Public schools in New York could save $500 million a year, offsetting fully one-third of Governor Cuomo’s proposed cut in K-12 state aid, if they adjusted their health insurance premium-sharing arrangements for teachers to match those for state government employees, according to a Citizens Budget Commission (CBC) analysis cited by Governor Cuomo in his budget presentation.

CBC said it constructed a database of premium breakdowns for school districts from 517 teacher union contracts posted at SeeThroughNY, the Empire Center’s transparency website.  New York City alone would save two-thirds of the the total—some $310 million for active and retired teachers.

State government employees are required to kick in 10 percent of the premium for individual health coverage and 25 percent of the premium for family coverage. Including more generous premium coverage that some districts give to senior teachers, 58 percent of the districts met or exceeded the state’s employee share of 10 percent individual coverage, but only four percent required teachers to pay at least 25 percent of family coverage premiums.  Nearly half set the teacher share of family coverage at 10 percent or less.

In New York City, teachers are not required to pay anything towards their basic health insurance, unless they opt into a plan offering more coverage options. Including the city, only nine percent of districts in the CBC database required no teacher contribution to health insurance premiums.

As the governor pointed out, districts could avoid threatened layoffs and program cutbacks if their teachers carried a bigger share of the health insurance burden. But as Cuomo did not point out, those benefits are subjects of collective bargaining. Districts now have scant leverage to press teacher unions for concessions under the state Taylor Law. (Layoff threats rarely inspire sacrifices.)

It would be a big help to districts if the state repealed the Taylor Law’s so-called Triborough amendment, which mandates that contract terms remain in effect even after a contract has expired, giving unions less incentive to settle.  Cuomo, so far, isn’t going anywhere near Triborough. He has instead punted mandate relief issues to a Redesign Team comprised of “stakeholders” including union representatives, who oppose any change in the status quo.

Sooner or later, the governor has to put up or shut up in this area. Cuomo can’t keep claiming that districts aren’t doing enough to control spending if he isn’t willing to get behind the Taylor Law reform that would give them the tools to help control compensation costs.

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About the Author

E.J. McMahon

Edmund J. McMahon is Empire Center's founder and a senior fellow.

Read more by E.J. McMahon

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