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Brady wants all pay raise pension costs shifted to school districts

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“Every school district and every college that gives a pay raise from this day forward needs to also pay the pension cost of that pay raise,” [Sen. Bill Brady] told the Daily Herald editorial board Wednesday.

The idea is a cousin of the controversial proposal to have school districts pay for all of teachers’ future retirement costs, which Brady opposes. Opponents say the so-called cost-shift could hamper local schools’ budgets and force cuts elsewhere.

Brady says school boards shouldn’t be allowed to raise salaries and foist the cost onto the state.

“We have no control over those pay raises.”

Unlike Speaker Madigan’s “cost shift” proposal, Brady’s would only deal with pay raise costs going forward, not full salaries, past and present, and pension debt.

It’s not a bad idea. One of the reasons Illinois got itself in over its head on pensions is that the state made itself responsible for funding teacher and university pension systems. The costs just grew too high, and the state has no control over those costs, other than paying its bills on time (which would’ve kept those costs from rising, but hurt other budget items, like schools themselves).

posted by Rich Miller
Thursday, Jan 23, 14 @ 10:20 am

Comments

I agree.

I actually agree with something Bill Brady said.

(Swoon. Thud.)

Comment by Aldyth Thursday, Jan 23, 14 @ 10:25 am
Which costs Rich? The normal costs which are absolutely not high, or the costs of using the pensions as a piggy bank, which the state had absolute control of?

Comment by PublicServant Thursday, Jan 23, 14 @ 10:26 am
That’s it! Brady’s officially off Rahm’s Christmas card list!

Comment by Javorica Thursday, Jan 23, 14 @ 10:29 am
I think Rep. Cross suggested something similar in response to Speaker Madigan’s cost shift. I believe the specific suggestion was the for the last 4 years of a teachers career, the school district would be responsible for any pay raises (they are currently responsible for the part of the pay raise in the last 4 years of the career that is over 6%). I believe the school’s said they preferred the shift of the normal cost compared to Rep. Cross’ proposal…

Comment by Anon Thursday, Jan 23, 14 @ 10:32 am
School districts should pay for the pensions and not pass on to the State. We will see how generous they are with their own money.

Comment by Mokenavince Thursday, Jan 23, 14 @ 10:33 am
The pensions wouldn’t have been borrowed from in the first place if the state didn’t have an income tax structure that couldn’t support a one room schoolhouse, or kick in a couple of bucks for the downtrodden. Don’t put the deferred compensation element of the state’s workforce up as the boogyman here.

Comment by PublicServant Thursday, Jan 23, 14 @ 10:33 am
This isn’t stupid by any means. The fact it will require a lot of finesse and Bill doesn’t have a “finesse fund” will make it uphill and subject it to redefinition. Too bad. In a sane world, the other guys would look at this, say it has merit, agree to study it further and get some actuary working the numbers. This could be a first step to DECIDING if shifting the whole thing to the districts would make sense. The effort could gather some steam if the serial abusers were out in the sun light on this. Good policy from Brady. Regardless of where he winds up in this, I respect him for the creative and sane approach.

Comment by A guy... Thursday, Jan 23, 14 @ 10:41 am
From Article X, Section 1:
The State has the primary responsibility for financing the system of public education.
(Source: Illinois Constitution.)
———-
It would seem that paying school district employees’ salaries and benefits are part of financing the system of public education. The State has already reneged on financing education by shifting much of the cost to local property taxes. This would just be shifting that much more from the State’s Constitutional responsibility.

Comment by Joe M Thursday, Jan 23, 14 @ 10:43 am
Aldyth, your post is exactly how I feel.

===I agree. I actually agree with something Bill Brady said.(Swoon. Thud.)===

Comment by Been There Thursday, Jan 23, 14 @ 10:46 am
Ha, all non certified workers are members of IMRF of which the school district pays 100% of the pension costs. For too long school supers struck deals essentially giving them a pension worth annaully pretty much eaqaul to their last year’s salary. Why? Because it costs the schools nothing. Look at the pension reports and you will find the highest paid pensioners in Illinois are school supers.

Comment by Jim'e' Thursday, Jan 23, 14 @ 10:50 am
Of the $6.19 billion General Fund contribution to
the five pension systems for FY2014, about $1.02 billion is attributable to the normal cost of the benefits being earned by current workers, while $5.17 billion constitutes debt repayment (using the pension system as a piggy bank)

Comment by Howard Thursday, Jan 23, 14 @ 10:51 am
It’s a smoke and mirrors. You either shift the cost or you don’t. It’s not like school districts are never going to give anybody a raise. This is a backdoor way to cost shift which would involve a lot of extra paperwork.

