly hired teachers something of a "health care retirement account" and not a promised level of health insurance. Both teachers and the district will contribute to the account, and the district's contribution  is limited to $51,000 per individual. Teachers will be vested into the plan at the same levels of service as the previous one—55 years old with 20 years of service.

Beyond health care, the pact also calls for $600 pay raises for teachers, but a freeze in seniority-based step increases for the first year. In the second year, steps resume, with raises based on experience, and the top step receiving a raise of $1,900.

Language or the assignment of teachers to areas of study they may be qualified for, but have limited experience in, was also addressed in the contract.

The contract also addresses teachers' increasing workload and "," Sinner said. Over the past few years, Lakeville's teaching ranks have been reduced more than 15 percent.

Lakeville Patch will post a copy of the contract as soon as possible.