Albemarle County Public Schools is expecting to save more than $3.5 million from a two-month premium holiday for medical insurance benefits and a reduction of premiums starting March 1.
However, the impact of the savings could be negated by a loss of $1.9 million in expected funding from the state.
County government and the school division offer self-funded medical insurance plans administered by Anthem of Virginia. The county covers most of premium costs, while participating employees have their contributions deducted from monthly paychecks.
Following many months of lower-than-budgeted utilization of health benefits, senior administrative staff for the county and the school division approved a premium holiday for December and January. Both the division and its employees were beneficiaries of the holiday.
“We had two or three years of not-so-great experiences in our self-insured pool,” said Jackson Zimmermann, finance director for the county schools, during Thursday’s School Board meeting. “We are returning back to what we believe is the true normal.”
Employees paying for family coverage through Albemarle’s traditional medical insurance plan saved $698 from the premium holiday, while those paying for a high-deductible family plan saved $188.
Dean Tistadt, COO of Albemarle County Public Schools, said the county tries to help employees avoid incurring medical expenses by covering the cost of annual physical exams, colonoscopies and other preventative care.
“Employees are making good decisions [about their health] and we, as an employer, are doing good things to encourage those decisions,” Tistadt said.
He said the average age of employees participating in the insurance plan is slightly younger, compared with several years ago.
“Aging people, even those who are in pretty decent health, incur higher costs. There’s no question about that,” Tistadt said.
Both employer and employee premiums are slated to be reduced to last year’s levels, resulting in anticipated additional savings of $393,000.
Division staff identified $2.24 million in one-time expenses that could be covered by the savings from the “extraordinary” premium holiday.
“Senior leadership sat down and affirmed that we should use one-time money for one-time [expenses],” Tistadt said. “We talked about things we would prioritize as urgent things for us to do.”
However, staff had to revise the list this week when it became apparent that budget bills in the state Senate and House of Delegates cut $1.9 million in funding for Albemarle that originally was included in Gov. Ralph Northam’s proposed budget.
The supplementary funding would partially offset the impact of Albemarle’s local composite index recalculation. The local composite index is used by the Virginia Department of Education to calculate the state’s share of projected school division payments for the governor’s budget.
Factors used to calculate the index include a locality’s true property values, adjusted gross income, taxable retail sales, population and the average daily membership of its school system.
The 6 percent increase in Albemarle’s composite index was the largest of any Virginia locality announced through 2020.
“We are [potentially] the largest loser of money for education funding in the entire state, by more than double,” Zimmermann said. “This is a big shift. We were not anticipating this.”
“The state outlook has worsened,” Tistadt said. “We are going to pull back on some of those items until we get a better picture of state revenues for next year,” Tistadt said.
Zimmermann presented a shortened list of expenditures, amounting to about $1 million, during the meeting.
Staff recommended using $425,000 to cover the cost leasing a facility and hiring a program administrator for the county’s pilot of a high school center for project-based learning, which is included in the budget for the upcoming fiscal year.
The largest item removed from the list was $600,000 for the first phase of renovations to the division’s central office, located on the third floor of the County Office Building on McIntire Road.
School Board member Stephen Koleszar recommended leaders of the county schools to contact Dels. David J. Toscano and R. Steven Landes to share their concerns about the funding cuts.
In response to a Feb. 14 shooting that killed 17 people at a Florida high school, Tistadt said he hoped the School Board would consider allocating $365,000 to provide classrooms with window shades and to coat windows with a protective film that strengthens their resistance to bullets.
“That would be a major deterrent for somebody trying to shoot people at a school,” Tistadt said.