OPEB liability

Memphis City Schools retiree benefits up in the air following state attorney general’s opinion

PHOTO: Kayleigh Skinner
Retired educators attend a forum in Memphis last summer before the Shelby County Board of Education to discuss proposed cost-cutting changes to their retirement plans.

Retired employees of the former Memphis City Schools face uncertainty over which entity is eventually responsible for paying for their benefits after the state attorney general issued an opinion that the obligation is not owed by Shelby County.

Shelby County Schools, which was formed in a 2013 merger of the former city and county districts and is funded through the Shelby County Commission, has budgeted to pay for those benefits through the fiscal year ending June 30.

However, an opinion issued Tuesday by Tennessee Attorney General Herbert Slatery is expected to make the cash-strapped district reexamine its $1 billion liability in the matter.

Slatery said that, for Shelby County to assume the former city district’s indebtedness when school operations were transferred to Shelby County Schools, the Shelby County Commission would have to vote to assume the debt, which it didn’t.

And County Commissioner David Reaves doesn’t foresee such a vote happening based on the current structure of the liability.

Reaves hopes that the opinion, which he requested through state Sen. Brian Kelsey, will motivate the commission, Shelby County Schools and the city of Memphis to come to the table to develop a plan for managing the former city school system’s Other Post Employment Benefits, known as OPEB, which are retirement benefits such as health and life insurance but excluding pensions.

"People have been kicking this down the road for years, but hopefully this opinion will create an environment where we finally put this OPEB monster to bed."David Reaves, county commissioner

“People have been kicking this down the road for years, but hopefully this opinion will create an environment where we finally put this OPEB monster to bed,” Reaves said Wednesday. “It’s the perfect environment to fix this, but it’s going to take some tough decisions.”

New Memphis Mayor Jim Strickland immediately distanced the city from any obligation in the matter, however.

“It’s important to note that Memphis City Schools was a special school district, and was separate and apart from city government,” Strickland said in a statement. “The attorney general was not asked if city government is responsible for the special school district debt. The attorney general was asked if Shelby County government was responsible for the special school district debt.”

Reaves questioned that line of thinking, since city council had to approve the former city school district’s budget and since the district was cited in the city charter.

“These are the first salvos, and everybody is staking out their positions. But we need to call a spade a spade. Ultimately, we need to sit down to figure out how to resolve this,” he said.

Reaves said he hopes the matter does not end up in court, since Slatery’s opinion is not a binding judgment.

“Will it go to litigation? It’s highly possible, but I think that would be foolish. The wisest thing is for all parties to sit down and come up with a plan,” said Reaves, a former member of the Shelby County school board. “Out of the three parties, the city of Memphis is the only one who’s not kicked in any money for OPEB liability.”

Shelby County Schools has been weighed down by its $1.5 billion OPEB liability for city and county district retirees and has not been contributing enough to cover retirees’ real costs, prompting admonitions from county commissioners to address the issue.

Last summer, Superintendent Dorsey Hopson called OPEB “a huge gorilla around our neck” and presented options that ranged from cutting spouses from the district’s OPEB plan to providing incentives to purchase health insurance through the federal Affordable Care Act. However, as hundreds of retirees protested the proposals, district leaders backed off and opted for a comprehensive review of the issue.

Reaves said this week’s legal opinion should serve as a wake-up call to the school district, the county, the city and retirees that something is going to have to give.

David Reaves
David Reaves

“We’re all reasonable people and nobody is looking to put retirees at risk,” he said. “But we need to understand that the level of benefit we’ve been giving for a lot of years is probably going to have to change. It’s just not sustainable. We’re going to have to figure out how to fund a new OPEB level, and we need the city to be part of that discussion.”

Last summer, angry retirees contended that the district was seeking to save money on the backs of sick senior citizens by breaking a promise made to educators decades ago.

Reaves traces the problem to the former city school district.

“This is not the employees’ fault; this is about government mismanagement,” he said. “These promises given to employees were broken years ago when the previous school system didn’t budget for it. Now we have to come up with a different plan that everyone can swallow and, at the same time, keep us from going bankrupt. And we need the city to be part of that discussion.”

