An amount of $2 million in health care cost concessions in the Board of Education and Hillsborough Education Association’s tentative contract makes privatizations unnecessary if voters approve the 2011-12 school year budget.
The tentative agreement, which the board unanimously accepted during Monday night’s meeting, followed a bargaining session that lasted most of Sunday, Negotiations Chairman Neil Hudes said.
“A variety of circumstances, including the economic climate and regulatory mandates, made for a very different type of negotiation,” Hudes said. “No one ever gets everything they want in a negotiation. It’s a give and take from the outset that hopefully meets both parties’ needs. ... Although privatization is not an item the board can or should negotiate, it certainly was discussed during these negotiations, with both sides having a common goal for each settlement.”
“I think it was a very successful process in which both sides worked collaboratively to reach a mutually beneficial agreement,” he added. “I think the union gave significant concessions at a time where it was needed.”
“We’re thrilled that it’s behind us,” HEA President Barbara Parker said. “We’re happy that privatization is behind us. That was a tremendous amount of pressure of saving the jobs of 270 people as well as maintaining the quality of our staff.”
The tentative contract conditions, which the HEA accepted as well, shifts the contract start date from June 30 to April 1 and requires HEA members to contribute 1.5 percent of their salaries to health care costs during that period. The conditions also change the district from a private insurance plan with Horizon Blue Cross/Blue Shield to the state’s health benefits plan, which also is with Horizon Blue Cross/Blue Shield.
Under the public plan, members on the direct service plan would see insurance co-pays ranging from $10 to $15 and would need to pay prescription costs up front and submit the requests for reimbursement. The plan also makes mail-order prescription requests subject to a co-pay rather than being free, Parker said.
The private plan included a $10 co-pay for office visits for members on the point-of-service plan, while members who qualified for the traditional service plan paid more to remain on that plan, Parker said. Members also paid a co-pay for filled prescriptions rather than the cost of the medicines, she added.
According to the new, two-and-a-half-year agreement, HEA members would pay for 12 percent of health care premiums during the 2011-12 school year, while receiving an average 1.5 salary increase. In the 2012-2013 school year, HEA members would contribute to 18 percent of health care premium costs while receiving a 2 percent average salary increase.
The contributions toward health care premiums allowed the district to balance its tentative budget, which will be put to a vote next week.
“This is basically what balanced out the savings that made privatization not necessary,” District Superintendent Jorden Schiff said.
“It really helped insulate the board against future rising costs of health care,” HEA First Vice President Daynon Blevins said.
The 12 and 18 percent contribution toward health care premium costs amounts to several thousand dollars more than contributing 1.5 percent of HEA members’ salaries, Parker added.
“This was where we knew we could give back the most in concessions,” she said. “The concession of going into the state insurance plan saved about $2 million for the board.”
Starting the contract on April 1 rather than July 1, the day after the current contract expires, also saved $250,000, she said.
A New Jersey Education Association salary expert will need to approve the tentative contract and provide a salary guide for the district before the board and HEA can approve a final contract. The salary guide would need to be accepted by both bodies before a final contract vote occurs.
While the district avoided privatization in the budget place on the election ballot, voters must still accept it. If it is voted down, the Township Committee will approve a reduction amount and suggested reduction areas. The district is only bound to the reduction amount, however, since it can choose the areas it will reduce.
“We will then meet with the Township Committee and talk with them about our budget process,” Schiff said. “I’m going to meet with them to present the budget to them so the members have a working knowledge of the process prior to the election. The Board of Education is going to have to look at all cost drivers to make a determination as to what it is going to make the most important.”
“That is going to be a big problem because we made all these concessions with the hope of saving all these jobs,” Parker said. “We do want them [the board] to look at other ways [to balance the budget]. We’re hoping that if the budget goes down, they will look at other opportunities to save money.”