NJ governor seeks cap on school leaders' salaries

By Angela Delli Santi
Associated Press Writer / July 15, 2010

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SPOTSWOOD, N.J.—New Jersey Gov. Chris Christie on Thursday proposed capping the salaries of top public school administrators and basing future raises on student achievement, a move he said was necessary to help districts lower costs and keep property tax increases in check.

Christie made the announcement at an elementary school in Spotswood, where the administrative staff accepted a pay freeze to help the district manage costs this year.

Christie's proposal, which the administration said can be accomplished without legislative approval, would mean salary cuts for 366 superintendents when their current contracts expire. The salaries of assistant superintendents and business administrators would also be capped. Top administrators would be eligible for merit bonuses of up to 15 percent of their salaries, but could not earn pension credits on the extra pay. Principals and teachers whose contracts are negotiated by their union, would not be effected.

"It's a new day for superintendent pay in New Jersey," Christie said. "I candidly believe this will be the trend across the country because everyone knows this is right to do. But people have been afraid to take the first step."

The proposal introduces a sliding pay scale for administrators based on the size of their district to replace what are now individually negotiated contracts. The scale starts at $120,000 for the superintendent of a K-8 district with fewer than 250 students and rises to $175,000 for the superintendent of a district with up to 10,000 students. Compensation for 16 superintendents who oversee more than 10,000 students, including Newark and Toms River, would be negotiated individually with the Education Department.

"There seemed to be no rationality between the size of the district and the compensation," said Education Commissioner Bret Schundler, who accompanied Christie to Spotswood. "There also seemed to be no rationality between the compensation and the actual performance of the district."

Christie's announcement came after a consultant recommended that New Jersey increase the amount it charges schools, towns and counties for employee health insurance by 6 to 12 percent.

The recommended rate increases far exceed the 2 percent cap on property tax increases that Christie signed into law this week. Health insurance is exempt from the cap because local school districts and towns don't control the cost of premiums.

Christie said the recommended rate increases, which are typically approved, highlight the need to enact health benefits changes by the end of the summer.

"You've got to change the way we're providing health benefits here in the state through the health benefits plan or else your going to make the cap much more difficult to comply with," he said. "In the short term, that's one of the reasons for the exception to the cap -- so that it doesn't cause massive layoffs."

Christie made the cap the centerpiece of a larger effort to tame the nation's highest property taxes, which average nearly $7,300 per household. The largest portion goes to fund public schools.

The New Jersey Association of School Administrators issued a statement opposing Thursday's proposal.

Richard Bozza, the association's executive director, said a statewide salary cap could encourage administrators to seek work outside New Jersey and create disincentives for aspiring public school leaders.

Christie dismissed concerns over any potential staff losses.

"Everyone's got to be part of the shared sacrifice," he said. "The parents who are paying the bills through their property taxes have sustained pay cuts, some have been laid off or their pay's been frozen, and yet their property taxes continue to go up, in part to pay for ever-increasing, at twice the rate of inflation, superintendent salaries."

Schundler said he will propose regulations to the Office of Administrative Law by Aug. 6 for publication in September. Three public hearings will be held in the fall, and the regulations could be in place in December for five years.

The administration estimates a $9.8 million yearly savings.

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