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Performance Compensation

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Communicating the timeline for moving to a performance based compensation system.

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Page 1: Performance Compensation
Page 2: Performance Compensation

Developing Talent • Enhancing Careers • Improving Student Learning

Performance CompensationGoverning Board Symposium

August 25, 2012

Rewarding Excellence Rewarding Excellence in Instruction and in Instruction and

LeadershipLeadership

Presenter:Jeff Powell, M.B.A.

REIL Financial/Business Systems Specialist

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Developing Talent • Enhancing Careers • Improving Student Learning

Outcomes for today’s Outcomes for today’s presentationpresentation

By the end of this presentation, you will be able to:

•Communicate legislative and REIL timeline for moving to a performance-based compensation (PBC) system•Describe REIL and District expectations for investing in PBC•Identify increased revenues available in FY13 for PBC through Classroom Site Fund and other funding sources•Identify strategies for ensuring district investment in FY14, FY15, and beyond

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Developing Talent • Enhancing Careers • Improving Student Learning

Why is a PBC system Why is a PBC system important?important?

The state of Arizona has made a commitment to ensuring that all students benefit from effective instruction, year after year, in every grade, in every course, in every school, and in every area across the state.

REIL’s performance-based compensation (PBC) system and career paths reward the greatest contributors, promote differentiated roles, and attract top talent to challenging schools.The REIL PBC system will allow REIL School Districts to recruit, retain, and reward high performing educators.

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Strategic Funding Transition Strategic Funding Transition PlanPlan

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Classroom Site Fund (Prop. Classroom Site Fund (Prop. 301): 301):

3 Funds3 Funds• Fund 011 – CSF Teacher Base Salary

• Fund 012 – CSF Performance Pay

• Fund 013 – CSF Other Instruction (Function 1000) Uses

Accounts for 20% of CSF revenues

Accounts for 40% of CSF revenues

Accounts for 40% of CSF revenues

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Legislative Timeline – HB2823Legislative Timeline – HB2823

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Legislative Timeline – HB2823Legislative Timeline – HB2823

Four performance classifications: Highly Effective, Effective, Developing, and Ineffective

The REIL Score:100-500, corresponding to the four performance

classifications

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Developing Talent • Enhancing Careers • Improving Student Learning

Legislative Timeline – HB2823Legislative Timeline – HB2823

Classroom Site Fund (Prop. 301): Individual teacher performance, as measured by the teacher’s performance classification (e.g., highly effective) must be a component of Fund 012 performance pay-outs

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Legislative Timeline – HB2823Legislative Timeline – HB2823

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Legislative Timeline – HB2823Legislative Timeline – HB2823Implementing the REIL performance-based compensation system allows a district to adhere to 15-977 by including:

School performance (e.g., school growth)

Individual teacher performance as measured by the teacher’s performance classification (e.g., individual growth)

Measures of academic progress (MAP) toward the academic standards adopted by the State Board of Education (SBE) (e.g., AIMS and SAT-10 scores)

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Legislative Timeline – HB2823Legislative Timeline – HB2823Implementing the REIL performance-based compensation system allows a district to adhere to 15-977 by including:

(Continued…)

Other measures of academic progress (e.g., team growth)

Regular evaluation for effectiveness (e.g., LOI)

A PBC system that includes teacher PD programs aligned with the elements of the PBC system (e.g., REIL PD)

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Strategic Funding Transition Strategic Funding Transition PlanPlan

Fiscal Year Per Weighted Student Count*2010-2011 $1202011-2012 $1252012-2013 $2202013-2014 $2502014-2015 $2802015-2016 $3002016-2017 $3202017-2018 $3502018-2019 $3702019-2020 $390

Classroom Site Fund Projected Revenues

Source: Chuck Essigs, Director of Governmental Relations, Arizona

Association of School Business Offi cials

*All funds (011, 012, 013)

The JLBC’s projected CSF allocation for FY13 is $227 per weighted

student count, approximately 3% higher than this forecast.

The FY13 projected CSF allocation is $107 more per weighted student

count than the FY12 CSF allocation.

The CSF allocation per weighted student count is forecasted to

increase at a rate of approximately 12.5% for the remaining years of the

REIL grant (FY13 to FY15).

