School board approves 3% pay increase for staff, health insurance decision to be made in May

Without discussion, the School District of Rhinelander Board of Education voted unanimously Monday, April 20 to enact a 3% overall compensation increase for district employees for the 2026-27 school year. The district’s employee relations committee unanimously approved the increase during its April 13 meeting.
For teachers on the salary schedule, the increase will come through step movement on the existing pay scale. The district is also adjusting the scale itself — removing the bottom step and adding to the top — which would place new teachers at a starting salary of approximately $49,300 and set the top of the scale with a master’s degree at $84,800.
For all other employees, the recommendation calls for a flat 3% increase. The committee was advised that the Consumer Price Index (CPI) currently sits at 2.6%.
District superintendent Eric Burke noted that the recommendation fits within the district’s projected budget, though some variables remain unsettled, including special education funding.
The vote to approve the salary recommendation was unanimous.

The employee relations committee also heard a presentation from Ken Zastrow, a consultant who has been working with the district on its self-insured health plan, who walked members through the district’s current claims performance and two potential renewal options.
The district’s current plan year is running at a 90% loss ratio, an improvement over the prior year’s 108%. The district has received $954,000 in stop-loss reimbursements and $231,000 in pharmacy rebates since moving to self-insured coverage — savings that would not have been available under a fully insured arrangement — resulting in a net positive position of approximately $393,000, he reported.
Despite that strong performance, the district’s actuary is recommending an 18% increase in premium equivalents for the coming year based on the last 18 months of claims data, which would push the district’s total health insurance spend from roughly $7.9 million to approximately $9.3 million — an increase of about $1.3 million.
The two renewal options presented to the committee both attempt to soften that impact:
Option One would renew the current plan design without changes, resulting in an estimated $1 million increase in employer spending.
Option Two would modestly raise the deductible on the district’s primary plan — Plan One — from $1,000 single/$2,000 family to $1,500 single/$3,000 family. That change carries an actuarial savings of roughly 3%, bringing the estimated employer cost increase to approximately $880,000.
The committee also discussed a potential increase in the employee premium contribution share, from the current 4.53% to 7%. The statewide average employee contribution is 10-12%, and the district’s contributions are below that benchmark even at 7%. Moving to a 7% employee share, combined with Option Two’s plan design change, would reduce the district’s estimated cost increase to around $800,000, Zastrow explained.
Under that combined scenario, a single employee on Plan One would see their monthly contribution rise from $52 to approximately $91, while family coverage would increase from $119 to around $208 per month — still below the statewide school district benchmark of $121 single and $300 family.
Committee members expressed support for a gradual approach, with one member noting the importance of avoiding benefit structures the district could not sustain long term, drawing a comparison to the elimination of post-retirement benefits in prior years.
It was also noted that the district runs the risk of losing employees to other districts if it does not continue to offer a competitive benefits package. On the other hand, it was also noted that special education funding remains a major question mark in terms of the full budget picture. Burke told the committee legislative leaders recently indicated districts may receive more money for special education in the next budget, a 42% reimbursement was mentioned, however there’s no guarantee that will actually come to pass. For years, school districts across the state have been asking the state legislature to allocate adequate funding for the special education services that each district is required to provide. Burke noted that every percentage point of special education reimbursement represents approximately $70,000 to the district.
Ultimately, the committee did not vote on either of the two options Zastrow outlined, choosing instead to send both proposals — along with the supporting financial data — to the full board for review in May. Members asked that Zastrow’s slides be included in the board packet and requested that adequate time be set aside on the May agenda for a full discussion.
A high-deductible plan paired with employer HSA contributions was also explored but set aside after modeling showed it would push total spending to approximately $10.35 million — a roughly 30% increase — making it unworkable within current budget constraints.