January 22, 2013
1) NEA Dues Keeping the Lights On in Indiana. Teachers in Mississippi or New Mexico who are paying dues to the National Education Association should have a reasonable expectation that their money is paying for utilities and building maintenance at NEA headquarters in Washington, DC as well as the national union’s regional offices. But should they have an expectation that their dues money is doing the same for the Indiana State Teachers Association?
Back in 2009, the ISTA insurance trust collapsed under the weight of high-risk investments. Coupled with other financial difficulties, it drove the Indiana affiliate deep into the red, requiring the establishment of an NEA trusteeship. To bail out ISTA, NEA formed NEA Properties, Inc. (NEAPI) to purchase the real estate and buildings owned by ISTA. Since then, ISTA has been leasing space in its own buildings, paying NEA $1.5 million in rent in the 2010-11 fiscal year.
This seemed to be an adequate solution to ISTA’s problems, but it failed to account for the union’s continued budget shortfalls due to large losses in membership. ISTA ran a $4.2 million deficit in 2010-11 and was a cumulative $12.6 million in the red at the time. We can safely assume things haven’t improved.
Even more distressing for NEA is the news that NEAPI is losing money as well, reporting a $111,000 deficit in 2010-11. An examination of NEA’s financial disclosure report shows where some of the money has been going:
Electricity – $205,609
Property management – $198,752
Security – $96,316
Building repair and remodeling – $83,536
Custodial services – $74,008
Plumbing/HVAC repair – $47,671
Legal – $45,754
Monthly steam supply – $39,364
Maintenance – $36,100
Water – $30,814
Accounting – $27,908
Property taxes – $25,060
Concierge services – $22,961
Sprinkler repair – $17,655
Unspecified building supplies – $11,915
Pest control – $9,305
Door/glass repair – $8,437
Hygiene supplies – $7,892
Window cleaning – $6,975
Space planner – $6,458
These items alone total over $1 million, and when coupled with insurance costs and depreciation, leave NEAPI at a loss.
The Indiana problem would be relatively small potatoes if all was well elsewhere. But if ISTA is still wholly dependent on its NEA bailout after almost four years, what does that portend for staggering state affiliates in Wisconsin, South Carolina, Michigan and a lot of other places? Will NEA use national dues to pay for exterminators in Texas, janitors in New Jersey and handymen in Iowa? Can it even afford to?
2) Last Week’s Intercepts. EIA’s blog, Intercepts, covered these topics from January 15-22:
* RIP CQE. Communities for Quality Education goes unfunded.
* More Than You’ll Ever Need to Know About Lily Eskelsen. Accession announcement.
* Class Size Reduction the Natural Way. Demographics and destiny.
* Wisconsin Victory Only Leads to Next Battlefield. Keep your head.
* Silver Lining in NYC. No deal better than toothless deal.
* Union of 1% Same as Those of Other 99%. Congolese airlines and Chinese soul food.
3) Quote of the Week. “America’s educational system contains enough empty platitudes and kitten posters. It’s time to fill our students with some real content, create some connections, and see what sticks.” – Jessica Lahey, English and Latin teacher at the Crossroads Academy in New Hampshire. (January 16 Coming of Age in the Middle)