Dr. Henry C. Mabry, AEA Executive Secretary
The economy is improving. The most renowned national economic experts in the country say that 2014 and 2015 will be strong growth years for our economy. This means the Education Trust Fund (ETF) should grow this year and next year by hundreds of millions of dollars.
According to new figures from the Federal Reserve, economic growth along with inflation should increase by five percent this year and between five percent and six percent next year. This means ETF growth would amount to $550 million if Alabama growth and inflation matches the growth figures for the rest of the country.
If Alabama grows like the rest of the country, the state would have enough to pay for a six percent raise, pay over $80 million to help PEEHIP, and pay off what is owed to the Education Rainy Day Fund.
The Republican legislative leadership (a.k.a. The Speaker of the House and President Pro Tempore of the Senate) wants no raise to be given even though the money will be there if Alabama grows like the rest of the country and the national experts are correct. The Republican legislative leadership stubbornly wants to stick with the Rolling Reserve spending cap of $135 million and leave up to three times as much money squirreled away in a savings account.
The Rolling Reserve Act intentionally leaves out growth for next year in calculating next year’s spending. Budgeting for 2015, under the Rolling Reserve Act, is calculated by applying growth of 3.06 percent to 2013 revenue. It does not matter that growth is expected to be five percent for 2014 and more than five percent for 2015. Under their formula, no consideration will be given for growth in 2015 for the 2015 budget.
What does this mean? This means that a family of four that earned $48,000 last year, $50,000 this year, and will get a raise to $52,500 next year can only spend $48,000 plus $1,500 (3.06 percent growth) next year. This hypothetical family is making $50,000 this year and will make $52,500 next year, but it could only spend $49,500 next year while being forced to set aside $3,000, if the family was constrained by the Rolling Reserve Act formula.
This is all fine and good if a family has no extra expenses, but costs go up and a family of four would be hard pressed not to need the ability to spend an extra $3,000 on necessities. This hypothetical family may need roof repairs or braces for a child, but under Rolling Reserve budgeting this family would have to set that $3,000 aside for the next time a recession hits.
It will take an increase of 5.25 percent for educators to break even for this four year term thanks to the pay cut imposed by the anti-education Republican leadership. These fellows cut all educator pay in 2011, 2012, and 2013. Educators’ pay will continue to have been cut this coming October unless educators get at least a 5.25 percent adjustment in pay. Again, it will take a pay raise of 5.25 percent for educators to just break even from the pay cut the Republican supermajority put on educators in 2011 and thereafter. Anything less means a pay cut for this four year term. This would be the first pay cut during a legislative quadrennium since Republican President Herbert Hoover reined over the Great Depression.
We are not impressed with Gov. Robert Bentley’s two percent pay increase proposal. The governor admitted that educators paid by themselves over a half-billion dollars in extra out-of-pocket costs that were counted as part of the state’s $1 billion in “savings.” What does this mean? This means that every dime spent on any proposed raise up to 5.25 percent will have already been paid for by educators. That’s right. Educators have already been charged by the legislature an amount equal to any raise up to 5.25 percent. So, if educators are given a raise, then the legislature is only giving back what they have already taken from educators’ pockets.
If the anti-education Republican leadership took your money away, then they can give it back. If they say they don’t have the money to make educators whole, then they have spent the money on other things, and we all know that these leaders have not spent the money in the classroom.
For three years, we have been keenly aware that House Speaker Mike Hubbard and Sen. Del Marsh care not one iota about public education. On thirteen occasions, the Republican legislative leadership has attacked public education and they must be prideful to have orchestrated more education funding cuts in Alabama than in any other state in the country since 2008.
These “leaders” not only want to starve our education employees, but they want to replace them with young, short term, cheap workers. Our educators have been taken for granted, been taken advantage of, and have been forced to work more under worse conditions. Does the leadership of the House and Senate care about this situation? No.
Educators have gone without a raise since 2007. That was almost seven years ago. The recession ended four years ago, but educators’ paychecks have shrunk instead of getting bigger since the recession ended thanks to the Republican “leaders.” This is not right. These “leaders” need to be sent home to count their personal fortunes instead of taking hundreds of millions out of educators’ pockets.
If educators want a six percent raise then educators need to contact their legislators in the House and Senate and tell them that educators deserve a pay raise. This includes retirees concerning a COLA. Retirees need to ask, too, and retirees do not need to listen to excuses either. If legislators tell active or retired educators that there is no money for a six percent raise or not even enough for a one percent, two percent, four percent, or five percent raise, then such legislators are taking educators for fools.
The elections take place in June and November. Legislators need to know that educators and retired educators are watching their actions and that legislators will be held accountable for what they do. The Republican supermajority has cut educators’ pay, made health insurance out-of-pocket costs increase, and they have stripped away many tenure rights. Most of the Republican supermajority members have attempted to raid hundreds of millions of dollars from education, most have worked to increase class sizes, most have worked to end tenure altogether, most have worked tirelessly to create corporate run schools, and most have worked to give public school money to parents of private school students while giving Bob Riley a way to make millions off our public schools. The least they can do is provide a six percent raise to repay educators for the pay they cut in 2011, 2012 and 2013; and for the effect in 2014 and thereafter.
Please contact your legislators and tell them to give a six percent raise/COLA and to fund PEEHIP. If they refuse, then once again you know where you stand with these people. Further, if they refuse, then at least you will have the opportunity to do something about it beginning just a little over four months from now.