Either the state pays the employer cost (which they have taken responsibility for, but have never actually done in full), OR the district pays and is allowed to levy the cost (as they already do for IMRF and Social Security).

The real problem is that any actual solution will cost money, and Brady wants to pretend it doesn’t. (Previous attempts at cost shifting have failed because the local districts point out that they will need more money from the state or from property taxes.)

Comment by Pot calling kettle Thursday, Jan 23, 14 @ 10:55 am
Rich,
The costs of the actual benefit were never too high, in fact the normal cost has been and continues to be affordable by any estimation. The “cost’ is the debt and the interest on that debt from underfunding. This Brady proposal is a gimmick, please stop falling into this trap of pay raises mattering, it is just not correct. Its a diversion from the facts that long time legislators like Brady do not want to answer to.

Comment by Obama's Puppy Thursday, Jan 23, 14 @ 10:57 am
No quarrel with a cost shift, but give school districts the means to levy just like IMRF.

Comment by Retired Thursday, Jan 23, 14 @ 10:58 am
===The costs of the actual benefit were never too high, in fact the normal cost has been and continues to be affordable by any estimation. The “cost’ is the debt and the interest on that debt from underfunding.===

Why do you think they skipped the payments? Because they were too low???

Comment by Rich Miller Thursday, Jan 23, 14 @ 10:59 am
Joe,
“Primary” does not mean “sole.”
I’m with Aldyth. It is not a bad solution.

Not to digress, but Brady is also bragging about his support for term limits.

Have I missed the announcement of his resignation? Is an announcement scheduled?

Comment by Smoggie Thursday, Jan 23, 14 @ 11:00 am
I can hear the screaming when property taxes increase to cover the additional cost to the district. The state thought they could pick up the pension cost as part of their share of funding education…then after they agree to pick up the cost, they don’t actually put the money into pension funds. Now that this scheme is catching up with the state, it is the districts raising the teacher salaries that is the problem, so let’s shift the cost back to the district. The key to all of this is for someone to actually be honest and quit blaming and trying to pass the buck. All the candidates are doing this blame came and are busy pointing fingers at everyone else rather than themselves.

Comment by illinifan Thursday, Jan 23, 14 @ 11:07 am
That’s a reasonable position from Brady. Telling the local folks that they have to pay for their decisions is pretty brave. Good on him.

Comment by wordslinger Thursday, Jan 23, 14 @ 11:08 am
I skipped my house payment because I thought it was too high! If the legislature can get away with it why can’t I? There is a storm coming.

Comment by Howard Thursday, Jan 23, 14 @ 11:09 am
Standard Conservative position to have those responsible for the hiring and management of employees, to pay for their entire compensation.

Comment by walker Thursday, Jan 23, 14 @ 11:09 am
Not a bad idea. Of course, the employer pension cost for the raises will be zero by 2035 since - even before pension reform according to the COGFA report for year ending June 30, 2012 - the employee is paying the full normal cost at that time.

The impact on schools would be gradual and decline to nothing in 20 years.

It would be interesting to see the impact of this cost shift versus Madigan’s proposal.

Comment by archimedes Thursday, Jan 23, 14 @ 11:10 am
They skipped the payments because the revenue was down or the state wanted to spend more money than it had. Shock! The state spends more than it has! Looks for a way to keep spending without having to raise taxes and finds….pensions payment holidays.

Comment by dupage dan Thursday, Jan 23, 14 @ 11:11 am
===because the local districts point out that they will need more money from the state or from property taxes.) ===
I my mind that is exactly the point. Now you have the Hinsdale’s and New Trier type districts paying huge salaries and the state is picking up the pension cost on those. While I think Brady’s proposal is ok I would rather see the state only pay the pensions on only up to a fixed amount. Maybe what the highest paid teacher gets in Posen. If the districts want to pay higher salaries then they should be on the hook for the higher pensions.

Comment by Been There Thursday, Jan 23, 14 @ 11:13 am
seems reasonable. perhaps we should do the same for state pensions. Not change for current vested employees, but going forward change it for new and non-vested employees….

and Rauner didnt propose eliminating all teacher pensions and replacing them with a 401k style system? he is off message….

Comment by Ghost Thursday, Jan 23, 14 @ 11:18 am
It is so nice to debate ideas. I think it is a great one. Good for him on proposing this concept. If…If…This were to get traction, who could not get behind the concept of skin in the game? Also, to offset, eliminate ISBE… Interesting ideas.

