Pension changes not enough for Pittsburgh city schools
Gov. Tom Corbett's proposed changes to the state pension system for educators could save Pittsburgh Public Schools money, but not enough to avert a potential financial disaster, district officials warned.
In Tuesday's budget update before the city school board, district officials estimated that the pension plan would reduce the district's projected operating deficit from $42.8 million to $38.4 million in 2015. That's when the district expects to go broke if it doesn't change course.
“Are you still forecasting a wreck in 2015?” asked board member Theresa Colaizzi.
“That's what we're still forecasting,” answered Ron Joseph, director of budget development, management and operations.
The district has an operating budget this year of $521.8 million and took $9.9 million from its fund balance. The district expects to wipe out its fund balance in 2015 and end up $16.6 million in the hole if it takes no further action.
The district has been plagued by flat revenue from real estate taxes; declining enrollment because of charter, parochial and private schools; rising payments for charter schools; and pension costs.
Joseph said Corbett's proposed budget for 2013-14 would increase state money to the district by $1 million, to $183 million.
His pension plan would change the Public School Employees' Retirement System for employees hired after July 1, 2015, from a defined benefit plan to a plan similar to a 401(k), change the formula for future benefits of current employees and limit increases of employers' contributions. The employers' increases would decrease from the mandated 4.5 percent to 2.25 percent in 2013-14.
Superintendent Linda Lane suggested caution about Corbett's proposal.
“There's going to be a lot of pushback on this pension plan,” she said.
Bill Zlatos is a staff writer for Trib Total Media. He can be reached at 412-320-7828 or email@example.com.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Propel Hazelwood charter school in Pittsburgh plans open house
- Charter school planned for former North Catholic building seeks state OK
- Freeh, Tomalis emails at issue in appeals court hearing