What's Your Education Story?

As the 2018 school year begins, join us for storytelling from Indianapolis educators

PHOTO: Dylan Peers McCoy/Chalkbeat
Sarah TeKolste, right, and Lori Jenkins at a Teacher Story Slam, in April.

In partnership with Teachers Lounge Indy, Chalkbeat is hosting another teacher story slam this fall featuring educators from across the city.

Over the past couple of years, Chalkbeat has brought readers personal stories from teachers and students through the events. Some of our favorites touched on how a teacher won the trust of her most skeptical student, why another teacher decided to come out to his students, and one educator’s call to ramp up the number of students pursuing a college education.

The event, 5:30 p.m. Thursday, Sept. 13, is free and open to the public — please RSVP here.

Event details:

5:30 p.m. to 7:30 p.m.
Thursday, Sept. 13, 2018
Tube Factory artspace
1125 Cruft St., Indianapolis, IN 46203
Get tickets here and find more on Facebook

More in What's Your Education Story?

School safety

Hiring more security officers in Memphis after school shootings could have unintended consequences

PHOTO: Jahi Chikwendiu/The Washington Post/Getty Images

Tennessee’s largest district, Shelby County Schools, is slated to add more school resource officers under the proposed budget for next school year.

Superintendent Dorsey Hopson earmarked $2 million to hire 30 school resource officers in addition to the 98 already in some of its 150-plus schools. The school board is scheduled to vote on the budget Tuesday.

But an increase in law enforcement officers could have unintended consequences.

A new state law that bans local governments from refusing to cooperate with federal immigration officials could put school resource officers in an awkward position.

Tennessee Education Commissioner Candice McQueen recently reminded school personnel they are not obligated to release student information regarding immigration status. School resource officers employed by police or sheriff’s departments, however, do not answer to school districts. Shelby County Schools is still reviewing the law, but school board members have previously gone on the record emphasizing their commitment to protecting undocumented students.

“Right now we are just trying to get a better understanding of the law and the impact that it may have,” said Natalia Powers, a district spokeswoman.

Also, incidents of excessive force and racial bias toward black students have cropped up in recent years. Two white Memphis officers were fired in 2013 after hitting a black student and wrestling her to the ground because she was “yelling and cussing” on school grounds. And mothers of four elementary school students recently filed a lawsuit against a Murfreesboro officer who arrested them at school in 2016 for failing to break up a fight that occurred off-campus.

Just how common those incidents are in Memphis is unclear. In response to Chalkbeat’s query for the number and type of complaints in the last two school years, Shelby County Schools said it “does not have any documents responsive to this request.”

Currently, 38 school resource officers are sheriff’s deputies, and the rest are security officers hired by Shelby County Schools. The officers respond and work to prevent criminal activity in all high schools and middle schools, Hopson said. The 30 additional officers would augment staffing at some schools and for the first time, branch out to some elementary schools. Hopson said those decisions will be based on crime rates in surrounding neighborhoods and school incidents.

Hopson’s initial recommendation for more school resource officers was in response to the school shooting in Parkland, Florida, that killed 17 people and sparked a wave of student activism on school safety, including in Memphis.

Gov. Bill Haslam’s recent $30 million budget boost would allow school districts across Tennessee to hire more law enforcement officers or improve building security. Measures to arm some teachers with guns or outlaw certain types of guns have fallen flat.

For more on the role and history of school resource officers in Tennessee, read our five things to know.

Sheriff’s deputies and district security officers meet weekly, said Capt. Dallas Lavergne of the Shelby County Sheriff’s Office. When the Memphis Police Department pulled their officers out of school buildings following the merger of city and county school systems, the county Sheriff’s Office replaced them with deputies.

All deputy recruits go through school resource officer training, and those who are assigned to schools get additional annual training. In a 2013 review of police academies across the nation, Tennessee was cited as the only state that had specific training for officers deployed to schools.