* IEA press release…
Lawmakers took action to help save the teaching profession and repealed the 3 percent salary threshold on teacher salaries and reinstated the 6 percent salary threshold. The change was attached to the budget implementation bill.
Illinois Education Association (IEA) President Kathi Griffin, along with members, delivered 55,000 petitions calling for the repeal to Gov. J.B. Pritzker’s office just last week. IEA members also have sent thousands of emails and made hundreds of phone calls to lawmakers urging them to repeal the 3.
“This shows that our members’ voices were heard loud and clear in Springfield. Educators from around the state stepped up to save our profession and protect our students,” IEA President Kathi Griffin said. “It’s amazing to see how powerful we can be when we are united. We have a strong collective voice and we will continue to use it to advocate for our students and public education.”
Last year, deep within the budget implementation bill, lawmakers passed a provision that limited bumps in salary to 3 percent for members of the Teachers’ Retirement System or State Universities Retirement System for those in the last 10 years of their career, unless the employer wanted to pick up the excess pension cost. The 3 percent was simply a cost shift putting the financial burden on local taxpayers and college students instead of the state. The threshold had been 6 percent prior to that.
This law unfairly penalized veteran educators and could have significantly reduced lifetime earnings for all teachers. Because educators can qualify for a pension after five years and can leave their school district at any time, school board attorneys had been arguing for a 3 percent limit on all salary increases across the entire length of an educator’s teaching contract, creating havoc in districts in the midst of negotiations.
“We want to thank our lawmakers for standing with our educators and doing the right thing for our students and public education,” Griffin said. “Restoring the 6 percent threshold means we are allowing districts to attract the best and brightest to their schools. Our students benefit when we value and fairly compensate our teachers.”
The 6 percent salary threshold is expected to take effect effect as soon as Gov. Pritzker signs the budget package. You can find more information about the push to repeal the 3 here.
The language deleting the 3 percent limit is on pages 351 and 352 of the Budget Implementation Act, which passed the House 97-17-1 and passed the Senate 52-6.
* Some heads are gonna explode. From last year when the 3 percent cap passed…
“Those 6 percent-plus salary increases cost local taxpayers more than $38 million over the past decade in payments to the Teachers’ Retirement System alone,” reported the conservative lobbying group Illinois Policy recently.
“That policy … means a career worker with an average salary of $73,000 will earn approximately $250,000 more during the course of her retirement” over what it would have been without the boost.
* Jim Dey last week…
Finally, the legislators, watching a growing share of state spending going toward pension funding, declared in 2005 that end-of-career salary spikes could not exceed 6 percent. Any school district that boosted pay for retiring teachers above that amount would have to pay extra into the TRS.
Teachers unions, once again showing their negotiating brilliance, soon persuaded many school districts that they must give 6 percent annual increases to retiring teachers. What was supposed to be a ceiling became a floor. […]
Just a year ago, the Legislature, again trying to slow increasing pension costs, lowered the 6 percent level to 3 percent.
The limit doesn’t mean that local school districts can’t give increases to impending retirees larger than 3 percent. It just means school districts that do will have to pay the extra costs to cover the higher pensions.
- Ok - Monday, Jun 3, 19 @ 11:54 am:
“to help save the teaching profession”
I like that spin there…
- RNUG - Monday, Jun 3, 19 @ 11:57 am:
Going back to past practice of 6% raises goosing the final average compensation for retiring teachers will have a noticable impact on the pension debt.
So far JB’s record on pension debt is mixed, mostly a gentleman’s C grade.
- Donnie Elgin - Monday, Jun 3, 19 @ 12:01 pm:
The 6% pre-retirement increase will shortly be included in every union negotiation as a must have.
- Donnie Elgin - Monday, Jun 3, 19 @ 12:03 pm:
funny I though hb2078, the 40K teacher salary was the one that “took action to help save the teaching profession”
- City Zen - Monday, Jun 3, 19 @ 12:16 pm:
The use case is the 30-year teacher handing in their resignation notice 4 years in advance of achieving their 75% maximum vesting benefit and being awarded with a 6% compounded increase over those 4 years. This law was poorly written and should’ve only gone into effect after 25 years of service.
- Travel Guy - Monday, Jun 3, 19 @ 12:17 pm:
Most of the folks speaking negatively about the 6% ceiling have no understanding of what the 3% cap did to local school districts, especially rural districts. It was keeping experienced educators from taking on new leadership roles…and also keeping them from taking on additional responsibilities like being a coach or club sponsor. It was keeping districts from finding the most qualified candidates to staff programs (or finding anyone at all), and it is wonderful that they have rectified the problem.
- My New Handle - Monday, Jun 3, 19 @ 12:17 pm:
BIMPs always seemed to be one of most rewritten bills, lots of last-minute shenanigans and Easter eggs.
- allknowingmasterofraccoodom - Monday, Jun 3, 19 @ 12:18 pm:
I think it is ironic that the Gov supports this all the while shorting the pension payments by some $900 Million dollars.
Smoke and mirrors.
- Cog - Monday, Jun 3, 19 @ 12:24 pm:
The problems with the language as it existed at 3% (and to a lesser extent at 6%) is that despite it often being framed as a limit on raises, it was a limit on total compensation compared to previous year, no matter the reason for. This was really poorly thought out.
Thinking about giving a teacher a promotion to a new position? Better not, because if they retire or quit, that year might be one of the years used to calculate their pension, and the school is on the hook for a percentage of that person’s pension at sometime in the future. Can’t plan for it, and the former employee might not start drawing a pension for years. Maybe wont get the bill for another 20 years, but it could happen. Same risk in having a college instructor teach an extra class (seriously, there was no exemption for changes in teaching load) or take on additional duties like coaching or similar. The school, college, or university would be penalized and had no way to control if the employee would quit and start drawing a pension years or decades later, incurring the penalty.
