Tag: United Federation of Teachers

NYSUT’s $544 Million Financial Problem

Over the past few months, New York State United Teachers got a lot of flack over the fact that its now-former Secretary-Treasurer, Martin Messner, was still teaching in the classroom…

Over the past few months, New York State United Teachers got a lot of flack over the fact that its now-former Secretary-Treasurer, Martin Messner, was still teaching in the classroom even as he also oversaw its woeful finances. Of course in reality, Messner had spent most of his three-year tenure as the union’s financial overlord at its headquarters in the Albany suburbs, and only began teaching again this past September after his leave-of-absence expired. [There’s also the presence of an actual staff of finance people who do the day-to-day work of balancing books.] But that brief period of double duty made for some laughs at the union’s expense.

The reality of the union’s financial condition, however, is not a laughing matter. As a Dropout Nation analysis of its latest filing with the U.S. Department of Labor shows, the union’s pension and retiree healthcare woes continue to keep it in virtual insolvency.

NYSUT reported that it accrued $544 million in pension and retiree health liabilities in 2016-2017, a 7.9 percent increase over levels in the previous year. While the union reported that pension liabilities decreased by 13.4 percent (from $288 million in 2015-2016 to $249 million in 2016-2017), retiree healthcare costs increased by 36.5 percent, from $215 million to $294 million within the same period.

As you would expect, NYSUT doesn’t have enough assets to cover those insolvencies. The union’s pension had $285 million in assets as of 2016, according to its filing with the U.S. Department of Labor. If you took that number, that still leaves $259 million in retiree pension and healthcare costs (along with other liabilities on the books), none of which would be fully covered by NYSUT’s $142 million in assets.

As with defined-benefit pensions run by states, districts, and the National Education Association (to which NYSUT is affiliated along with its status as the largest state unit of the American Federation of Teachers), NYSUT’s pension assumes an overly optimistic annual investment rate of return of 6.5 percent. Even in years in which those numbers can be made, NYSUT’s generous retirement age levels, under which an employee can head into retirement as young as age 55 with 10 years of service, adds additional strain onto finances.

The good news for NYSUT is that it is having greater success than other AFT and NEA affiliates in increasing rank-and-filers paying into its coffers. It added 35,381 rank-and-filers in 2016-2017, increasing its ranks by 5.4 percent to 686,975. This included a 7.2 percent increase in the number of classroom teachers and other school employees as well as a 2.6 percent increase in the number of retirees paying dues.

Former NYSUT Secretary-Treasurer Martin Messner got laughed at for both running the union’s finances while briefly teaching school. But the AFT affiliate’s woes are no laughing matter.

As a result of those increases, NYSUT generated $138 million in dues in 2016-2017, a 3.8 percent increase over the previous year. Overall revenue was $260 million, barely budging from last year. As you would expect, national AFT made sure to subsidize the affiliate; the $10.4 million it paid to NYSUT in 2016-2017 was 11.9 percent less than in the previous period. NEA provided $2.1 million last fiscal year, slightly less than in 2015-2016. NYSUT collected $1.8 million from its Teaching & Learning Trust, slightly more than in 2015-2016, while it garnered $6.6 million from its Member Benefits affiliate (which peddles annuities to the rank-and-file), a 5.7 percent decline.

The union did manage to hold the line on expenses. General overhead expenses of $6.4 million in 2016-2017 were three percent lower than in the previous period, while benefits costs of $43 million were just 1.4 percent higher than a year ago. As a result, NYSUT generated a surplus of $13 million, 8.5 percent lower than in 2015-2016.

Of course, NYSUT’s top honchos did fine for themselves. Andrew Pallotta, the ally of United Federation of Teachers President Michael Mulgrew who now runs NYSUT, collected $273,153 in 2016-2017, a 5.3 percent increase over the previous period. His predecessor (or, to be more-appropriate, former puppet) Karen Magee walked away with $346,080 in compensation, a 17.4 percent increase over 2015-2016. The aforementioned Messner was paid $285,684 in 2016-2017, an 11 percent increase over his compensation in the previous period. As for Executive Director Thomas Anapolis? He was paid $180,004, a 27 percent decrease over 2015-2016.

