Professional Documents
Culture Documents
EMPLOYEE INDIRECT
COMPENSATION
Presentation Objectives
Deliver a Basic Understanding of:
2
18.0%
16.0%
14.0%
12.0%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Every $1.00
of salary
above
Like a pro market value
sports team
“luxury tax”,
therefore
salary costs actually
compound costs the
Two of the with MPSERS district $1.23
districts largest and FICA – a 23%
expenses are rates. premium on
calculated as a our largest
percentage of expense.
salaries:
Retirement at
16.94% and Meanwhile, MPSERS rates can
FICA at 6.5%. be expected to rise.
Financial Transparency Series - Employee Direct Compensation
Health and Other Insurance Basics
7
2007-8 2008-9
Cost Per All Cost Per Cost Per All Cost Per
Employees Contract Employees Contract
Medical Insurance $9,481 $11,677 $9,610 $11,842
All Other Insurance* $1,167 $1,235 $1,159 $1,212
Totals $10,648 $12,912 $10,769 $13,055
Insurance Costs Per Pupil $1,179 $1,237
Health Care costs alone consumed more than the state increase of the per
pupil Foundation Allowance from 2007-8 to 2008-9.
There will be NO Foundation Allowance increase from 2008-9 to 2009-10
and we project a $53 cost increase per pupil on health care.
* Other insurance includes Dental, Vision, Life, and Long-Term Disability
Financial Transparency Series – Employee Indirect Compensation
Indirect Compensation Per Employee
Increases with Salary, MPSERS Rate, and Inflation
9
Multiply the Net Compensation Cost increase per pupil by the total number of
students to quantify the full impact of the problem this poses.
Indirect Compensation
• Indirect Compensation per employee is up 6.7% from 2
Costs are Increasing years ago. (Teacher direct compensation up 6.5%.)
Faster Than Our • Revenue per pupil up only 1.1% in same time.
Revenue Per Pupil
Relative health care • GPPS has successfully kept our health care costs lower
cost control than districts using MESSA.
advantages have been • However, cost savings have fueled our position as
consumed by salaries paying the highest average teacher salary in the state.
Compounding Costs of • Since MPSERS and FICA costs are the product of their
rates and salaries, GPPS pays an additional premium.
MPSERS and FICA on • The unfunded liability of the state MPSERS fund will
High Salaries likely mean higher rates in the near term.