Budget Proposal: Many Districts Would Still Need to Find SavingsCategories: California Developments,Early Retirement Incentives,Legislative Updates,PARS News
Declining enrollment, anticipated economic slowdown and continued pension increases still strain istrict budgets: a well-designed early retirement plan through PARS can help
Governor Gavin Newsom’s proposed 2019-20 California budget helps slow the ongoing increasing CalSTRS employer contribution rates, but while the financial help would be appreciated, experts agree that for many districts, the impact will be minimal. Loss of state revenue from declining enrollment, the economic slowdown that many expect is coming, and the large upcoming CalPERS contribution increases, may offset much, if not all, of the STRS relief.
A successful solution implemented by California school and community college districts for over thirty years is the PARS early retirement incentive known as the Supplementary Retirement Plan (SRP). This plan offers districts a constructive and appealing tool for reducing labor costs and restructuring a workforce, all while avoiding disruptive layoffs and retaining skilled employees.
PARS provides a complimentary objective fiscal analysis to help districts accurately quantify the potential savings or costs associated with any potential offering. With PARS’ guidance, plans can be tailored based on targeted employee groups, benefit amounts, timelines or other unique features to help ensure a plan ultimately meets a district’s objective.
It’s Not Too Late to Begin This Year…
- Early FEBRUARY – Contact PARS to begin the analysis.
- Late FEBRUARY – Finalize the analysis, determine plan design and open the enrollment window.
- MARCH – Distribute employee informational packets, hold orientation meetings and enrollment workshops.
- APRIL & MAY – Close the enrollment window and conduct the “Post-Analysis” based on the actual plan enrollment. District elects to move forward with the plan if it achieves the anticipated cost-savings and objectives.
- JUNE – Participating employees resign and/or retire.