NYSUT has no interest in paying down its pension and retiree health liabilities. But it does have plenty of desire to buy influence. The union spent $97.4 million in 2016-2017 on on lobbying, contributions to like-minded groups and spending on almost-always political “representational activities”. That’s lower than the $99.6 it spent in the previous year.

The union gave $30,000 to Alliance for Quality Education, one of its longstanding vassals, in 2016-2017. That’s less than half what NYSUT doled out to the group in the previous year. NYSUT gave another of its dependents, Citizen Action of New York, even less; the $28,500 it gave to the group is 53.1 percent less than what was given in 2015-2016. The union doubled its giving to Education Law Center, handing over $100,000 in 2016-2017, while giving $250,000 to Strong Economy for All Coalition, unchanged from the previous period. NYSUT also made sure to give Labor-Religion Coalition of New York State $111,000 last fiscal year, an 11 percent increase over 2015-2016.

Advertising and messaging were the big spends for NYSUT. The union spent $296,315 with Visuality on social media efforts, dropped $21,950 on ads with Facebook, bought $5,152 worth of ads on Twitter, and put down $19,800 on ad space with Politico‘s Pro magazine to reach politicians and other players. The union spent another $84,565 on outdoor ads and public relations. Another $146,732 was spent on commercials with five outlets — public radio stations WAMC, WYNC and WXXI, as well as television stations WNYT and WWNY, which are dominate players in Upstate New York. NYSUT spent $39,150 with NGP Van, and dropped another $23,975 with Catalist, both key to the efforts of Democratic Party players.

Meanwhile NYSUT made sure to subsidize the UFT, the New York City local of AFT which effectively controls the state affiliate. NYSUT financed UFT to the tune of $14.5 million in 2016-2017, a 6.5 percent decrease from the previous period. UFT also owes NYSUT $10.8 million in accounts receivable, of which $4 million has been due for the past 90-t0-180 days. Too bad NYSUT isn’t doing much for the local in East Ramapo, whose district has been beset by a regime focused on damaging the futures of the kind of poor and minority children the union and its national parents claim to proclaim concern. The local there only received $17,240 in 2016-2017, less than the meager $17,732 it got in the previous period.

You can check out the data yourself by perusing the HTML version of the New York State AFT’s latest financial report, or by visiting the Department of Labor’s Web site.

Featured photo: Andrew Pallotta (left, with United Federation of Teachers player Shelvy Young-Abraham and AFT President Randi Weingarten), now runs NYSUT all on his own.

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AFT’s Bleak Future

As this morning’s Teachers Union Money Report shows, the American Federation of Teachers knows how to spend well. Especially on its leaders and staff. Whether or not it will be…

As this morning’s Teachers Union Money Report shows, the American Federation of Teachers knows how to spend well. Especially on its leaders and staff.

Whether or not it will be able to do so is a different story.

Some 236 staffers were paid six-figure sums in 2016-2017, according to the union’s latest disclosure to the U.S. Department of Labor. That is 14 more than in the previous fiscal year. That well-paid group includes Michelle Ringuette, the former Service Employees International Union staffer who is chief political aide to President Rhonda (Randi) Weingarten; she was paid $240,437 last fiscal year. Michael Powell, who is Weingarten’s mouthpiece, picked up $252,702 from the union.

Kombiz Lavasany, an AFT operative who oversees Weingarten’s money manager enemies’ list, earned $177,872 in 2016-2017. Kristor Cowan, who handles the union’s lobbying, collected $189,808 last fiscal year. Then there is Leo Casey, the vile propagandist who currently runs the union’s Albert Shanker Institute; he was paid $232,813 in 2016-2017 for doing, well, whatever Leo does these days that doesn’t include accusing reformers of committing “blood libel“.

