Escambia Education Association Union of Escambia ESP

1. Escambia Education AssociationUnion of Escambia ESP ECSD Public Hearing Insurance Issues September 19, 2011

2. Why we are here: • Projections show a funding deficit to the trust. • Plan had a bad year. • Committee charged with finding a solution. • District said NO MORE FUNDS AVAILABLE. • Consequently, the committee was forced to design a plan that places the increases squarely on the backs of the employees.

3. That Plan: • Proposed placing 87% of the burden on employees. • 4.66 million in increased premiums • 7.66 million in plan changes. • A total of a 12.32 million dollar hit • 8% was placed on the District. • 1.1 million toward the reserves. • Retirees have a 5% increase. • Employees rejected the proposal 94% to 6%.

4. What Imposing This Plan Will Mean to Employees

5. HSA “Free” Plan • Employees must pay 100% of expenses until $3,000 deductible is met. • Then they pay 20% of all costs up to a total of $6,000. • There are no: • Physician visit co-pays • Urgent Care co-pays • Emergency room co-pays • Prescription co-pays

6. HSA’s Possible Impact on Employees *according to Florida Department of Education 2010-2011 year

7. Base HRA Plan’s Premiums Impact on Employees *according to Florida Department of Education 2010-2011 year

8. Base HRA’s Impact on Employees *according to Florida Department of Education 2010-2011 year

9. HRA 500 Impact on employees *according to Florida Department of Education 2010-2011 year

10. National Average • According to Consumer Expenditure Survey conducted by the US Government – the average cost for a family of 2.5 people for health insurance is $2,374.90. This represents 4.8% of the annual expenditures*. * See attached calculations

11. Possible Solutions • Increase District’s portion of the premiums. • Leave the Plan as is and redirect the $1,000 employer contribution to stabilize the fund. • Implement HSA as the free plan and place premiums on the HRA equivalent to 2009-2010 levels.

12. Problem With These Solutions • We have no way of knowing how much any changes made at this meeting will actually cost the plan. • We can’t fix this problem tonight.

13. Reasonable Solution • EEA Contract – Article I.1 • C. Issues may be raised through the appropriate collaborative process for consideration during the life of this Agreement. • F. This Agreement shall constitute commitments between both parties and may be altered, changed, added to, deleted from, or modified only through the voluntary, mutual consent of the parties in a written and signed amendment to this Agreement. • Escambia ESP Contract – Article I.2 • Issues may be raised through the appropriate process for consideration at any time during the life of the Agreement.

14. Therefore: • Reconvene the committee. • Direct the District to commit funds to the plan in a effort to seek a more reasonable solution for your employees. • Using a 70%-30% split, the committee would have access to 10 million dollars if the District pledged 7 million dollars and the employees absorbed 3 million in premiums and plan changes.

15. Can the District Afford More?ECSD Supplemental Budget Information – September 15, 2011

16. General Fund Instructional Expenses – Over Budgeting Source: 2009, 2010, 2011 Comprehensive Annual Financial Report

17. General Fund Over-budgeting Source: 2009, 2010, 2011 Comprehensive Annual Financial Report

18. From the Superintendent’s Annual Financial Report • On June 30, 2011: “Unreserved Fund Balance was $56.5 Million or 21.1 % of the total general fund expenditure”

19. From the ECSD’s Board Policy • “It shall be the goal of the District to maintain a minimum unrestricted operating fund balance for non-recurring expenses of 3.5% of anticipated total revenue.”

20. It’s All About Choices • If we truly want to make ECSD a place people want to work, then we need to make a better choice. • ECSD does not stand for • Escambia • County • Securities • Deposit

21. Be INformed, Be INvolved, Be INvested Union of Escambia ESP EEA