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Strategic Funding Transition Strategic Funding Transition PlanPlan

Fiscal Year Per Weighted Student Count*2010-2011 $1202011-2012 $1252012-2013 $2202013-2014 $2502014-2015 $2802015-2016 $3002016-2017 $3202017-2018 $3502018-2019 $3702019-2020 $390

Classroom Site Fund Projected Revenues

Source: Chuck Essigs, Director of Governmental Relations, Arizona

Association of School Business Offi cials

*All funds (011, 012, 013)

This means a district’s FY13 Prop. 301 plan could remain

consistent with the per teacher dollar amount of FY12 CSF Fund 012 pay-

outs, while allowing a district to allocate the

increased revenues in Fund 012 to REIL PBC

investments.

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Strategic Funding Transition Strategic Funding Transition PlanPlan

This sample district has the opportunity to make FY13 Fund 012 CSF pay-outs in the amount of $768 per teacher, which is

consistent with the dollar amount of FY12 Fund 012 CSF pay-outs, while allowing the district to allocate the unexpended Fund

012 budget balance to REIL PBC investments.

FY Weighted Student Count

CSF Allocation per WSC

# of CSF Eligible

Teachers

Total Fund 012

Total Fund 013

012 per Teacher

013 per Teacher

FY12 8000 $120 500 $384,000 $384,000 $768 $768FY13 8000 $227 500 $726,400 $726,400 $1,453 $1,453

$342,400 $342,400 $685 $685

Classroom Site Fund Revenue FY12 / FY13 Comparison: Sample District

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Strategic Funding Transition Strategic Funding Transition PlanPlan

Assuming this district expended its entire FY12 Fund 013 CSF allocation on teacher pay-outs in the amount of $768 per teacher, for FY13, this district has the opportunity to be

consistent with the dollar amount of its FY12 Fund 013 CSF pay-outs, while allowing the district to allocate the unexpended Fund

013 budget balance to REIL PBC investments.

FY Weighted Student Count

CSF Allocation per WSC

# of CSF Eligible

Teachers

Total Fund 012

Total Fund 013

012 per Teacher

013 per Teacher

FY12 8000 $120 500 $384,000 $384,000 $768 $768FY13 8000 $227 500 $726,400 $726,400 $1,453 $1,453

$342,400 $342,400 $685 $685

Classroom Site Fund Revenue FY12 / FY13 Comparison: Sample District

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Strategic Funding Transition Strategic Funding Transition PlanPlan

Assuming this district did not expend its entire FY12 Fund 013 CSF allocation on teacher pay-outs, for FY13, this district has the

opportunity to allocate a more substantial unexpended Fund 013 budget balance to REIL PBC investments – in this fiscal year

or beyond.

FY Weighted Student Count

CSF Allocation per WSC

# of CSF Eligible

Teachers

Total Fund 012

Total Fund 013

012 per Teacher

013 per Teacher

FY12 8000 $120 500 $384,000 $384,000 $768 $768FY13 8000 $227 500 $726,400 $726,400 $1,453 $1,453

$342,400 $342,400 $685 $685

Classroom Site Fund Revenue FY12 / FY13 Comparison: Sample District

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REILREIL Performance Stipends Performance Stipends

During this school year – FY13 and Year 3 of the REIL grant – TIF funds will be used to make up to a $2,400 investment in

Teachers and Master Educators, while each REIL School District will make up to a $600 investment in Teachers and Master

Educators.

Component Group Grant Year Potential Annual AwardTIF District

Year 3 (FY13) $3,000 80% 20%Year 4 (FY14) $5,000 40% 60%Year 5 (FY15) $5,000 20% 80%Year 3 (FY13) $4,500 80% 20%Year 4 (FY14) $7,500 40% 60%Year 5 (FY15) $7,500 20% 80%Year 3 (FY13) $2,750 75% 25%Year 4 (FY14) $5,000 50% 50%Year 5 (FY15) $5,000 25% 75%

Funding for Performance-Based CompensationBudget Source

Individual, Team, & School Awards

Teachers (and Master Educators)

Hard-to-Staff Assignments (In-

Demand)

Principal

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Developing Talent • Enhancing Careers • Improving Student Learning

REILREIL Salary Augmentation Salary AugmentationComponent Group Grant Year Annual Salary Augmentation

TIF DistrictYear 3 (FY13) $5,000 100% 0%Year 4 (FY14) 100% 0%Year 5 (FY15) 50% 50%Year 3 (FY13) $5,000 80% 20%Year 4 (FY14) 40% 60%Year 5 (FY15) 20% 80%Year 3 (FY13) $10,000 75% 25%Year 4 (FY14) 50% 50%Year 5 (FY15) 25% 75%

Budget Source

Salary Augmentation

Master Educator

Turnaround Teacher

Turnaround Principal

Funding for Salary Augmentation

During this school year, TIF funds will be used to make a $5,000 investment in Master Educators by augmenting their base

salary. TIF funds will cover this investment in full.