Of course, the leaders are well-paid. Weingarten was paid $492,563 in 2016-2017, just a slight decrease over the previous year. She still remains among the nation’s top five percent of wage earners, and thus, an elite. Her number two, Mary Cathryn Ricker, was paid $337,434 last fiscal year (an 8.3 percent increase over the previous period), while Secretary-Treasurer Loretta Jonson was paid $392,530 in 2016-2017, a 9.6 percent increase over the past period. Altogether, AFT’s top three took home $1.2 million last fiscal year, virtually unchanged from the same time in 2015-2016.

The current occupant of the White House’s appointment of Neil Gorsuch to the U.S. Supreme Court dooms the financial and political future of AFT — and even has risks for some players in the school reform movement.

The additional salaries and bodies explain why AFT’s union administration costs increased by 17.8 percent (to $10.2 million) over 2015-2016, while general overhead costs increased by 14 percent (to $42 million). The union still managed to keep benefits costs from increasing. It spent just $10.4 million in 2016-2017, barely unchanged from the previous period; that can be credited in part to the fact that, unlike the districts its rank-and-file work in, AFT doesn’t provide defined-benefit pensions and only gives its workers defined-contribution plans that the union can avoid contributing to during times of financial stress.

It takes a lot of money to keep Weingarten and her team on board. Of course, they can thank compulsory dues laws that force even teachers who don’t want to be part of AFT. But those dollars are on the decline.

The union collected just $177 million in dues and agency fees in 2016-2017, a 7.9 percent decline from the previous year. This is despite the fact that the union’s full-time rank-and-file increased by 5.2 percent (to 710,865 from 675,902) over the previous period, reversing a three-year decline. One reason for the decline: A 12 percent decline in the number of one-quarter rank-and-file (to 81,191 from 93,047), a group that includes nurses and government employees represented by the AFT’s non-teachers’ union affiliates, and a 29.2 percent decrease in one-eighth rank-and-filers (to 24,180 from 34,104).

Another factor lies in the move last year by United Teachers Los Angeles to jointly affiliate with the National Education Association. That move contributed to a 23 percent increase in the number of AFT rank-and-filers in affiliates also tied to NEA and other rival national unions (to 158,225 from 128,221). With more states attempting to end compulsory dues laws, a possible U.S. Supreme Court law striking them down altogether, and a desire by state and local affiliates to wield more influence in education policy at all levels, expect more AFT affiliates (and even some NEA affiliates) to also align themselves with other national unions.

Overall, AFT generated revenue (including debt borrowings) of $332 million in 2016-2017, a 1.2 percent increase over the previous year. This included $88.2 million it borrowed during the year to shore up operations (of which $68 million was repaid by the end of the fiscal period); that’s 59 percent more than the amount the union borrowed in 2015-2016. Excluding the borrowing, AFT’s revenue for 2016-2017 was $244 million, virtually unchanged from the previous year.

But as today’s report notes, AFT faces trouble in the next year. If the U.S. Supreme Court strikes down compulsory dues laws as expected in Janus v. AFSCME, the union and its affiliates will lose big. The union has already seen its affiliate in Wisconsin attempt a merger with NEA’s Wisconsin Education Association Council after losing half of its rank-and-file since the state abolished its compulsory dues law six years ago. [The merger was aborted because of the difficulty of merging dues structures.]

While AFT’s presence in Democrat-dominated states could help it stem rank-and-file losses, the reality is that it will likely lose at least 25 percent of its membership. This means a likely loss of $44 million (based on 2016-2017’s dues collections), and less revenue that it can use for influence-buying, political campaign activities, and lobbying. Not even AFT’s stalled strategy of expanding its presence into nursing and healthcare would have offset those losses,  especially since the Supreme Court ruling will also apply to public employees working at hospitals and health centers.

