Early retirement incentive programs: reviewing the pros and cons

With the 10% across-the-board cut plus declining enrollment, I’ve shared some perspectives about our future in past editions of Intersections.  A couple people replied wondering if an early retirement incentive might be the magic bullet or at least a piece of the solution.  One person pointed out that early retirement incentives are used by some LEAs.

AEAs are funded quite differently than LEAs.  An LEA covers the cost of the early retirement incentives with a special property tax levy called the Management Levy.  There is no control or ceiling on this levy.  AEAs do not have that option.  An early retirement incentive comes right out of the General Fund.  AEAs need to be very careful that an incentive program doesn’t actually cost the Agency more money.

The AEA 267 Board believes there is little financial advantage to our Agency if we implemented an early retirement incentive.  We believe we can manage the current economic crisis with a thoughtful and gradual reduction in our workforce, accomplished primarily with retirements and other attrition, over the next two to four years.  This belief does not guarantee there will not be some lay-offs, but for the most part, lay-offs can be avoided and certainly will not occur in large number.

–Dr. Dean Meier, AEA 267 Chief Administrator

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