News Story

Superintendent Makes False Claim About Her Salary, Benefits

Total compensation includes money taxpayers contribute for retirement and benefits

An Oakland County public school superintendent who makes $180,853 a year says it is misleading to say the $17,992 her district contributes for her health care and another $40,650 to cover her retirement costs are part of her total compensation.

And the Oakland Press claims many other superintendents agree with her.

Farmington Public Schools Superintendent Susan Zurvalec claimed the Mackinac Center for Public Policy was misleading the public by including retirement and health care insurance costs in her total compensation after the local newspaper reported it, citing a database provided by the free market think tank.

The Oakland Press did a story about the cost of superintendents and cited Zurvalec and her total compensation of $277,900. The superintendent said her total compensation was $212,275 without state-required contributions for insurance and retirement costs.

The Oakland Press reported that "like many superintendents, Zurvalec objects to the way total compensation is computed by the Mackinac Center."

"Any payments toward health insurance benefits and retirement payroll costs, mandated by the state, are not received as compensation," Zurvalec was quoted as saying in the story. "The Mackinac Center's continued practice of including retirement payroll costs and insurance as compensation received by superintendents is misleading the public."

The Mackinac Center's database breaks out separately the total compensation by salary, insurance and pension costs and does not include federal payroll taxes districts pay for their employees. 

"If they stopped paying for her health insurance and retirement benefits, I'd bet she would notice," said Audrey Spalding, education policy director at the Mackinac Center.

The U.S. Bureau of Labor Statistics also includes insurance and retirement costs when it releases its employee compensation reports, which are cited by national media. 

"Those benefits can add up to 30 percent of your total intake from a company," said Elizabeth Ashack, an economist for the Bureau of Labor and Statistics. "You have another 30 percent in benefits paid out to you where you don't see the cash but the company is paying for you."

What some superintendents are shrugging off are billions in expenses when it involves public school teachers in Michigan. Taxpayers paid $1.98 billion dollars for teacher insurance in 2010-11 and another $2.46 billion for contributions to state and local retirement, employer social security and worker compensation, according to the state's Center for Educational Performance and Information.

Additionally, the unfunded liabilities in the Michigan Public School Employees Retirement System have climbed to $24.3 billion.

Farmington Public Schools contribution to MPSERS not only covers the cost of Zurvalec's retirement health care and pension, but also an extra amount to try to cover that $24.3 billion liability, said James Hohman, assistant director of fiscal policy at the Mackinac Center.

Zurvalec didn't respond to a request for comment.


See also:

Public Pension System Totally Broken

Politicians Cannot Be Trusted To Properly Fund Pensions

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.