Those possible revenue and influence losses is one reason why AFT, along with other NEA and other public-sector unions, spent so furiously last year to support Hillary Clinton’s presidential campaign. If she had one, it was likely that either she would get to appoint a Supreme Court justice more-amenable to their cause, or, given congressional Republican opposition to Obama’s efforts to select a replacement for Antonin Scalia, would have kept the court split equally between conservative and more-progressive justices.

But with Trump in the White House and his appointee to the high court, Neil Gorsuch, confirmed and in the job for life, AFT and its affiliates now needs a new strategy for actually attracting members. This will be difficult.

Because AFT hasn’t had to actually win bodies since the 1960s, it lacks the strong organizing infrastructure that has made SEIU a major force in both the public and private sectors. The fact that the union has seen a 15 percent year-to-year decline in associate members (who are members of the national union) means that there is also little appetite for its presence, especially since, unlike state and local affiliates, it doesn’t have the means to help associate members out when they have workplace disputes.

While the state affiliates are strong in lobbying legislatures, they, along with AFT National, play little role in addressing the day-to-day concerns of classroom teachers; that’s what locals such as UTLA, Chicago Teachers Union, and United Federation of Teachers in New York City do. That the big locals also tend to be major players at the state levels, dominate the operations of the affiliates, and, in the case, of UFT, virtually controls the virtually-insolvent state affiliate, means that they have little need for either the state operations or national. Even without a Supreme Court ruling, you can expect the local affiliates to develop new structures that bypass AFT and allow them to try new approaches to education policymaking and organizing.

Reformers can’t exactly celebrate, either. A dirty secret of centrist Democrat and civil rights-oriented reformers is that they are as dependent as AFT on compulsory dues. This is because AFT and other public sector unions are the biggest financiers of the Democratic National Committee operations (as well as those of state parties), and also give plenty to reform-minded groups for their activities outside of education. Center for American Progress, Leadership Council on Civil and Human Rights, and UNIDOS are among the reform-minded outfits who will also take a hit if the Janus ruling goes against AFT and its fellow public-sector unions.

You can imagine Weingarten and her staffers shudder at the prospect of a future without compulsory dues. What they will do to preserve traditionalist influence (and keep their jobs) will be fascinating to watch.

Dropout Nation will provide additional analysis of the AFT’s financial filing later this week. You can check out the data yourself by checking out the HTML and PDF versions of the AFT’s latest financial report, or by visiting the Department of Labor’s Web site. Also check out Dropout Nation‘s Teachers Union Money Report, for this and previous reports on AFT and NEA spending.

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Four Burning Questions in School Reform: It Starts with (Cathie) Black


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Just because it’s Thanksgiving week doesn’t mean there aren’t points to ponder: What is New York City Mayor Michael Bloomberg’s next step in getting support for making Cathleen Black chancellor…

Photo courtesy of Fallbrook Bonsall Village News

Just because it’s Thanksgiving week doesn’t mean there aren’t points to ponder:

  1. What is New York City Mayor Michael Bloomberg’s next step in getting support for making Cathleen Black chancellor of New York City’s schools? Based on what some speculate, some folks (namely New York State Education Commissioner David Steiner, Assembly Speaker Sheldon Silver and New York AFT boss Michael Mulgrew) want a more-education industry-versed person (essentially, a member of the educational status quo) to serve as Black’s co-pilot in overseeing the city’s Department of Education. Will Bloomberg play ball or pick one of outgoing Chancellor Joel Klein’s former deputies (notably Chris Cerf) and dare his opponents in a game of political chicken.
  2. Will incoming House Education and Labor Committee Chairman John Kline actually attempt an investigation (or show trial, depending on where one sits) of the Obama administration’s handling of federal stimulus funds — including Race to the Top money? Will he help back an effort by Utah’s Jason Chaffetz — who may take over one of the House subcommittees overseeing the District of Columbia — to revive the now-shuttered D.C. Opportunity voucher plan? The answer may be “no” to both.
  3. When will the National Education Association and American Federation of Teachers admit that defined-benefit pensions and other parts of traditional teacher compensation are no longer worth defending? That answer may come in the next few years as the pension deficits of their affiliates finally start hitting the bottom lines. Or they end up like the NEA’s Indiana affiliate and go bust altogether.
  4. Will Detroit and Indianapolis — home to two of the nation’s most-persistent dropout factories — be among the latest cities to have their districts be taken over by state education departments. Indiana’s education czar, Tony Bennett, has already fired his shot across the bow of Indianapolis Public Schools (which has  seven of 21 schools — including the notorious Manual High — under probation for five consecutive years) and other districts. Eduspiel speculated on what would happen to Detroit Public Schools earlier this year. Either way, both can’t end up like Philadelphia — whose five-year Promoting Power rate declined from 74 percent for the Class of 2001 to 64 percent for the Class of 2009 since Pennsylvania state officials took over the district nine years ago.

