NEW CASTLE Teachers can opt for severance deal
The district can save $20,000 a year for teachers who accept .
By LAURE CIOFFI
VINDICATOR NEW CASTLE BUREAU
NEW CASTLE, Pa. -- Administrators say a one-time voluntary severance package offered to New Castle Area school teachers is an effort to reduce costs.
School board members approved the agreement at a special meeting Wednesday. It calls for severance payments up to $25,000 to any teacher who has more than 15 years experience and resigns this year.
Teachers must inform the district in writing before the beginning of each semester if they plan to take the severance package, according to the agreement.
Number eligible: Nick DeRosa, assistant schools superintendent, said 150 of the district's 275 teachers are eligible. He would not speculate how many people might take the severance package.
"We expect it will be people who are looking to retire anyway or someone who is looking to go to another school district or change careers," DeRosa said.
Administrators estimate the school district will eventually save about $20,000 per year for each teacher who takes the severance package.
Why it saves money: DeRosa explained that teachers with more than 15 years experience earn an average of $61,000 per year. They would be replaced with teachers at the bottom of the pay scale, earning $34,000 per year, he said.
The lower salary combined with the severance payment would equal the salary of the more experienced teacher, but after that one-time payment is made there would be about a $20,000 per year savings, he said.
The severance package is based on the number of years of service and unused sick days. Teachers can take the money in one lump sum or spread payments out over three years, according to the agreement.
Teachers can also put the severance cash in an escrow account that will pay for medical insurance from the district.
District administrators had been working on an early retirement incentive package with the teacher's union, but had been unable to agree on the terms, DeRosa said. The severance package was suggested by school board member Peter Yerage and union officials agreed to the idea, he said.
In between: DeRosa said the severance package is an effort to help teachers who want to retire, but are not old enough or do not have enough years of service under state retirement guidelines.
Anyone who does not meet state retirement guidelines risks losing money from his pension, DeRosa said.
Teachers will receive the details of the severance package agreement Friday with their paychecks, DeRosa said.