Teacher Supplemental Pay

In addition to the work of the commission during 1988 and 1989, it is well worth noting another major piece of legislation passed during the 1989 Session, relating to teacher compensation.  The issue of teacher pay has long been a part of the overall discussion concerning public school finance.  Public education, after all, is a labor-intensive operation.  The labor force is comprised of skilled, educated professionals.  It stands to reason that compensation would be an ongoing issue for those involved and those who care about the quality of instruction for children.

In 1989, the Nebraska State Education Association (NSEA) launched an extraordinary legislative initiative to increase pay for teachers.  The effort was in the works for some time prior to 1989, but the actual measure, LB 89, was introduced in the 1989 Session.  The chief sponsor was Senator Dan Lynch of Omaha, who designated LB 89 as his personal priority bill for the 1989 Session.¹  Cosponsors would eventually include Senators LaVon Crosby of Lincoln, Brad Ashford of Omaha, Jim McFarland of Lincoln, and Jerry Chizek of Omaha.²

As introduced, LB 89 proposed to appropriate $100 million in each of two consecutive years to help local schools establish a minimum salary of $18,000 for every teacher.³  The legislation also proposed to appropriate $50 million for direct property tax relief.⁴ The idea was to take some of the burden off the property taxpayer and bring about more reliance upon state government to fund public education, a theme that permeated through the work of the commission.

The public hearing for LB 89 was itself an extraordinary event.  On Tuesday, February 7, 1989, the Legislature's Education Committee convened a special hearing at the state fairgrounds in Lincoln where some 3,800 citizens, mostly teachers, gathered to participate in the proceedings.⁵ Senator Ron Withem, chair of the Education Committee, believed it was the largest hearing on a single bill in the history of the state.  Withem was himself a former public school teacher prior to pursuing a career in the Legislature.

Given the magnitude of the measure, LB 89 was certainly offered at the right time in Nebraska's history.  The state was expected to have as much as a $144 million surplus at the end of the fiscal year.⁶ The immediate problem, however, was that Governor Kay Orr did not include such lofty ideas as increasing teacher pay in her biennium budget proposal.  Any substantive addition to the budget proposal would require negotiation and compromise, something the teachers' labor organization was particularly good at doing.

On February 28, 1989, the Education Committee advanced the bill on a unanimous 5-0 vote, but not in the same condition as introduced.⁷  The revised version provided for a $40 million appropriation in 1989-90 and $75 million in 1990-91 with an emphasis on helping those teachers with salaries below $18,000 per year.  The property tax relief portion of the original bill was dropped from the committee amendments to LB 89 as advanced.⁸

In keeping with the extraordinary nature of the legislation, LB 89 would become one of the most contentiously debated bills of the 1989 Session.  On May 23, 1989 the Legislature gave final approval (on a 37-12 vote) to a dramatically reduced version of the original bill, but it was still a victory for the teachers of Nebraska.⁹  Governor Orr signed the bill into law on May 26, 1989.¹⁰

As passed and signed into law, LB 89 created the Help Education Lead to Prosperity (HELP) Act.¹¹  The purpose of the Act was to promote excellence in education through increased teacher salaries with the intent that public schools have the capacity to recruit new teachers and retain quality teachers through salary increases.¹²  The measure established a formula to determine the amount allocated to each school district, educational service unit, or state operated school on behalf of the teachers employed at each institution.  The process required public education entities to annually submit to the Department of Education the number of full-time teachers employed.¹³  Details concerning the actual disbursement of funds to individual teachers would be a matter of negotiation between the employer and employees of the public education entity.¹⁴

LB 89 and its accompanying appropriation ("A") bill, LB 89A, dedicated $20 million for the 1989-90 and 1990-91 fiscal years to carryout the purpose of the Act.¹⁵  This was a substantial decrease in the amount sought by proponents of the legislation, but it was still a victory for teachers in the sense that the Legislature officially recognized their underpayment.  LB 89 established an automatic sunset of the HELP Act on June 30, 1991, unless the Legislature acted to reestablish it.¹⁶ This meant that the NSEA and other interested parties would need to fight for reauthorization on a continual basis.

The Legislature would, in fact, periodically reestablish the HELP Act to provide supplemental pay to teachers, but the amount appropriated for such purpose would gradually decline over the years.  By 1996, the annual amount appropriated was about $7 million.¹⁷

Finally, in 1996, the NSEA proposed to use the annual appropriation, otherwise set aside for supplemental pay, to help cover the cost of benefit enhancements to the three state defined benefit retirement plans (including the School Employees Retirement System) along with the Omaha Public Schools Retirement Plan.  This idea would be accomplished under LB 700 (1996), which effectively repealed the Help Education Lead to Prosperity Act.¹⁸  From then on, the annual $7 million appropriation to the defined benefit retirement plans was referred to as the "old HELP" money.  Naturally, the problem created under this arrangement is that it requires the institutional memory of those involved to maintain it.  After all, the HELP Act itself had been repealed, yet an appropriation is made on behalf of the old law each year.  The Legislature is effectively honoring, knowingly or unknowingly, the spirit of the HELP Act.