Fairfax faces choice: Raise taxes to fund teacher pensions, or tame local spending 

Fairfax County officials are about to run head-on into the same public sector pension funding crisis that is spreading across the entire country, as detailed by the Pew Center on the States' recent report about the "trillion-dollar funding gap."

The issue is being drawn with razor-sharpness in Fairfax in the choice now facing local school board officials: They can either ask the Fairfax County Board of Supervisors to raise taxes to fund lavish teacher pensions and other retirement benefits properly, or they can reduce current teacher and administrator salaries by eight percent and use the money saved instead.

The Fairfax County Taxpayers Association explained the choice and what led up to it in a recent email alert to its members:

"The FCTA asked why the school board is urging the supervisors to raise taxes by $81.9M although only $9M is needed to pay for next year's expected increase in student enrollment.

"The school superintendent acknowledged that the reason is the increased cost in employee benefits, especially pensions. According to the schools' proposed FY2011 budget, employee benefits costs are increasing by $98M, of which $71M is for pensions and another $15M is for retiree medical benefits.

"The school board has been less than straightforward with the community about this. During her opening remarks at the forum, school board chairman Kathy Smith talked about cuts to band and sports, and bigger class sizes, but never acknowledged that the cuts were being made to pay for increased benefits costs. School board members urged the audience to ask the supervisors to raise taxes. If taxes are not raised, then the board will cut band and sports and increase class size to make the pension payments.

"The problem is that while unionized county employees have pensions, most private-sector taxpayers do not. Is it fair to raise taxes to fully fund county pensions when taxpayers rely on 401Ks and those have lost value?

"FCTA president Arthur Purves offered a solution based on President Obama's recommendation that employees accept lower wages so coworkers would not lose their jobs. Mr. Purves pointed out that $98M is about eight percent of next year's projected salaries.

"If the school board cut salaries by eight percent, then they could fully fund the increased costs of employee benefits; pensions and retiree medical benefits would be preserved; there would be no layoffs; band and sports would not be cut; class size would not increase; and taxpayers, whose 401Ks have lost value, would not face higher taxes.

"In response, school board member Janie Strauss stated that the board is already considering salary cuts. While there is great reluctance to cut salaries, one citizen asked if teachers would prefer keeping their jobs or keeping their pay and benefits. The superintendent responded that teachers were "50-50".

"The FCTA urges citizens to ask their school board members and supervisors if they favor raising taxes to fully fund county union pensions when taxpayers themselves generally do not have pensions but have 401Ks that have lost value. Please forward responses to alerts@fcta.org so we can post them on www.fcta.org.

"The Fairfax County supervisors will decide on tax increases in mid-April."

Similar battles are erupting across the nation as a result of the success of public sector unions, especially those representing teachers and administrators, in gaining contracts that guarantee extraordinarily generous defined benefit retirement programs. The programs are typically so lavish that as the number of beneficiaries grow, the ability of local and state governments to pay for them without heavy tax increases disappears.

That in turn forces political crises, which are nowhere better illustrated than in California state government's continuing bankruptcy.  

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