New healthcare plan lifts insurance cap, saving Kenai educators hundreds of dollars

Teachers rally with hours left to reach a contract agreement before going on strike. (Sept. 16, 2019)
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KENAI PENINSULA, Alaska (KTUU) - Update, 7:45 p.m. Tuesday:

A crisis has been averted in the Kenai Peninsula Borough School District. Apart from a two hour delay to the start of the school day Tuesday, it's business as usual for the 8,000 students and more than 1,000 staff members.

The tentative agreement includes a pivotal change to employee health insurance coverage that will reduce the amount teachers have to pay in premiums. The district has agreed to remove the cap on a high-deductible insurance plan, and split contributions 85 percent to educators' 15 percent.

On the previous plan, once the cap was met KPBSD employees had to split spillover costs evenly with the district. This was steadily increasing the cost of premiums.

KPEA President David Brighton acknowledged that removing the cap was a huge win for educators -- something they had been trying to get the district to budge on for over a year.

"I think it was a really good compromise. It addressed our concerns for the rising costs of healthcare," Brighton said. "It's a big success for us, and it's a relief that we could guarantee affordable healthcare for our employees."

Since the agreement is retroactive, KPBSD will pay the cost owed from exceeding the insurance cap in FY19, about $668,000. Part of the reason for doing this is the district's Employee Healthcare Reserve Account has to have a minimum balance of $750,000. Paying back the cap will replenish the account, and save each district employee over $600 in healthcare costs.

The district will also pay incremental salary raises: 1/2% for 2018 (retroactively paid), 1% for 2019, and 2% for 2020.

These changes will buy time for both parties to get back to their highest priority, which they agree is ensuring quality education for KPBSD students.

"Everybody worked hard so we could come to a resolution and move forward," Erkeneff said. "At any rate, we averted a strike and work stoppage at our schools."

Erkeneff says the district intends to transition to an outside healthcare system, a conversation better left for when collective bargaining starts back up in Jan. 2021.

Update, 10:45 a.m. Tuesday

Kenai Peninsula educators and school district officials are breathing sighs of relief after reaching a tentative contract agreement for the time period of July 1, 2018 through June 30, 2021.

According to a Kenai Peninsula Education Association (KPEA) press release, they along with the Kenai Peninsula Education Support Association (KPESA) finalized the agreement with the Kenai Peninsula Borough School District at 1:37 a.m. Tuesday morning.

This ends an extended contract deliberation and prevents a teacher strike and school closure that would have gone into effect 7 a.m. Tuesday.

All 42 schools in the KPBSD opened with a 2-hour delay, and were otherwise not impacted by the early morning decision. Because the school district had warned families to be ready for emergency school closures, they are excusing student absences for Tuesday.

All sports and extra-curricular activities will resume as normally scheduled.

District officials and educators have both released statements on the long-anticipated contract agreement.

“After months of hard work and strained emotions the bargaining teams came together tonight (Monday) in the spirit of compromise,” KPBSD Superintendent John O’Brien said in the KPEA press release. “Together we can all now focus on our core mission: educating the children of the Kenai.”

“This tentative agreement represents a big step forward for everyone working to improve the lives of Kenai Peninsula students,” KPEA President David Brighton said in the KPEA press release. “I’m proud of the work we’ve done, and I’m pleased that we are able to find a compromise with the District.”

We will have more on the specifics of the agreement when KPBSD releases that information later today.

Update, 3:30 a.m. Tuesday:

A Tentative Agreement has been reached between KPBSD and KPEA & KPESA
for a three year contract for the time period of July 1, 2018 through June 30, 2021.

All 42 KPBSD schools will open with a two-hour delay start on September 17, 2019

Sports and after-school activities will take place on a normal Tuesday schedule.

This is a developing story keep it to for updates.

Update, 10:00 p.m. Monday:

KPBSD's Pegge Erkeneff confirms the district has emailed a package proposal to the Kenai Peninsula Education Association, and they are currently reviewing it.

Update, 9:15 p.m. Monday:

The school board took a break from their closed-door executive session in Kenai Monday evening, where they are attempting to come up with a counter-proposal to prevent Tuesday's strike.

