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Thursday, September 8, 2011 - 10:56am

Schools' $80M Healthcare Burden

Updated: 3 years ago.
Schools may have to come up with a hundred million dollars to pay for the rising cost of health insurance for bus drivers and lunchroom workers next year.(photo by Caitlin Regan via flickr)

The state Department of Education Thursday sent its two percent budget cut recommendations to the governor.

The plan covers the rest of this fiscal year and next fiscal year.

It slices $6.3 million mainly from nutrition, agricultural education and transportation programs.

But the agency’s CFO Scott Austenson says the real financial challenge is not in the state budget. It’s the $80 million increase for bus drivers and lunchroom workers’ health insurance. The state stopped subsidizing it this year.

Austenson says it gets worse next year.

"We have been told at this point the Department of Community Health is anticipating about another $150 per month per employee increase,"says Austenson, "and if that happens that would be about $130 million of increased cost in fiscal year 2013 for school systems for bus drivers and lunchroom workers."

Health insurance rates have risen for all state employees. It’s a result of increased health care costs and fewer people on the workforce to pay for the benefits of retirees as well.

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