By Ethan Forman
DANVERS — The Essex Aggie trustees agreed to shift $15,000 from an annuity into the superintendent's annual salary this year to protect his pension from a new pension-reform law.
Superintendent Roger Bourgeois said the change in his contract was also intended to help him pay for his child's college tuition.
The move, coupled with a 3 percent raise, boosted Bourgeois' base salary from $132,500 last year to nearly $152,000 this year, according to records obtained this week.
It did not cost Essex Agricultural and Technical High School any more than it had already agreed to pay him. Instead, the school's trustees allowed Bourgeois, 55, to roll the retirement annuity into his regular salary so it would count toward his pension. The school is no longer paying into that annuity.
The superintendent's total compensation this year, including his raise, life and disability insurance payments, and a $400-a-month travel/expense allowance, is $161,245.
Annuities are tax-deferred investments that school employees can pay into and then tap after they retire. Bourgeois said he had been paying 11 percent of that annuity toward his pension.
But under new state pension rules, his annuity would no longer count toward his pension after July 1, 2010, when his old contract ran out. Only salary, he said, would be pension-eligible.
The school's trustees were on board with the move.
"We moved one category to another for the purposes of his pension," said Malcolm Patterson, chairman of the Aggie trustees' negotiation subcommittee. "It was money we were already paying him."
Bourgeois is worth the money, Patterson said.
"I'm very impressed with Mr. Bourgeois' performance," Patterson said. "He is an outstanding leader and someone we are lucky to have."
The 2009 pension reform law redefined what could be counted as regular pay toward a pension, said Sean Neilon, assistant executive director of the Massachusetts Teachers Retirement System. Housing allowances and other indirect payments are no longer counted.
Part of the pension reform law "excluded annuities for folks," Neilon said.
A public employee's pension depends on a number of things, including age, years of services and the average of an employee's three highest consecutive earning years. The maximum pension is 80 percent of that.
Pensions are partially funded by taxpayers. Educators' retirements are paid for by their own contributions, the retirement system's investment earnings and contributions from the state. Of the $1.9 billion the retirement system paid out last year, $817 million came from taxpayers, Neilon has said.
Much of the state's contribution goes toward paying down the system's "unfunded liability," the difference between the system's assets and the amount required to fully fund it.
Michael Pellegrino, president of the Hathorne Federation of Teachers, No. 1269, Essex Aggie's teachers union, said he was at the trustees meeting when the board voted on Bourgeois' contract, and he had no problem with nixing the annuity.
"I think it means they just moved the benefit from one category to another," Pellegrino said.
Bourgeois said his total compensation also increased because insurance premiums increased when he reached age 55.
The superintendent is in his 28th year in vocational and technical education, having started out as a carpentry teacher at Shawsheen Valley Technical High before he moved into administration.
Bourgeois and Patterson said that under Bourgeois' leadership, the 482-student agricultural and technical high school in the Hathorne section of Danvers is improving. Essex Aggie ranks fourth in English and 10th in math out of 30 regional vocational schools across the state whose students earned "advanced" and "proficient" on the MCAS.
The school is getting set to merge with North Shore Technical High in Middleton and Peabody's vocational high school program, in a $133 million merger on Essex Aggie's campus.
Gloucester and other Cape Ann communities have all signed on to be part of the merged district. Gloucester, which also provides four of its own vocation programs at Gloucester High School, also currently sends students to both Essex Aggie and North Shore Tech.