CAT Tracks for February 19, 2003 WOE IS MAMA CAT

The EIA - Education Intelligence Agency - put out an interesting article concerning the IEA this week. (Nah...I didn't make this one up!)

National Education Association state affiliates with declining membership numbers are also, naturally, facing some financial difficulties. For years the unions have budgeted on steady, predictable growth numbers, and a sudden drop-off in dues income can lead to deficits. What must be troubling for NEA this year is that some of its affiliates experiencing membership growth are still struggling with money problems.

Last week, EIA reported that one of the growing affiliates, Missouri NEA, announced possible staff layoffs and expects labor problems of its own when staff contracts expire in September. The Illinois Education Association (IEA), which showed relatively strong membership growth numbers in a poor recruiting year for NEA, has a multi-million dollar budget deficit, even after draining financial reserves from previous years.

The culprit, according to IEA headquarters, is the staff’s retirement plan. Staff retirement costs have been cited by both the Michigan Education Association and the Ohio Education Association in recent years for those affiliates’ budget deficits. Blaming a poor stock market, IEA officials found themselves $15 million short. After applying reserves and deciding to accept a $200,000 penalty for not meeting the required asset-to-liability ratio on the fund, IEA still needs to make up some $6 million. The proposed plan from the IEA budget committee will require a $10 per member annual special assessment for the next two years (in addition to any other required dues increase), and “staff cost reductions” of $2.4 million.

How those “staff cost reductions” will be realized will largely depend on the staff. It is possible the IEA staff union will negotiate a pay cut or freeze with IEA officials. The other possibility is layoffs, to which the staff union could reluctantly agree or fight tooth-and-nail. As other NEA affiliates have learned in the past, a union of professional contract negotiators can be a formidable opponent on the other side of the bargaining table.

IEA will hold its annual state representative assembly on March 12-15. The budget problems will be the main focus of debate.

POSTSCRIPT: Needless to say...savy CATs that you are...a dues increase looms on the horizon. The original projection (always high...just like in negotiations...which is what it is) was for a $30+ increase in IEA dues for next year! Because of vocal membership objections, that was whittled down to a more "common" $7. BUT...an alternative plan being proposed is for a one-time surcharge...well "one-time" for each of the next two years...of $10 on each member. The reasoning behind this approach is that any "regular" dues increase would be permanent. (We have NEVER had a dues decrease!) The surcharge would automatically expire at the end of the designated period...just like our December/June bonuses of old! (And WE know what happened then...Argh!)

Stay tuned...as the article says, this is all up for debate next month. We WILL pay more next year...as usual. How much and in what form has yet to be determined.