A MESSAGE FROM MT. HOOD COMMUNITY COLLEGE TO FACULTY, STUDENTS AND OTHER INTERESTED PARTIES
(November 9, 2010)
There has been much discussion around Campus about contract negotiations between Mt. Hood Community College (MHCC) and the full-time faculty association. During situations such as these, critical facts may get lost in the details. That’s why we want to take this moment to lay out a few simple facts so that all may be informed about the College’s package contract offer and the ongoing reality of the College’s financial situation.
There are pages and pages of exhibits – data and other information that we have shared with the faculty association. All of it is important because it informs us all, in a very transparent way, and will help members of the faculty association to thoughtfully and thoroughly evaluate options based on indisputable, data-driven facts.
The three most-talked about topics revolve around salary, health care benefits and retiree health care benefits. Please read the following for a few critical facts about each of these areas. For those who are interested, we have made additional information available on the College website at http://home.mhcc.edu/negotiation/main.htm.
- MHCC full-time faculty have the highest average pay among all 54 community colleges in Oregon, Washington and Idaho. (Source: National Education Association (NEA) data, April 2010)
- Compared nationally, MHCC pays faculty at approximately the 83rd percentile. (Source: NEA data, April 2010)
- Based on 2009-10 data, the base salary for full-time faculty at the top step is 8.2 percent above the average of the five comparator schools ($80,864 v. $74,735). The five Oregon community colleges most like MHCC are Chemeketa, Clackamas, Lane, Linn-Benton and Portland. They are nearest our size or location and therefore provide the best comparison for wages and benefits.
- The total compensation after taxes for full-time faculty at the top step with ODS Plan 3 family health care is 18.16 percent above the average of the five comparator schools ($84,172.67 v. $71,237.57), or 14.92 percent above the average, adjusted for differences in contracted service days ($84,172.67 v. $73,244.88).
Everyone wants to be number one in something. But being the highest paying institution – especially in the ongoing reality of the state and national economy in which we find ourselves, is a dangerous and unsustainable path for our institution. The plain truth is, while we strongly support above-average salaries for its excellent faculty, the College’s financial health suggest a Mt. Hood-level, not a Mt. Everest-level, is warranted at the top of the salary schedule. We must moderate salaries at the top and move closer to the market average. The College has proposed a fair and reasonable way to accomplish this while retaining above-average COLA (cost of living adjustment) for those full-time faculty in the lower levels of the salary schedule.
HEALTH CARE BENEFITS
- Currently, the College provides health insurance benefits in which full-time faculty contribute 83 percent less than employees at the five comparator colleges ($75 v. $459.89 for the same or comparable coverage).
- Full-time faculty currently pay a low, fixed amount for health insurance ($55, $65, or $75), regardless of the richness of the plan they choose. Because of this, there is no incentive to become an educated health care consumer and select the most cost-effective plan based upon one’s individual and family medical circumstances.
- The College carries 100 percent of the risk associated with escalating health care costs because the employee’s contribution is a fixed amount. At most of the comparator colleges, the faculty assumes all of the risk of escalating costs because the colleges' contributions are fixed.
- Overall, health insurance rates went up 17 percent. Most importantly, OEBB ODS Plan 3 rates went up 27.2 percent ($1,857.30 [10-11] v. $1,459.69 [09-10], family coverage), and Plan 3 is the plan in which 69 percent of full-time faculty were enrolled during 2009-10. (OEBB is Oregon Educators Benefit Board; ODS is Oregon Dental Service.)
According to NEA data published in April 2010, the College contributes more on average for full-time faculty benefits than any other community college in Oregon, Washington and Idaho. Again, being number one in this area is not a sustainable path for the College. The proposal is fair and equitable and calls for employees to contribute a designated percentage of the premium, rather than a fixed amount. Even with this adjustment, MHCC full-time faculty would pay about 29 percent less than their peers at comparator colleges for comparable medical, dental and vision care.
- MHCC retirees who have already retired are unaffected by the College’s proposal.
- Those who retire on or before Sept. 30, 2011, will receive $4,200 annually until they are eligible for Medicare to subsidize the costs of medical, dental and vision care for any of the health plans offered by the College. Currently, there is no College contribution toward dental or vision care.
- Those who retire on or after Oct. 1, 2011, will receive the benefits stated in the contract in effect at that time and benefits may change, up or down, as successor contracts go into effect.
In 2009-10, the College paid $226,028 in health care premiums, or an average of $9,417 per retired full-time faculty member. As we all know, health care costs nationally remain on a steep, upward trajectory with no relief in sight. Nationwide, the trend across all industries is to reduce retiree health benefits to affordable and sustainable levels.
MHCC FINANCIAL SITUATION
- The College is projecting a 2010-11 budget shortfall of more than $5 million.
- The College implemented a range of steps this past year to increase revenues, such as increasing tuition by $5 per credit and increasing course fees for high cost programs.
- No employees have been given COLA increases, and there are none budgeted for 2010-11.
Many factors have converged to make this a difficult time for the College, financially. The College decided that it would not further burden students with the $50 per term parking fee that had been planned for implementation in fall 2010. This is a $1.9 million loss of budgeted revenue. Further, health care expenses will be $250,000 higher than budgeted.
COMMITTED TO STUDENTS
A review of the data here and in the detailed exhibits online shows the College is currently paying the most for wages and health insurance, compared to the five community colleges similar to MHCC. The data also shows the College is facing extreme budget challenges and can no longer sustain those expenditures at the current level.
Simply put, if left unchecked, the College will not have enough money to cover all its expenses. We need permanent solutions to an ongoing imbalance in the cost to run this College compared to similar colleges nearby.
We have been transparent in laying out the highpoints here for MHCC employees, students, the public and other interested parties. We appreciate the work the faculty association has put forth to understand the economic challenges facing the College, and our shared commitment to help our students transform lives and control their destinies.