Comment by Walter Mitty Thursday, Jan 23, 14 @ 11:19 am
===Why do you think they skipped the payments? Because they were too low???===

They skipped their payments because tax revenues weren’t there to cover state program costs and because they could, Rich. Much easier than raising taxes to pay for state programs.

It’s not a matter of “Would you rather pay for Johnnie’s education and Mabel’s nursing home costs, OR pay state employees”. That’s a red herring. How about “Would you rather raise the revenues necessary to pay for the priorities that your representatives have passed into law including the costs of the state employees required to carry those priorities out, OR just borrow from those state employees deferred compensation for 6 decades and then blame them for the crisis that your borrowing has caused?”.
That’s a retorical question since we already know what the spineless reps have choosen to do. Now we just have to wait to see whether they get away with it.

Comment by PublicServant Thursday, Jan 23, 14 @ 11:22 am
Sorry, meant rhetorical…

Comment by PublicServant Thursday, Jan 23, 14 @ 11:28 am
Sounds good to me when SB1 is found unconstitutional

Comment by foster brooks Thursday, Jan 23, 14 @ 11:31 am
*****While I think Brady’s proposal is ok I would rather see the state only pay the pensions on only up to a fixed amount. *****

+1
The state can say, we will pay pensions in full up to x amount of dollars, after that it is on the district. Each year the base(x amount of dollars) will grow based on CPI(or some other economic formula).

Now, if that is even constitution, is a whole other story.

Comment by Anonymous Thursday, Jan 23, 14 @ 11:32 am
Please. If you are going to make assertions about how a particular pension cost somehow created a crisis, back up your statements with something empirical or you just sound like the Civic Committee. And your response “Why do you think they skipped the payments? Because they were too low???” is not convincing either. Hello, if it were really a problem with the costs being too high, they could have enacted a cost shift instead of just raiding the fund. Not that I disagree that it is unfair to have the State pick up the cost with no accountability. Just that I don’t think you have made your Chicken Little case that those costs made the sky fall.

Comment by anon Thursday, Jan 23, 14 @ 11:33 am
I’m going to specifically address Brady’s proposal in a separate post.

I’ve always thought the pension part of the school funding was screwy. As I understand it, historically, the reason the State assumed the future cost of the teacher’s pensions is the State did not want to send the money to pay the pension benefits when earned to the school districts in the current fiscal year just to have the money sent back to the pension funds. (Guess it was something to do with not trusting the school districts to send the money back.) It was also a way for the State to hold down school funding in the current FY by pushing the pension cost off into some future time. If the school districts had received the money to fund the pensions in each fiscal year, they would have been on the hook to make the employer contribution each year. It would also have given a clear(er) picture of the actual school costs. Because those costs were hidden, the local school district had no incentive to hold down the salaries. In fact, because the employer contribution was “free”, a number of school districts picked up the employee contribution in lieu of raises or other benefits.

I am actually in favor of shifting the normal cost of the school pensions to the school districts and upping the amount of State aid to the school districts to match that normal pension expense. By itself, it doesn’t do a darn thing to solve the pension problem but it does get the pension cost back into the whole school funding formula where it should have been in the first place. Once it is there, it is visible in every school district budget and every district’s taxpayers clearly will be able to see what those (sometimes high) teacher and administration salaries are costing.

Once the pension costs are clearly visible, there can be a valid debate about the cost of education in this State that includes ALL the costs. There could also be discussions about gradually shifting some of those normal pension costs from the State to the school districts in such a manner as to not impact local taxes, say something like 2% to 5% of the cost shifted every year.

Just had to vent the above …

Comment by RNUG Thursday, Jan 23, 14 @ 11:34 am
It sounds like a good idea, but schools would have to be able to get property taxes raised to do it. Right now many counties have caps which would cause the schools to be in the red just like the state.

If we are going to continue to hire/fire/control pay and benefits at the local district level, then it is only fair that pension costs start shifting there.

However, why did the pension costs become the states responsibility in the first place, and how do we prevent those types of situations coming up again?

Comment by mythoughtis Thursday, Jan 23, 14 @ 11:34 am
I hate the pension “fixes” as much as anybody else, but I find it amusing that people still want to say there isn’t a problem. Do I believe it’s a crisis? I suppose it depends on how you define crisis. It’s certainly a crisis in terms of the state budget. You can’t just continue to say there isn’t a problem and use the excuse that the state didn’t make their required payments. Yeah, so what? You can’t do anything about it now. I have no idea what the fix is but I can tell you that the fix can’t simply be to tell the state to make their required payments. Would I like that to be the fix? Absolutely. Do I want to lose anything from my pension? Absolutely not. Do I recognize that telling the state to simply make the payment isn’t a solution? You bet. Now let the angry responses to this begin.

