Provo district outlines employee pay increases, insurance costs and remaining "grandfathered" retiree benefits

Provo School District staff told the board June 10 that this year’s negotiated contracts provide a mix of step increases and targeted percentage raises for employee groups, while the district is absorbing a larger share of growing insurance costs.

Deputy Superintendent Jason Cox summarized the broad terms of spring negotiations, saying districts provided step increases and group‑specific boosts. “All the employees get a level increase, which means that, you know, on the salary schedule, they'll move,” Cox said during the study session.

What the board heard - State money and negotiated supplements: the state legislature provided a per‑employee supplement that increases teacher and classified pay; classified employees received a $1,000 per‑FTE supplement; teachers received an across‑the‑board increase tied to state action and an additional $2,000 schedule adjustment that flows through steps. - Local adjustments: the district added percentage increases in bargaining groups (administrative/tech ~5%; classified schedule normalized with 2.5% steps). The board discussed longevity steps for long‑service teachers and principal/stipend increases for secondary administrators. - Insurance and retiree costs: staff said self‑insurance claim payments rose dramatically and will require an increased contribution to the self‑insurance fund. The district plans a $3 million transfer in the FY‑25 closeout to mitigate a proposed 30% rise in insurance claim costs. - Grandfathered retiree benefits: staff clarified legacy retiree insurance commitments are winding down; the district reported two fully grandfathered retiree participants remain and roughly 100 prorated grandfathered recipients (a stipend or partial benefit) still receive payments. The district has been funding a reserve for these obligations for many years.

Why it matters Salary and benefits are the largest recurring portion of the district budget. Board members pressed staff for clarity on the long‑term fiscal impact and whether the district could continue the negotiated increases without recurring local revenue. Staff said part of the FY‑26 package would be covered by proposed local levies and by drawing limited amounts from reserves.

Next steps Board members will consider approval of the contracts and related budget items at the June 24 business meeting; staff also noted ongoing conversations about policy details (for example, how legislative supplements would persist if state funding formulas change).