Post-retirement employment contracts similar to ones signed by high school football coach Mark Drake the past several years aren't unusual in the Steamboat Springs School District or anywhere else in the state.
Legislation passed decades ago allows Colorado Public Employees Retirement Association-affiliated employees to be rehired by school districts and other municipal agencies while continuing to collect retirement pay. The law was proposed, in part, because of a fear that an influx of retirements would leave school districts suffering from lost experience and expertise, PERA spokeswoman Katie Kaufmanis said.
Under legislation revised in 1986, PERA-retired school district employees can work up to 110 days each calendar year while collecting their retirement pay and regular salary from their employer. The law stipulates that retirees can't work for any PERA-affiliated employer during the month following their effective date of retirement. But after the first month, employees can be rehired, earn the salary they made pre-retirement and collect their retirement pay.
After an employee reaches the 110-day limit, their retirement benefits are reduced by 5 percent each day they continue to work during a given calendar year. A reduction exceeding 100 percent of a monthly benefit will decrease future months' benefits.
The legislation is good for employees and school districts, said former Steamboat superintendent Cyndy Simms, who was the head of the district when it re-hired Ron Schnackenberg as its first employee under the post-retirement plan.
"There's a financial advantage to all," Simms said Wednesday. "It's a very good plan all the way around."
Employees who return to work after retiring get paid their regular salary and collect retirement benefits. Employers, such as the school district, retain quality teachers and administrators without having to contribute to those employees' PERA accounts.
The trade-off for teachers and administrators who chose to work post-retirement is that they waive their tenure rights, meaning a district can choose to let them go for any reason. The employment agreements with teachers working post-retirement usually are year to year or assignment to assignment, and there is no guarantee of continued employment.
"Once you work under a (post-retirement agreement), you're really an employee at-will; you have no guarantee of being brought back," Steamboat Springs Superintendent Donna Howell said.
There's a distinct advantage for the district under such an agreement, Simms said. The School Board wanted the option of being able to tell employees the time has come for them to step down, Simms said.
"There comes a point in everyone's career when they're not as effective as they were at one point," she said.
School Board President Paul Fisher said the board has refused post-retirement contract applications for some of its former employees. The district typically receives one or two new requests each year in addition to multiple requests from employees already working post retirement who wish to continue for another year, Fisher said.
Typically, a retired teacher who is rehired by the district only works for one more year, but some employees are brought back multiple years under the agreement, though they must re-apply to the district every year, Simms said.
"I think the intent was for just one year, but they have extended it for some individuals," Howell said of the agreements.
The Steamboat school district employs nine teachers and one administrator through post-retirement agreements, Howell said. Four of the 10 are full-time employees.
But the financial advantage school districts reap by not having to contribute to a post-retirement employee's PERA account could end if proposed changes by PERA's board of directors are taken to and approved by the General Assembly. The PERA board is looking at making school districts pay PERA contributions for employees hired under the post-retirement system, Kaufmanis said.