By the Way: The State of Black CT Alliance — which helped successfully push for the Nutmeg State’s Parent Trigger law — is hosting its first annual Building Blocks of Educational Excellence Campaign Dinner and Awards Ceremony. Congressman Chaka Fattah, Education Trust President Katie Haycock and yours truly will be speaking at the Dec. 16th event in Stamford, Conn., and will talk about to reform American public education and  Learn more (and buy your tickets) at the State of Black CT Alliance’s Web site.

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Watch: Michael Mulgrew on Technology in Education, Fixing Middle Schools and No Child Reauthorization


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Being Randi Weingarten’s successor as head of the American Federation of Teachers’ New York City local isn’t easy. But Michael Mulgrew has definitely earned the ire of charter school supporters,…

Being Randi Weingarten’s successor as head of the American Federation of Teachers’ New York City local isn’t easy. But Michael Mulgrew has definitely earned the ire of charter school supporters, school reformers and others for his strident opposition to lifting New York State’s restrictions on charter school growth. The role he and his counterpart at the state AFT affliate played in torpedoing the Empire State’s Race to the Top plans, in particular, came up during yesterday’s Alliance for Excellent Education pow-wow on New York City’s school reform efforts courtesy of a New York Post reporter; predictably, Mulgrew denied he had anything to do with it. Mulgrew also spent time dodging questions and comments about D.C. Public Schools Chancellor Michelle Rhee’s efforts, which he politely pointed out, had nothing to do with him or New York City.

Certainly, much of what Mulgrew is doing is mere posturing. The reality is that New York City taxpayers, long-tired of woeful public schools, are satisfied that schools chieftain Joel Klein and his boss, Mayor Michael Bloomberg, are on the right track. The growing pension burdens, along with the federal push for increasing charters and reforming the teaching profession, means that Mulgrew will eventually give in. If Klein can throw in another 43 percent increase in teachers salaries over time (as he did in the past decade), Mulgrew will cave in even more quickly.

At least one can say Mulgrew is thoughtful about the role of technology in education. In this clip, he says that testing and technology is as important in improving how teachers instruct their students as it is for holding schools (and teachers — though he won’t say this) accountable. He also briefly notes that middle schools must be as much a focus of the reauthorization of the No Child Left Behind Act as high school reform.


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Read: Monday Morning Quarterback Edition


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What the dropout nation is reading this Monday morning:after the NFL playoffs: John Fensterwald notes Gov. Arnold Schwarzenegger’s effort to revamp the state’s teacher seniority rules, which force districts to…

Photo courtesy of Jose Vilson

What the dropout nation is reading this Monday morning:after the NFL playoffs:

