Districts Like San Diego Are Offering Teachers Early Retirement; Are Students Collateral Damage?

California school districts at risk of falling off the fiscal cliff are increasingly turning to early retirement incentives as a humane way to balance their budgets, but students could be the ones who lose.

Many California school districts are facing large budget deficits brought on by continuing declining student enrollment and lower cost-of-living increases in state funding, said Michael Fine, chief executive officer of the state’s Fiscal Crisis and Management Assistance Team. Districts also have expanded their staffing in recent years, using federal COVID-19 funding that has since gone away.

The state’s schools spend about 80% of their funding on staff salaries and benefits, according to the Public Policy Institute of California. This leaves districts to choose between unpopular options such as layoffs, school closures and early retirement incentives if budget cuts are needed.

Early retirements often leave school districts with more inexperienced and under-prepared teachers, which research has shown can have a negative impact on student performance, particularly in high-needs schools.

This school year, two of the state’s largest districts — San Diego Unified and San Francisco Unified — are offering to pay older, veteran teachers and staff to retire early. Santa Ana Unified and Paso Robles Joint Unified offered an early retirement incentive to their staff earlier this school year. 

“Part of the cost savings that come with a SERP (supplemental early retirement plan) is, because school districts have a step and column salary schedule, that you realize savings by having teachers that are higher on the salary schedule retire,” said Amy Baer, associate superintendent of human resources for San Francisco Unified School District. 

“They’re replaced with teachers who are lower on the salary schedule, so it would bring down the number of experienced teachers that you are going to have,” she said.

In hard-to-fill areas, such as special education, math, science and bilingual education, districts sometimes have to hire under-prepared teachers who have not completed teacher training to fill vacant jobs.

“We are concerned that the early retirement incentive could exacerbate the existing vacancies for special education we have continued to experience for the last five school years,” San Diego Education Association President Kyle Weinbergsaid.

The districts are not excluding teachers in hard-to-fill jobs from retirement incentives. 

“I think it would be difficult, if challenged legally, that you won’t honor a math credential, but you will honor an English credential (for the incentive),” Fine said.

Deficits Mean Staff Cuts

San Francisco Unified leaders, with the help of state-appointed advisers, are trying to reduce the district’s deficit by $113 million. District officials estimate it will have to cut 535 positions, with about 300 coming from early retirements, according to district officials.

To help meet that goal, San Francisco Unified is offering an early retirement incentive to all staff 55 or older who have more than five years of consecutive service. In return, the district will pay them the equivalent of 60% of their current salary, according to documents from Keenan & Associates, the company administering the plan. The deadline to apply for the supplemental early retirement plan is Friday. 

San Francisco Unified officials have indicated layoffs will still be needed to bridge the district’s budget deficit.

San Diego Unified offered an early retirement incentive earlier this school year as part of an effort to eliminate a $112 million projected deficit. The district had 965 employees, including 478 teachers, apply for the incentive — 27% more than expected by the Jan. 15 deadline. The district hasn’t announced how much they expect the retirements will save.

The supplemental early retirement plan was open to employees eligible to retire under the California State Teachers’ Retirement System (CalSTRS), or CalPERS, a public pension service for state workers, by June 30. The district is offering staff 70% of their pay, capped at $124,000 — the top step in the teacher salary schedule. The money will be put in an annuity and paid out over five years.

District officials at San Diego Unified also have not ruled out layoffs, but expect them to be minimal. 

“The higher number of people taking early retirement is another positive step toward our goal of delivering a balanced budget in June,” Fabi Bagula, San Diego Unified School District’s interim superintendent, said in a statement. “The increased number of retirees provides us an opportunity to work with site administrators to assess the way we have been doing things and reimagine our staffing approach to better serve our students and families.”

Santa Ana Unified offered teachers and other certificated members of the teachers union an early retirement incentive in October, in an effort to reduce a $180 million structural deficit. Although 160 teachers accepted the deal, the district still expects to lay off at least 100 more certificated employees before the end of the year, said Ron Hacker, associate superintendent and chief business official.