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REILREIL Salary Augmentation Salary AugmentationComponent Group Grant Year Annual Salary Augmentation

TIF DistrictYear 3 (FY13) $5,000 100% 0%Year 4 (FY14) 100% 0%Year 5 (FY15) 50% 50%Year 3 (FY13) $5,000 80% 20%Year 4 (FY14) 40% 60%Year 5 (FY15) 20% 80%Year 3 (FY13) $10,000 75% 25%Year 4 (FY14) 50% 50%Year 5 (FY15) 25% 75%

Budget Source

Salary Augmentation

Master Educator

Turnaround Teacher

Turnaround Principal

Funding for Salary Augmentation

During this school year, TIF funds will be used to make a $4,000 investment in Turnaround Teachers by augmenting their base salary, while each participating REIL School District makes a

$1,000 investment in these teachers.

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REILREIL Salary Augmentation Salary AugmentationComponent Group Grant Year Annual Salary Augmentation

TIF DistrictYear 3 (FY13) $5,000 100% 0%Year 4 (FY14) 100% 0%Year 5 (FY15) 50% 50%Year 3 (FY13) $5,000 80% 20%Year 4 (FY14) 40% 60%Year 5 (FY15) 20% 80%Year 3 (FY13) $10,000 75% 25%Year 4 (FY14) 50% 50%Year 5 (FY15) 25% 75%

Budget Source

Salary Augmentation

Master Educator

Turnaround Teacher

Turnaround Principal

Funding for Salary Augmentation

During this school year, TIF funds will be used to make a $7,500 investment in Turnaround Principals by augmenting their base salary, while each participating REIL School District makes a

$2,500 investment in these principals.

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REILREIL Spotlight Schools Spotlight Schools

District Name School NameAlhambra ESD Cordova Middle School

Barcelona Middle School

Gila Bend USD Gila Bend Elementary and Jr. High / Gila Bend High School

Isaac ESD Butler Elementary School

Nadaburg USD Desert Oasis ElementaryNadaburg Elementary

Only REIL Spotlight Schools have Turnaround Principals and Turnaround

Teachers.

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Component Group Grant Year Potential Annual AwardTIF District

Year 3 (FY13) $3,000 80% 20%Year 4 (FY14) $5,000 40% 60%Year 5 (FY15) $5,000 20% 80%Year 3 (FY13) $4,500 80% 20%Year 4 (FY14) $7,500 40% 60%Year 5 (FY15) $7,500 20% 80%Year 3 (FY13) $2,750 75% 25%Year 4 (FY14) $5,000 50% 50%Year 5 (FY15) $5,000 25% 75%

Funding for Performance-Based CompensationBudget Source

Individual, Team, & School Awards

Teachers (and Master Educators)

Hard-to-Staff Assignments (In-

Demand)

Principal

Developing Talent • Enhancing Careers • Improving Student Learning

REILREIL PBC Timeline PBC Timeline

REIL’s strategic phase-in and phase-out plan includes a gradual shift of reliance upon grant funds to reliance upon district funds

to ensure sustainability beyond the grant period.

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REILREIL PBC Timeline PBC Timeline

REIL’s phase-in and phase-out plan allows districts to strategically repurpose and reallocate current and future

funding sources – most notably Classroom Site Fund – to ensure the sustainability of the REIL performance-based compensation

system.

Component Group Grant Year Potential Annual AwardTIF District

Year 3 (FY13) $3,000 80% 20%Year 4 (FY14) $5,000 40% 60%Year 5 (FY15) $5,000 20% 80%Year 3 (FY13) $4,500 80% 20%Year 4 (FY14) $7,500 40% 60%Year 5 (FY15) $7,500 20% 80%Year 3 (FY13) $2,750 75% 25%Year 4 (FY14) $5,000 50% 50%Year 5 (FY15) $5,000 25% 75%

Funding for Performance-Based CompensationBudget Source

Individual, Team, & School Awards

Teachers (and Master Educators)

Hard-to-Staff Assignments (In-

Demand)

Principal

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Strategic Funding Transition Strategic Funding Transition PlanPlan

The other existing funding possibility is the Instructional Improvement Fund (also known as Fund 020 and/or Indian

Gaming).

