Tracy Hobbs has worked in Lake Orion Community Schools for 30 years. The school psychologist said this was his first and last job out of grad school.
‘It’s been 30 wonderful years here,? he said. ‘I love what I do. I love coming to school every day.?
But now, Hobbs joins 46 other veteran employees in taking an early retirement incentive (ERI). Starting this summer, he’s a retiree.
Hobbs says his decision to retire was fueled by state legislation on the table that would penalize retirement-age workers for continuing to work, the call of his hobbies and activities, and, of course, the ERI.
‘It’s an opportunity to move on on my own terms,? he said. ‘In some ways it’s altruistic to take the buyout and save someone else’s job ? in terms of our school psychology staff, with some new staff coming in and worrying about the security of their jobs.?
The district’s administration offered the buyout ? $60,000, payable over five years ? to Lake Orion Education Association (LOEA) members in an effort to save money. Immediate savings comes by not replacing 20 staff, and long-term savings comes from a $55,000 difference in salaries between top-level and entry-level LOEA staff, according to school officials.
The district predicted 28 would take the buyout, saving approximately $1.36 million for 2010/2011, and $6 million over the next several years.
Instead, 47 took it, which should nearly double the savings, right?
Wrong.
‘It’s not intuitive,? said Margaret Hazlett, executive director of human resources. ‘Naturally, you would think the more people who go, the greater the savings must be. But the more people who go, the more the incentive costs us in the first year.?
The reality is, says Assistant Superintendent Jillynn Keppler, replacement fees and the buyout costs, along with sick-day payout and fees are nearly even with the $55,000 savings.
‘Any additional savings would come with not replacing beyond the 20 because the savings is in non-replacement,? said Hazlett.
Of the $1,367,040 saved by not replacing 20 teachers, $3,500 will be eaten up in costs associated with allowing 47 staff to take the buyout, leaving the district with a net savings of $1,363,584.
The district does have the option to defer early retirement and keep an employee, and it’s an option Boardmember Bob Gritzinger says he wants to take since 47 early retirees won’t offer more savings.
‘We need things that give us immediate benefit. If it’s not going to do that, then I’m not sure why we would do it and lose our experienced, Lake Orion-trained, know-the-school-district people,? he said.
Hazlett says defering some retirements is not currently the plan, but she added the district is still working on staff levels for next year, so exact numbers — and the potential for deferment — is yet to be determined.
Superintendent Ken Gutman notes that it’s unfortunate to lose so many quality people who have accomplished so many great things for the district.
‘We will certainly miss them, there’s no getting around that,? he said. ‘The staff that we have will have to step up and fill the void. When a superstar retires, you know that there are some quality people in the organization to fill the void.?