The school board recently voted to reopen the window for early retirement applications and to extend it until May, according to LAist.

More Under-Prepared Teachers

Schools in San Francisco and San Diego counties made some of the most requests for emergency-style teaching permits and waivers during the 2022-23 school year, according to California Commission on Teacher Credentialing data. 

Districts request emergency-style permits to allow teachers who have not completed testing, coursework and student teaching, to work on provisional intern permits, intern credentials and short-term staff permits when they can’t find enough credentialed teachers. Waivers and limited-assignment permits allow credentialed teachers to teach classes on subjects outside their credential.

San Diego County is among the top 10 counties to request intern credentials, short-term staff permits and limited assignment teaching permits in 2022-23, according to the CTC. San Diego Unified serves 114,000 students — just under a quarter of the students in San Diego County.

That year, San Diego Unified had 55 teachers working on intern credentials, 68 on short-term staffing permits, two on provisional intern permits, 98 on limited assignment permits and three on waivers, according to state data.

 The district, the second largest in the state, had 5,051 teachers in 2022-23, the most recent year state data is available.

San Francisco Unified, which serves 55,452 students, currently has 59 intern teachers and about 230 teachers on various other emergency-style permits, according to the district. 

The district, which serves all but about 1,000 students in San Francisco County, has 3,364 TK-12 teachers and 128 early childhood educators. The county was listed among the top 10 counties to request district intern credentials and waivers during the 2022-23 school year, according to commission data. 

Teacher Shortage Persists

At a Dec. 10 San Francisco Unified school board meeting, parents and community members complained about long-term substitute teachers teaching in classrooms where there is no credentialed teacher.

Parent Cheryl Thornton urged the board not to eliminate 500 positions, saying the district already is struggling with empty positions. “We should prioritize central office positions and look for extra funding,” she said.

Another parent complained that her autistic son, who attends James Lick Middle School, has substitutes instead of a regular teacher. “We need a teacher as soon as possible,” she said.

San Francisco Unified, like most districts, has a shortage of teachers in special education and other high-needs areas. District leaders say they don’t know yet whether losing veteran teachers in these subjects could result in more under-prepared teachers working on emergency-style permits.

“It’s really too soon to say what the impact would be next year, but we are committed to making sure that our students do continue to get rigorous and enriching programs in our schools,” said Laura Dudnick, spokeswoman for the district.

The San Diego Solution

In San Diego Unified, 57 special education teachers are taking the early retirement incentive, San Diego Education Association President Weinberg said. That means more classrooms being taught by long-term substitutes, he said.

Concern from the teachers union resulted in a program that will retrain district teachers to be special education teachers while they work in those positions next school year. In a deal bargained with the union, the district will pay all the costs associated with earning a special education credential, he said. 

The union will propose making this program a permanent part of its contract, and is working with unions in other large districts throughout the state to make similar agreements, Weinberg said.

“We are optimistic that this will become the template for how we address the staffing crisis around special education moving forward, and provide a path for educators within our unit who are in more precarious contracts like temporary contracts or who would be potentially laid off or who are visiting (long-term substitute) teachers to be able to get a special education credential and make the commitment to teach in one of these vital special education roles,” Weinberg said.

San Francisco is contracting with Keenan & Associates and San Diego with Pacific Life Insurance company to administer their early retirement programs. 

“I have never seen an early retirement that actually saves the money that the vendor tells you it’s going to save,” Fine said. 

Despite that, Fine supports the use of early retirement incentives.

“I think we have to treat people with absolute dignity, and layoffs just destroy morale,” Fine said. “And when morale is destroyed, instruction is destroyed. So, when the morale of our teachers in the classroom is low, instruction is not as good as it should be. And you can’t harm kids that way. So I guess it’s a fine balance.”

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