CPS looking at millions in savings with new benefit contracts
The Columbia Public Schools Finance Committee is recommending benefit contracts to the school board. The recommendations include contracts with UMR for medical insurance, Delta Dental for dental insurance and Express Scripts Inc. for pharmacy benefits.
This is the first time the district has explored the possibility of changing benefit contracts in more than a decade.
The district Benefits Committee already approved the proposals. Heather McArthur, chief financial officer for CPS, said the Benefits Committee includes employees of the district. McArthur said some of those committee members sat in on interviews with the potential contracters.
The three contracts were selected because of their low prices and quality. All three are national networks, meaning when an employee retires or an employee’s child goes to college in a different state, they can still find medical services that are covered.
According to an April meeting of the Benefits Committee, the following are the three-year expected savings by signing contracts with UMR, Delta Dental and Express Scripts Inc.:
UMR – $2,315,018 Delta Dental – $20,507 Express Scripts Inc. – $9,262,390
With these added savings, the Finance Committee is proposing a list of additions to the 2019-20 budget that include more money for salaries, new hires and various improvements including technology updates.
The unexpected savings are a relief to the Finance Committee, as in future years’ budgets, the district was anticipating a deficit due to building a new middle school.
Those worries, however, could be lessened even more. A majority of the CPS budget, 53 percent, is funded by property tax revenue.
ABC 17 News reported earlier this week that the Boone County assessor notified more than 40,000 property owners of increased assessed property values. Currently, CPS has a property tax rate of $6.1425. The school board will set next year’s rate in August, but McArthur said that rate is not expected to change as voters have not approved any changes.
With the CPS property tax rate likely to stay the same, higher assessed values are likely to increase the district’s revenue. The district previously projected a 3 percent increase in property tax revenue for the 2019-20 budget. However, the assessed values for some properties increased at a higher rate of 8 percent.
McArthur said that each half-percent increase of property tax revenue is about $500,000 more for the district’s revenue.
The committee has previously discussed asking voters in future years to raise the CPS property tax rate in order to accommodate enrollment growth.
In July, the district will find out how much its tax revenue will increase because of the recent assessment.
