HAYWARD — The key component to why teachers may strike over failed contract negotiations is how the two sides view the district's general funds.

About $17 million is stashed away in Hayward Unified's piggy bank, according to the district's latest budget. Teachrs see this pot of money as a way to attain the same nearly 17 percent raise two assistant superintendents received last spring. The district, however, says the money can be used only as one-time funding.

"If it was ongoing funding, then we wouldn't have a problem meeting the teachers' request," said Assistant Superintendent Dr. Barry Schimmel.

But several mandated costs and a required 3 percent reserve will strip the general fund's true pad down to about

$8 million, according to the budget.

More money, fewer kids

Hayward schools received an 8.08 percent budget increase for this school year to bring their per-pupil funding up to the statewide average. The increase included the statewide cost of living adjustment.

Public school funding in the state is solely dependent on daily student attendance. This stream of money covers every district need, such as staff salaries, facility upgrades or repairs and supplies.

All things being equal, the statewide increase would have sent $9 million to the district. But an enrollment decline of about 1,100 Hayward students cut more than two-thirds of that potential new funding, leaving just $2.5 million, according to the district.


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Hayward Unified offered that money and then some — about $4 million total — to teachers in its original proposal of a 3 percent increase retroactive to last July.

Take it or leave it

Last week the district made its "final" offer to teachers of a 7 percent increase effective in May, with the potential to max out at 8.6 percent.

The jump from 3 to 7 percent was to be paid from the general fund, from program reductions, and from halting the practice of setting aside extra money to cover the rising cost of retiree benefits for two years.

Hayward Unified has been using the "pay as you go" method when funding retiree benefits, but also was allocating extra money to prepare for a large "bubble" of future retirees and inflated benefits.

Officials say these moves give the district enough money to fund the proposed salary increase until the end of next school year.

But to accommodate the higher payroll beyond that, the district would need to spend $3.5 million more than it brings in during the 2008-09 school year, and $6 million more than it brings in the following year.

Stepping up

Some of the money that could raise the district's offer from 7 percent to 8.6 percent would draw on savings from its so-called "step-column salary schedule," which matches a set salary to a teacher's years of service and degrees. Teacher salaries automatically increase by seniority, and by going back to school to earn more teacher credits.

The district has earmarked about $2 million annually to cover the cost of those increases, though the actual amount needed fluctuates from year to year.

Because about 40 percent of its teachers have topped out on the schedule, the district hasn't had to use the full amount set aside recently. It has agreed to allocate whatever's left over from the $2 million each year to fund an increase in pay for all teachers.

In addition, the district has introduced an early retirement incentive. Eligible teachers who take advantage would receive an extra $10,000. Money saved from the early retirements also would go toward the higher raise for teachers. About 60 teachers would have to enroll to bring the teachers' total raise up to 8.6 percent.

No thanks

The union rejected that offer and called it an "insult."

Teachers are currently under a three-year contract ending June 2008 that calls for mid-contract salary negotiations this school year.

They say the 7 percent increase would only be a 1.24 percent increase for this school year because it is nonretroactive and it wouldn't take effect until May.

Furthermore, teachers balk at the idea of having to retire so that other teachers can get a better raise.

"The district is encouraging experienced, veteran teachers to leave," said Kathy Crummey of the Hayward Education Association. "That can't be good for the community and the education students receive."

Boiling point

Teachers, who say they are paid less than their peers in comparable unified districts such as Pleasanton, Fremont and New Haven, consider the increase given to administrators a slap in the face.

The union last week budged from its demands of a raise equal to the superintendents', and is now seeking an 8.08 percent increase for this school year and a 4 percent increase next school year. The demand includes a cost of living adjustment and equates to 16.12 percent over two years.

Seeing red

To fund such an increase, the district says it would have to make $5.6 million in reductions next school year. Officials claim that by the 2008-09 school year, the district would be looking at a "state takeover."

There are no more scheduled bargaining sessions, but both sides are hopeful they can come back to the table and settle to avert a strike.

Union members have authorized but not announced a possible work stoppage. Teachers and supporters are planning a protest before the school board meeting at 5:30 p.m. Wednesday, in front of City Hall.

Kristofer Noceda can be reached at (510) 293-2479 or knoceda@dailyreviewonline.com.