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Governor highlights school costs

Gov. John Kitzhaber

Gov. John Kitzhaber

In his State of the State speech today, Gov. John Kitzhaber laid out two numbers that should grab legislators’ attention: $10,000 and $30,000.

The first is the cost of educating a K-12 public school student for one year in Oregon. The second highlights the cost of inadequate education: It takes $30,000 per year to keep a person imprisoned in Oregon.

He used the comparison to make his case for changes to Oregon’s correctional system, promote his proposals to reduce Public Employees Retirement System (PERS) benefits, and explore creation of a new Coordinated Care Organization (CCO) health system for public employees.

Kitzhaber outlined plans to fund education in two ways: Reducing benefits for public employees, and limiting correctional costs by finding “alternative and effective ways to sanction non-violent offenders.”

Every dollar counts, as the governor said the costs of primary and secondary schooling were projected to increase more than $1,000 per student in the next biennium just to maintain the level of education we have today. He said $500 of that comes in increased Public Employees Retirement System (PERS) costs, with salaries and benefits accounting for another $430 per student.

“For this huge investment we will not see a reduction in average class size, we will not see the restoration of lost school days and we will not be adding back programs like the arts or vocational studies,” he said.

Kitzhaber did not elaborate on his budget proposal, which would restrict PERS retirees’ cost-of-living increases to apply only to the first $24,000 per year.

There was good news in that a $3.5 billion budget deficit in January 2011 is a balanced budget today, but Kitzhaber acknowledged the state still does not have the money to meet the 40-40-20 goals. He said a higher standard must be set today.

The governor also indicated support for health care changes that could affect public education employees.

He cited the creation of coordinated care organizations (CCOs), which Kitzhaber said will keep medical inflation in Medicaid at 3.4 percent starting in 2014, saving $100 million in 2013-15 and $200 million in 2015-17.

“If, for example, we could move public school teachers and state employees into the same kind of high-quality, low-cost care model being developed by our CCOs, the estimated 10-year state savings could be as high as $5 billion,” Kitzhaber said.

Kitzhaber delivered his speech on the opening day of Oregon’s 77th legislative session in Salem. The Oregon Legislature will meet through Wednesday for organizational days that will include swearing in newly elected officials and voting for presiding officers. The Legislature will officially return on Feb. 4 to proceed with the regular session.

Click here for the complete text of Kitzhaber’s State of the State address.

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