According to Kenai Peninsula Borough School District spokesperson Pegge Erkeneff, a board member confirmed that after two hours they still had not found a solution.

A teacher strike appears to be imminent, however that could change if negotiators have a breakthrough before 7 a.m. Tuesday.

Update, 2:45 p.m. Monday:

The clock is ticking for the Kenai Peninsula Borough School District to hammer out a contract proposal to meet teachers' demands and prevent a strike.

The Kenai Peninsula Education Association issued its 72-hour notice of intent to strike on Friday evening, citing concerns that the district's current offer has not lowered healthcare premiums as requested. According to KPBSD spokesperson Pegge Erkeneff, the district's negotiating team worked through the weekend on a counter-offer, and those efforts continued as of Monday afternoon.

Erkeneff says KPBSD teachers and support staff have the highest healthcare costs of any district in Alaska. For the 2018 - 2019 school year, teachers chose either of two plans: the Kenai Traditional Health Plan (costing the district $23,081), or the Kenai High Deductible Health Plan (costing the district $21,245). That's compared to a $20,928 district healthcare contribution for the Mat-Su, and $20,340 for Anchorage.

The Kenai Peninsula Education Association's Sept. 5 proposal, which expired 4 p.m. Friday, would have increased the district's annual healthcare contribution to $27,076, according to Erkeneff.

There currently is not a set time for negotiations to continue. Erkeneff says the school board is holding an executive session to consider an updated proposal to present to educators, but did not provide details on what that proposal would entail.

Theoretically, both sides have until 7 a.m. Tuesday morning to come to an agreement. KPEA President David Brighton told Channel 2 educators are prepared to work through the night to reach an agreement and prevent a strike.

Original Story:

The Kenai Peninsula Borough School District and its educators are hoping for a contract resolution after teachers issued a 72-hour notice to strike Friday evening. If they do not reach an agreement, the strike will shut down all 42 schools in the district beginning 7 a.m. Tuesday.

"Starting Tuesday, parents need to plan for an emergency school closure, until further notice," KPBSD’s Pegge Erkeneff cautioned.

575 days of negotiation and still no contract -- this has driven KPBSD teachers to issue their official intent to strike. Both sides want to avoid school shutdowns, but high healthcare costs make the odds of reaching a resolution uncertain.

"Educators are very frustrated that they've worked an entire year without a contract, and now we're going back to work, still without this contract settled,” President of the Kenai Peninsula Education Association David Brighton said. “We’re halfway through a 3-year contract term that hasn’t even been finalized.”

KPEA had an offer on the table which expired at 4 p.m. Friday, according to Brighton. Erkeneff says the district was working on what they thought was a promising counter-proposal when teachers issued their intent to strike.

A breakdown of contract offers, from KPBSD.

Erkeneff says the district’s last offer added over $1 million to increase teacher salaries at the beginning of each school year. However, healthcare seems to be the enduring point of contention.

"Finding some fair solution for both sides, recognizing that the cost of healthcare is rising, has been a challenge," Erkeneff said. “Bridging that gap has continued to be the sticking point.”

Both sides have agreed to a more affordable, high-deductible health plan -- but questions remain around how much employees should contribute. Brighton says the inability to reach an agreement around medical coverage is causing teachers to look elsewhere for jobs.

“We saw 86 certified staff members leave our school district last year. That harms our student learning even more,” Brighton said. “The uncertainty of healthcare -- and the affordability of it moving forward -- has more and more teachers thinking about leaving this district."

"They're ready to stand up and say 'Enough is enough. We need affordable healthcare now,'" Brighton continued. “We don't want to wait another week, or two, or three ... We want to have a resolution so we can continue focusing on educating children."

Erkeneff emphasized the crucial role that teachers play in the lives of students and communities on the Kenai Peninsula, and how important it is to the district to reach an agreement.

"That's a number-one priority, to continue working together to find a solution and reach a tentative agreement and end this strike -- or prevent it from happening," Erkeneff said.

KPBSD negotiation and finance teams are working on a counter-proposal in hopes of ending the dispute before the school board’s executive session Monday evening. Ultimately, it's the board that will ratify any kind of tentative agreement.

If the strike does happen, Erkeneff says the district will provide families with daily updates on the progress of negotiations.

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