FY Alhambra Isaac Nadaburg Gila Bend TollesonFY10 $600,000 $351,000 $132,000 $0 $165,000FY11 $600,000 $351,000 $125,000 $0 $185,000FY12 $600,000 $340,000 $95,000 $0 $339,553FY13 $600,000 $365,000 $95,000 $23,051 $280,168

Instructional Improvement Fund Revenues FY10 - FY13

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Strategic Funding Transition Strategic Funding Transition PlanPlan

An opportunity exists for REIL School Districts to repurpose and reallocate Instructional Improvement Fund revenues to support

the investment in REIL performance-based compensation.

Allocations Alhambra Isaac Nadaburg Gila Bend TollesonTeacher Compensation Increases $180,000 $185,000 $50,000 $0 $0Class Size Reductions $0 $0 $0 $0 $140,084Dropout Prevention Programs $0 $0 $0 $23,051 $0Instructional Improvement Programs $420,000 $180,000 $45,000 $0 $140,084Total Instructional Improvement Fund $600,000 $365,000 $95,000 $23,051 $280,168

Instructional Improvement Fund Budgeting FY13

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Strategic Funding Transition Strategic Funding Transition PlanPlan

Component Group Grant Year Annual Salary AugmentationTIF District

Year 3 (FY13) $5,000 100% 0%Year 4 (FY14) 100% 0%Year 5 (FY15) 50% 50%Year 3 (FY13) $5,000 80% 20%Year 4 (FY14) 40% 60%Year 5 (FY15) 20% 80%Year 3 (FY13) $10,000 75% 25%Year 4 (FY14) 50% 50%Year 5 (FY15) 25% 75%

Budget Source

Salary Augmentation

Master Educator

Turnaround Teacher

Turnaround Principal

Funding for Salary Augmentation

Federal Title I and II monies will also allow REIL School Districts to provide financial support for the implementation and sustainability of REIL performance-based compensation.

For example, Title I and II monies can be invested in REIL salary augmentation.

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Ensuring Ensuring REILREIL PBC PBC sustainabilitysustainability

There are many opportunities for REIL School Districts to strategically utilize revenues in a manner that ensures the sustainability of REIL performance-based compensation by:

Allocating FY13 CSF Fund 012 and 013 dollars so as to fund teacher performance pay-outs at FY12 levels, which will allow for the unexpended budget balance to either

a) fund FY13 REIL PBC investments

b) be held in escrow to fund future REIL PBC investments.

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Ensuring Ensuring REILREIL PBC PBC sustainabilitysustainability

There are many opportunities for REIL School Districts to strategically utilize revenues in a manner that ensures the sustainability of REIL performance-based compensation by:

Allocating FY13 CSF (Fund 013) dollars so that a more substantial portion remains unexpended, making it available to fund REIL PBC investments in future years.

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Ensuring Ensuring REILREIL PBC PBC sustainabilitysustainability

There are many opportunities for REIL School Districts to strategically utilize revenues in a manner that ensures the sustainability of REIL performance-based compensation by:

Allocating Instructional Improvement Fund (Fund 020 and/or Indian Gaming) dollars so that a more substantial portion

a) is budgeted to fund teacher compensation increases in any given fiscal year

b) remains unexpended, making it available to fund REIL PBC investments in future years.

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Ensuring Ensuring REILREIL PBC PBC sustainabilitysustainability

There are many opportunities for REIL School Districts to strategically utilize revenues in a manner that ensures the sustainability of REIL performance-based compensation by:

Allocating Federal Title I and Title II monies to provide financial support for the implementation and sustainability of REIL performance-based compensation (e.g., salary augmentation).

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Ensuring Ensuring REILREIL PBC PBC sustainabilitysustainability

There are also opportunities for the REIL Alliance Membership of Stakeholders to pursue a rigorous legislative agenda.

Change TEI to Teacher Effectiveness Index

Select components of this legislative agenda might include:

Indefinite, but restricted M&O carryforward for special PBC line item

Small District Adjustment for PBC

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Moving Forward from HereMoving Forward from HereFirst, an electronic copy of this presentation will be made available to all REIL School Districts.

Second, the REIL Cross-District Finance Team will resume regularly scheduled meetings in September.

Third, please feel free to be in touch with me, as I will be happy to offer any support that I can to REIL School Districts throughout the continued implementation of the REIL PBC system.Lastly, thank you for being here today; and thank you for supporting the REIL initiative.

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Moving Forward from HereMoving Forward from Here

Contact Information:

Jeff PowellREIL Financial/Business Systems Specialist

[email protected]: (602) 506-0307Mobile: (602) 499-6604

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