By: Tony Di Domizio

More than $25,000 in taxpayer money versus $0 in taxpayer money.

That is the estimated difference in costs between the Souderton Area School District and the Souderton Area Education Association during the current teacher strike.

Aside from the amounts spent on an outside public relations firm, the district is paying its school board attorney and lead negotiator Jeffrey Sultanik around $22,500 in a retainer fee. In addition, Sultanik said he charges $175 an hour, not including bargaining.

The bargaining price per hour, he said, is around $175.

He said he has been involved in bargaining talks since Aug. 25.

The $175 per hour charge, he said, is part of the flat retainer fee per year.

When asked how many hours he has charged thus far, Sultanik said there is no calculation for hours.

"There are no billings out for August," he said. "It won't be out until the end of the month."

Gary Smith, lead negotiator for the SAEA, is paid by dues from the teachers.

"I get a salary for the year and I'm assigned a cluster of associations and Souderton is one of mine," Smith said.

SAEA President Bill Lukridge said the education association pays dues to the PSEA. PSEA employees get paid from the dues collected by local education associations.

"We are paying out of our wallets," Lukridge said. "Not one tax dollar goes to pay for Gary Smith. Whether he shows up one day or no days, he is still paid as a general employee of PSEA and he is not paid extra."

"Sultanik," Lukridge said, "has negotiated for eight out of 11 school strikes. Does that surprise you? He's making himself a millionaire on the children's backs."

The SAEA wants very much to use the district's "excess funds" in its reserve fund to pay for a new teachers contract.

"We will not use up the whole reserve fund," Lukridge said. "If collected wealth is at the sixth level out of 22 levels, and the district collects taxes at the sixth level and spends money at the 22nd level, what does that say? Shouldn't they be spending at the same level as they are collecting?"

According to state law, the district must save up to 7 percent of its budget in the reserve fund, Lukridge said.

"There is over $17 million in the reserve, and the total reserves reported to the Pennsylvania Department of Education is in excess of $17 million," he said. "They would be required to keep $5 to $7 million."

Sultanik said the district has multiple funds that it has in place, which includes an undesignated and designated fund balance.

The question of the use of reserve funds is presumptious on the part of the union, he said.

"The reason for the fund balance relates to capital revenues of the district," Sultanik said. "If the roof goes bad, we need to have that money.

"It's our rainy day savings account," he said.

He said the fund balance must not exceed 8 percent of the total budget, but the district can have designated portions of the budget in excess of that.

"In my opinion, it is irrelevant to the negotiating process," he said.

Several phone messages left for Souderton Area Superintendent Charles Amuso and Brenda Jones Bray, director of business affairs, were not returned when seeking further information for this story, including information on the reserve funds and fees being paid to the outside public relations firm being used by the district during the strike. The public relations firm also did not return calls.

Sultanik said the aid ratio also is a factor, which is a figure based on the real estate market value, personal income and age ratio of the district. He said Souderton Area ranks sixth to the lowest in aid ratio in the county.

"The union wants to ignore it, but it's the most relevant issue," he said.

Sultanik added that Souderton Area falls short in the amount of commercial tax base, compared to its surrounding districts.

Futhermore, Sultanik said the state Department of Education has the district saving money by 2012 to fund the Public Schools Employee Retirement System.

He said because PSERS invested in Enron and Worldcom and the state Legislature increased costs by 25 percent, the amount of retiree compensation for teachers in the state fund became underfunded.

This, he said, results in paying a huge spike in the cost of funding retirement payments by 2012.

"There needs to be money in the fund so it wouldn't go to the taxpayers in 2012 with a huge increase in taxes," he said. "If we pay that money to the teachers now, there will be no money to pay at that point in time."

Lukridge said that spike in the PSERS has not happened yet and might not happen at all.

"They want to correct a problem down the road, but they anticipate something that doesn't exist yet," he said. "Is it possible it may happen? It may. Is it possible it won't? Yeah."

The district also claims the money in the reserve fund is needed to go toward the new high school that will open in 2009.

Lukridge said the district has already taken out a bond issue on the high school. Just like a mortgage on a house that a homeowner wants to pay off, the district wants to pay off the bond early.

Yet Lukridge said like any homeowner, paying off a mortgage early would be nice, but there are other bills to pay, like increased compensation for teachers.

"We are losing teachers who are looking elsewhere for higher-paying jobs for the same position in other schools," he said. "The district needs to recognize they are losing good people."

He said the education association's proposal to the district would not cause an increase in taxes.

"That's a fact," he said.

Sultanik said the real issue isn't the money the district has available to pay for each teacher, but rather what is a fair increase for teachers.

"It's about if the current demand of 8.2 percent a year on average for each of the next four years is an appropriate number to do that," he said. "There isn't a school district in the region that has gotten 8.2 percent a year increase in any contract."

Nationally, he said, 3.6 percent increase a year is the most common.

"The argument regarding how much money we have and how much money we are spending pales in comparison to the 8.2 percent increase," he said.

While Sultanik said the district's offer of a 2.5 percent increase each year for three years remains, Lukridge said that 2.5 percent is merely the total salary package increase.

"Two percent of $60,000 and 2 percent of $30,000 are two different numbers," Lukridge said. "If you are at a $37,000 range and you move up one step, your percentage will probably be different than someone making $60,000 and moving up one step."

He said the education association has to incur increment costs from one step to the next in the salary schedule, and those increments alone will eat up 2.5 percent.

"How will 2.5 percent ever get Souderton Area School District off the bottom?" Lukridge said. "That 2.5 number is one that continues to make the district on the bottom for the next three years. How can you keep a teacher at those levels?"

In order to go through the salary guide, he said a 5.5 percent increase would need to be added to the 2.5 percent just to be equal to everyone else.

"It shows you how low we are compared to other school districts," he said. "We have two sets of numbers and we need a compromise between those numbers. That's why we will negotiate that at the bargaining table. Their number of 2.5 will guarantee Souderton to be at the lowest."