Many opponents of Gov. Rick Snyder’s budget cuts are exaggerating by as many as five times what he is proposing to knock out of per-pupil public school funding. Politicians, Michigan Education Association union employees and local superintendents are factoring in costs to the per-pupil reductions that Snyder has nothing to do with, says Michael Van Beek, education policy director at the Mackinac Center for Public Policy.

Snyder is proposing a $300 per-pupil cut for 2011-12.

There is an additional $170 per-pupil cut that was already made last year, under the previous governor, but an infusion of federal dollars negated it, Van Beek said. Snyder extended that $170 per-pupil cut for 2011-12, but now without the federal bailout it will actually take effect.

Yet some opponents are citing cut figures as high as $1,700 per student.

In a letter to parents, Walled Lake Consolidated Schools Superintendent Kenneth Gutman said that Snyder’s cut was $470 per-pupil, and that it was just one of the budget challenges schools face.

Gutman said the “real math” showed that Walled Lake had taken a $1,069 per-pupil reduction.

“In fact the full impact of the Governor’s proposal is the largest single annual cut in the history of education in Michigan and will certainly negatively impact programs for our children,” Gutman’s letter read.

According to the Michigan Messenger, MEA spokesman Doug Pratt has claimed that Snyder’s budget proposal will cause per-pupil cuts between $700 and $1,700. Pratt didn’t respond to emails seeking comment regarding how he came up with his per-pupil cut estimates.

State Rep. Jim Ananich, D-Flint, claims that the cuts will be more than $700 if retirement costs are factored in.

Van Beek said school districts will have to increase their contribution to the Michigan Public School Employees Retirement System next year from 20.66 percent to 24.66 percent. He believes that the additional money schools will be paying to fund their own employees’ pensions is being unjustly tagged onto Snyder’s per-pupil reductions by some of the critics, even though increased retirement contribution rates are caused by decisions (and indecisions) made years or decades before the governor assumed office.

He also points out that school districts also should have been aware that the federal money that bailed them out of the $170 per-pupil cut last year was a one-time deal.

“Gov. Snyder didn’t create the unsustainable health benefits and defined-benefit pension program schools have to pay for, or the one-time federal cash injections of the past, so he shouldn’t be held responsible when labor costs go up and federal wells run dry,” Van Beek noted.

Probably without realizing it, most Michigan school districts indirectly subsidize businesses in this state by lavishing school employees and their spouses with exorbitant health insurance coverage.

Most school districts willingly cover their employees’ spouses, without any regard for whether or not these spouses can get health insurance coverage elsewhere, like from their own employer. If a school employee’s spouse works for a private business that offers health insurance but elects to enroll in the plan offered by a school district, taxpayer funds are being used by school districts to indirectly subsidize the payrolls of private businesses.

Spouses of school employees likely would choose the district plan since health insurance provided in schools is typically more extensive and expensive, but there are fewer out-of-pocket costs for school employees compared to insured private sector employees.

If school districts stopped this practice of automatically extending health care coverage to their employees’ spouses, they’d be able to save on health insurance costs. For school employees without children, this would mean saving the difference between the cost of a single plan premium and a two-person plan premium for each employee (two-person plan premiums are about twice the cost of single plan ones).

It should be noted that  for school districts that still use or had used health insurance provided through the teachers union-created Michigan Education Special Services Association (there were about 430 in 2010), this wouldn’t have made much of a difference. The most popular MESSA plans don’t differentiate between single, two-person or family plan premiums and charged the same rate per employee no matter how many dependents they had.

There are some school districts that do limit the eligibility of their employees’ spouses from taxpayer-funded health insurance. Midland Public Schools, for example, outlines in its union contract that spouses of teachers can only enroll in the district’s self-funded health insurance plan if that spouse is not offered health insurance coverage elsewhere. This is a sensible policy, and one that appears to have contributed to MPS spending less per pupil on teacher health insurance than all but 6 districts of a similar size.

Interestingly, this policy should have the support for the state’s largest teachers union, the Michigan Education Association, since they oppose corporate welfare and support increasing the cost of doing business in this state.

Michigan schools spend about $2 billion of taxpayer money on health insurance. Legislators are considering proposals to reduce this cost, like one that would require school employees pay the private sector average of 20 percent of their insurance premiums. This alone would save hundreds of millions. This proposal would also lead to fewer spouses of school employees enrolling in a district-provided insurance, but there would still be plenty of districts indirectly saving private payrolls since school health plans would still be more generous than the norm in the private sector.

That’s why it makes sense for districts to pursue the types of policies used in Midland for its teachers, as this will guarantee even larger savings for districts, regardless of how much employees contribute to the cost of their own health insurance premium.