Teachers in West Fargo will no longer receive a cash incentive to retire as soon as they are eligible.
The School Board voted unanimously Monday to eliminate what it calls an "early retirement payment" effective June 30, 2007. Until then, the board will set aside an unspecified amount of money to be shared by teachers applying for the benefit.
Teachers close to retirement said the board's decision caught them by surprise and makes them feel unappreciated.
"Some of us have been making plans to spend that money," said Rich Cwikla, a technical education teacher at the high school.
Cwikla was one of about 25 teachers who attended the meeting to protest the change. "We've been counting on it."
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The board adopted an early retirement policy for teachers in 1995. It isn't part of the teachers' negotiated agreement.
A decade ago people believed school districts saved money by encouraging more experienced teachers to retire and replacing them with younger, less experienced teachers, said Superintendent Chuck Cheney.
Now districts want to keep experienced teachers - often considered the best - in the classroom.
"Giving them an incentive to retire is disingenuous with the realities of hiring highly qualified teachers," Cheney said.
Under the policy, teachers eligible to retire with full benefits under the teachers' retirement plan also could apply for a cash incentive from the district. The amount ranged from 10 percent to 80 percent of the teacher's salary, depending on years of service and how many years he was past retirement eligibility.
Last year, the School District spent $310,000 on early retirement payments for seven employees. The highest scheduled salary, which goes to teachers with the most experience and education, is about $63,000 this year.
West Fargo also pays 15.5 percent of each teacher's salary into a pension. Teachers can retire with full benefits at age 65 or when their age plus years of experience equals 85. Payments go up if they defer retirement.
Robin Hill, the district's human resource director, said it is difficult to know whether the district saved money by offering incentive payments. Teachers who received them may have retired at the same time without them, she said.
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Of the 55 retirees since 1995, 34 have been eligible for the early retirement payment, she said.
Mark Berntson, president of the West Fargo Education Association, said early retirement payments are beneficial to both the district and employees.
Older teachers not only receive a higher salary, but often incur more health-care costs, he said. By offering an incentive, the district financially helps teachers who are more willing to take a lower pension payment.
"A sudden cutting off of this financial support is bad for morale and bad for financial planning," he said.
Readers can reach Forum reporter Erin Hemme Froslie at (701) 241-5534