  1. John Fensterwald notes Gov. Arnold Schwarzenegger’s effort to revamp the state’s teacher seniority rules, which force districts to lay off their younger teachers first without regard to their performance. Fensterwald notes that if Schwarzenegger succeeds, districts will have to step up to the plate and conduct strong rigorous evaluations of teacher performance. Fensterwald also reports that some school districts are getting cold feet about Race to the Top participation.
  2. In the Daily News, Tom Carroll takes to task Randi Weingarten’s replacement as head of New York City’s AFT local. Sample quote: “Mulgrew’s point is not actually the advancement of any specific proposal, but rather to throw out there as much mischief as possible to gum up charter schools”.
  3. In Dropout Nation comments for Friday’s Read. Southern Education Foundation’s Steve Suitts, who co-wrote the recently-released A New Diverse Majority report, responds to Monise Seward’s criticisms of the study (and of education think tankers in general). He makes some important points about the study and its overall focus. I’m reading the report now for an upcoming Spectator report.
  4. Virginia’s Democratic House leader argues that support for charter schools shouldn’t be a “partisan” issue.
  5. School administrator Deron Durflinger offers a voucher-like kind of school reform: Give vouchers to parents, who can then directly select the teachers they want to teach their children. Intriguing idea. It could actually lead to greater parental engagement, improve student achievement and make teachers true professionals the way lawyers usually are.
  6. Alan Bonsteel of California Parents for Educational Choice offers historical perspective on school choice and the Golden State’s recent school reform efforts.
  7. Julia Steiny focuses on a union-sponsored charter school. A school not sponsored by either the NEA or AFT.
  8. Kevin Carey observes the financial havoc within California’s university system and takes shots at the University of California’s leaders and wealthy students for their “faux solidarity” with poor collegians.

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Read: Weekend Watch Edition


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What’s happening in the dropout nation: – The Foundry takes aim at the opposition among some D.C. politicos to reviving the soon-to-be-shuttered D.C. Opportunity Scholarship program. Harry Jaffe of the…

More opportunities to learn. Photo of St. Anthony Catholic School, Washington, DC

More opportunities to learn. Photo of St. Anthony Catholic School, Washington, DC

What’s happening in the dropout nation:

The Foundry takes aim at the opposition among some D.C. politicos to reviving the soon-to-be-shuttered D.C. Opportunity Scholarship program. Harry Jaffe of the Washington Examiner offered his own thoughts — and gave one of the District’s city councilmen the business earlier this week. Jaffe thinks vouchers “will get funded for another five-year program.”

– Meanwhile, in The Catholic World Report, I take a look at one of the key alternatives to D.C. Public Schools: The Archdiocese of Washington’s Catholic schools. Two years after Archbishop Donald Wuerhl decided to spin off several of its financially-lagging schools and convert them into charters, the proverbial Mother Church is working hard to ensure educational opportunities for its poorest families while fostering additional funding and support from the flock.

– One of the three School Reform Andys (Rotherham, in this case) and Education News Colorado take aim at the Denver school district’s decision to hire a counselor to help school board members with their marriage problems (among other personal issues). Why should the kids — half of whom are likely to never graduate — count for anything? Well, at least it isn’t all going into administrators’ salaries, as it seems to be happening in the case of Indianapolis Public Schools.

– Will the AFT embrace school reform? Based on its New York City affiliate’s response to Mayor Michael Bloomberg’s Race to the Top efforts, keep the money off the betting line.

– In California, Gov. Arnold Schwarzenegger prods the Democrat-controlled legislature to take further steps in competing for federal Race to the To funds. The president of the state’s AFT affiliate isn’t thrilled with any of it.

– In research: The Center on Education Policy surveys state government uses of federal stimulus funds for education. The conclusions are mixed.

– Joanne Jacobs takes a look at the Deloitte study on the disconnect between the expectations of high school from parents and children, and the expectations of those who teach the latter. My thoughts will come later.

– In Charleston, S.C., one school superintendent is lambasted for winning an award, one that doesn’t have to do with improving the education of the children in the district’s care.

More news coming the rest of the weekend. Meanwhile, follow Dropout Nation on Twitter for continuous news and updates.

– Parent Revolution’s Ben Austin offers his own reasons why California needs to reform public education and prepare for Race to the Top.

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