Wow, is Milwaukee Public Schools in trouble.
Back in 2004, I did a story for the Milwaukee Journal Sentinel that found Milwaukee Public Schools was spending 51 cents on benefits for every dollar spent on salaries in 2003. That was projected to increase to 55 cents in 2004. Recently, JS reporter Alan Borsuk did a story noting (toward the back) that MPS was now up to 60 cents on benefits for every dollar in salary and this was expected to increase to 63 cents next year.
That's a mind-blowing trend. If it continues - and it will, unless major changes are made in its benefits structure - MPS will be forced to gut its staff, impose annual double-digit tax increases or both. The heart of the problem is health care: The plan for employees has few cost controls. And the plan for retirees (many
of whom get lifetime health insurance) is funded on a "pay-as-you-go" basis. The latter is an actuarial nightmare: Each year there are more retirees covered by the health insurance and ever-higher premiums, but the system hasn't put any money aside to pay for this growth, as a government pension plan normally does. So the costs have started to mushroom.
| Newsletter signup | Send us your ideas