That kind of uncertainty had the effect of unintentionally incentivising institutions to stop promoting from within, assigning new classes or duties.
I don’t personally have a problem with language trying to limit pension spiking, but there has to be a better way than that. City Zen’s suggestion of having it go into effect after 25 years of service would have been a big improvement.
- Still Waiting - Monday, Jun 3, 19 @ 12:38 pm:
The 3% cap started a bidding war in our area. Since teachers knew they were effectively capped at a 3% increase, it encouraged them to look at changing districts to get bigger raises. Then, with so many changing districts, schools began giving credit on their salary schedules and paying signing bonuses in an attempt to make sure they had teachers in the classrooms.
- JT - Monday, Jun 3, 19 @ 12:42 pm:
I was told that I had to cease teaching part-time for another university due to this cap by my full-time employer. If they want to fix spiking, draft language that actually addresses spiking.
- Almost the weekend - Monday, Jun 3, 19 @ 12:45 pm:
If I’m a tier 2 teacher and quickly growing in the rank and file I’m asking leadership what is being done for us. This crack is only going to grow.
- Obamas Puppy - Monday, Jun 3, 19 @ 12:55 pm:
Its called property tax relief, you either want the state to pay or property tax payers. When you have a teacher shortage and you limit state resources that go toward that profession the shortage only gets worse.
- Tim - Monday, Jun 3, 19 @ 12:59 pm:
This might have been one of the dumber things they did this weekend. They just goosed the pension deficit again by laying down for the IFT and the IEA.
- Enviro - Monday, Jun 3, 19 @ 1:28 pm:
3% cap on salary
Tier 2 retirement plan
social security offset
These are some of the reasons for the teacher shortage in Illinois.
- City Zen - Monday, Jun 3, 19 @ 1:36 pm:
==If I’m a tier 2 teacher and quickly growing in the rank and file I’m asking leadership what is being done for us==
You should be on a separate (higher) salary schedule. That will require a lower salary schedule for Tier 1. Float that idea with your union and see where it goes.
- BBNBBC - Monday, Jun 3, 19 @ 2:06 pm:
As Coach Ditka stated, “Who ya crappin “?
No longer a basic skills test. That’s right, what’s best for the students, for the kids.
LOL
- Tim - Monday, Jun 3, 19 @ 2:41 pm:
BBNBBC - 100% correct. The IEA and the IFT only care about what is best for the adults, not the students. Those two groups do not represent the kids.
- walker - Monday, Jun 3, 19 @ 2:48 pm:
Shoulda been a separate bill open to specific debate and vote. If there are situations, (new skills levels, added responsibilities, etc), that reasonably justify the 6 percent, then we should have written and passed a “waiver availability” bill. I don’t think teachers understand how difficult this makes defending their pensions to the voters.
- Maximus - Monday, Jun 3, 19 @ 3:11 pm:
If teachers were part of a defined contribution system for their retirement plans this would be a non-issue going forward. School districts could pay whatever the market rate dictates for their area and adjust as needed. Give teachers social security and a 401k and call this problem solved.
- Dave W - Monday, Jun 3, 19 @ 3:41 pm:
And just when TRS was starting to top the 40% funding level. Back down into 30s it will go.
- Chicagonk - Monday, Jun 3, 19 @ 3:43 pm:
Well that’s disappointing. Special interest groups win again.
- Enviro - Monday, Jun 3, 19 @ 4:08 pm:
==Give teachers social security and a 401k and call this problem solved.==
Tier 2 teachers will receive a pension benefit that is less than social security and a 401k.
- Travel Guy - Monday, Jun 3, 19 @ 4:32 pm:
==Give teachers social security and a 401k and call this problem solved.==
Comments like this are why people who lack an understanding of a given issue should refrain from spouting IPI talking points.
The pensions have to be paid (according to the Illinois Constitution and Illinois Supreme Court), so if you remove the revenue from the system, whom do you hunk is stuck with the entire bill?
Tier two will help to solve the problem on paper…until someone retires and sues because it doesn’t pass the Social Security waiver smell test.
- Ole' Nelson - Monday, Jun 3, 19 @ 5:26 pm:
Maximus, be careful what you wish for. If the State had to make social security payments and say a 4% 401k match like many private businesses to their teachers, they would be in worse shape than they are now. Tier II pays for itself and then some.
- City Zen - Monday, Jun 3, 19 @ 5:35 pm:
==If the State had to make social security payments and say a 4% 401k match like many private businesses to their teachers, they would be in worse shape than they are now. Tier II pays for itself and then some.==
According to TRS, the normal cost for Tier 1 employees is now 12.65%. Tier 2 knocks that down to 10% , the equivalent to your example.
I think we’ve moved beyond the “pension is cheaper than the alternative” argument. We’re paying the same cost but assuming all the risk.
- Bavette - Tuesday, Jun 4, 19 @ 6:24 am:
There is no teacher shortage in Chicago. Desirable areas attract talent. Is there a problem attracting people to Downstate Illinois?
- Bavette - Tuesday, Jun 4, 19 @ 6:26 am:
CityZen, it’s frightening that Illinois taxpayers are on the hook for investment returns and pay more for providing that benefit.
- Teacher - Tuesday, Jun 4, 19 @ 6:55 am:
The raise and repeal of 3% might have larger implications. Bipartisan support has already been drummed up for fewer districts in the state. Both these deals (which teachers and unions will support) will make it more difficult for the financially unstable districts. This has the ability for those districts to look at consolidation alternatives.
- Bavette - Tuesday, Jun 4, 19 @ 9:15 am:
Consolidation would be great, Illinois has far too many governments.