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Walker Reform Plan to Save School Districts up to $68 Million

FOR IMMEDIATE RELEASE July 22, 2010 Contact: Jill Bader (414) 453-2010 Email: Jillb@scottwalker.org Twitter: @JillBader

Walker Reform Plan to Save School Districts up to $68 Million, Local Governments up to $242 million Per Year Says Milwaukee Public Schools Will Save $20 Million, Greenfield $349,000 Per Year

Wauwatosa – Scott Walker, Milwaukee County executive and candidate for governor, was joined today by parents of public school students atGreenfield High School, as he announced his latest “Brown Bag Idea.”  His reform plan will save school districts $68 million per year and local governments up to $242 million per year in health care savings.  


Walker’s proposal would allow local governments and school districts currently paying higher premiums for health care than the state pays to enroll in the state employee health plan.  By enrolling in the state plan Milwaukee Public Schools will save up to $20 million a year and Greenfield schooldistrict could save up to $349,000 a year.  



“This reform will help local governments keep property taxes low and keep more money in school budgets for students and teachers,” said Walker.  “One of the greatest budget challenges for cash-strapped school districts and local governments are the healthcare costs for our employees.  By offering them the opportunity to use the state employee health plan for the first time, school districts can save up to $68 million and local governments up to $242 million a year.

Walker noted that school districts and local governments that are already paying less won’t switch to the state employee healthcare plan.  



Scott’s plan to save on healthcare costs is the most recent of his “Brown Bag Ideas” - policy proposals to cut spending and lower taxes that follow his “Brown Bag Guide to Government”:

  • Don’t spend more than you have.
  • Smaller government is better government.
  • People create jobs, not government.

Recently, Walker outlined his Brown Bag Idea to save $180 million a year through pension savings, and announced that as governor, he would voluntarily contribute to his own government pension.  He also announced his plan to save $284 million per year by permanently eliminating 4,000 vacant state positions.

Scott Walker was elected Milwaukee County executive on a wave of reform, after a pension scandal revealed government workers were walking away with millions in taxpayer money.  Since then, he has introduced eight consecutive budgets without a tax levy increase from the previous year, cut the debt by 10%, reduced the workforce by 20%, and had an $8.9 million surplus in his most recent budget.

As Milwaukee County executive, Scott Walker has given $370,000 of his personal salary to the taxpayers over eight years, voluntarily reduced his own pension benefit, and in his most recent budget successfully worked on a bipartisan proposal that asked county employees to contribute to their government financed healthcare plans, saving millions for the taxpayers.

Scott and his wife Tonette live in Wauwatosa with their two sons, Matt and Alex.

Scott’s Plan:

  • Allows local governments currently paying higher monthly premiums for health care than the state pays its employees to enroll in the state employee health plan.
  • Local governments who control costs better than the state will be allowed to keep their current plans.
  • Scott’s plan will include school districts, counties, cities, villages and towns.
  • Scott’s plan will save school districts alone more than $68 million per year.
  • At least 256 school districts will save money – on average $268,541 per year.
  • The biggest saver will be the Milwaukee Metropolitan School District at $20 million in annual savings.
  • Local governments could save as much as $242.2 million per year.

Background

  • The methodology for calculating potential school district savings follows the methodology used by Wisconsin Policy Research Institute’s report in 2005 on switching schools to the state health plan.[1]
  • Of Wisconsin’s 426 school districts, 379 report health insurance premium data to the Wisconsin Association of School Boards.[2]
  • The cost to each district, for both single and family coverage, was compared to the cost of the lowest-priced plan in that county for the state employee health care plan.[3]
  • To estimate potential school district savings, it was assumed that one-third of employees choose single coverage while two-thirds choose family coverage in each district.  Estimates will vary based on differences in this assumption.
  • Local government savings are impossible to estimate because there is no central database of local government health care premiums.  Using the school savings of $68 million and dividing it by Wisconsin’s 59,943 teachers[4], the per teacher savings is $1,137 per year.  Multiplying this by the 212,931[5] local government employees equals $242.2 million.  This likely represents the upper limits of savings as local government health plans tend to be less generous than school district plans.

Milwaukee Area Savings: 


School District Savings
Brown Deer $168,437.28
Cudahy $305,417.83
Fox Point J2 $41,516.51
Franklin $79,113.89
Glendale-River Hills $158,154.13
Greendale $158,367.63
Greenfield $349,247.21
Maple Dale-Indian Hills $93,479.02
Milwaukee $20,006,376.55
Shorewood $131,856.60
West Allis-West Milwaukee $108,572.95

 

[1] WPRI, Health Insurance for Wisconsin Public Schools, The Case for Competitive Bidding, p. 13

[2] WI Association of School Boards, Teacher Health Insurance Cost & Contribution Comparisons, 2009-2010

[3] WI Department of Employee Trust Funds, “It’s Your Choice” Monthly Group Health Rates for CY 2010 & Location of Health Plans

[4] WI Department of Public Instruction District Staff Totals

[5] 2009-2010 State of Wisconsin Blue Book, p. 749

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