Comment by Demoralized Thursday, Jan 23, 14 @ 11:38 am
To Brady’s specific proposal:

No one realistically expects teachers to never get another raise and the State has stated it is the primary funding source for education (but not lived up to it). I think the local school districts should have to pick up the normal pension costs for any raises that exceed the previous year’s rate of inflation. Or maybe raises for something like a three year period, that when totaled, do not exceed the rate of inflation. An averaging scheme would account for the situation where a district is too short funded to give raises in a specific year.

In other words, the State stays on the hook for pension funding of normal raises and the district has to pay pension funding for excessive raises.

Comment by RNUG Thursday, Jan 23, 14 @ 11:43 am
Obama’s Puppy - really? Superintendents retiring at 60 with annual pensions of $200K or $250K is reasonable? Of course not. Pension benefits at that level are absurd. If school districts want to pay them, they should justify it to their local taxpayers. The wealthiest districts are the worst culprits, all at a cost to the state taxpayers.

Comment by Anonymous Thursday, Jan 23, 14 @ 11:45 am
And Brady finished last in the “working with MJM poll”.

Comment by Nonplussed Thursday, Jan 23, 14 @ 11:47 am
=== Do I recognize that telling the state to simply make the payment isn’t a solution? You bet.===

No one said “just pay” Demoralized, but the “heavy lifting” wasn’t to take that tough vote to pass SB1, the tough vote is to raise revenues enough to pay for the expenses of the state including the debts the state incurred by its foolish borrowing from the pension funds. You can’t claim “We’re bankrupt!” and then just after one class of debtors (state employees and retirees) and leave the others (bond holders and those vendors with billions in unpaid bills) whole. Wouldn’t that be nice if the state could pull off a “selective bankruptcy” like that? Better than the current real bankruptcy laws where all debtors have to be treated alike, huh?

Comment by PublicServant Thursday, Jan 23, 14 @ 11:47 am
Rich,
Because they wanted to fund other new programs and not pay the contribution. The cost of the benefits being earned today is not the problem and never was. There is a difference between the cost of the benefit and the payment on the debt. shortchanging the payment has nothing to do with its affordability, that decision was made out of political expediency and misplaced priorities.

Comment by Obama's Puppy Thursday, Jan 23, 14 @ 11:52 am
@PublicServant:

I know you have strong views on the subject and I respect them. But I don’t believe, from a practical standpoint, that the answer can simply be to raise revenues. I would absolutely prefer that to be the solution. And maybe that’s all they will be left with when the courts hear the case, though I’m not convinced the courts won’t uphold at least some of the law they passed. I’m hoping for the best and preparing for the worst.

Comment by Demoralized Thursday, Jan 23, 14 @ 11:53 am
Give school districts the opportunity (outside the CAPS) to levy…just like IMFR; true transparency with regards to staff-costs for districts. Will it increase the tax rates? Yes, but it won’t further negatively impact the educational fund. Public and attend levy hearings and testify on the impact of class sizes, programs, etc. Anything else is a death-sentence for the “have nots” in the State.

Comment by southof80 Thursday, Jan 23, 14 @ 11:59 am
@PublicServant:

Also, I’m not sure vendors would say they are being left whole. And bankruptcy laws don’t treat everybody alike. I understand what you are saying, I’m just not sure I agree with it.

Comment by Demoralized Thursday, Jan 23, 14 @ 11:59 am
===I’m hoping for the best and preparing for the worst.===

Me too, but I never said raising revenues was simple, but it is necessary, as is clear by the fact that the state still is running huge deficits even after slaying the pension boogyman that they had previously blamed the problem on.

Comment by PublicServant Thursday, Jan 23, 14 @ 11:59 am
“the state has no control over those costs, other than paying its bills on time (which would’ve kept those costs from rising, but hurt other budget items, like schools themselves.” This is another oft-repeated illogical red herring argument. Do you think those schools and opther programs magically run without any employees? Any program which employs people is necessarily going to incur the cost of compensating those people including retirement benefits. Paying pensions IS paying for schools, etc.

Comment by anon Thursday, Jan 23, 14 @ 12:01 pm
Vendors are being given interest on their outstanding debt after 90 days. Seems pretty whole to me. Also, ““fair and equal” treatment of all unsecured creditors” is in the bankruptcy code…just sayin.

Comment by PublicServant Thursday, Jan 23, 14 @ 12:03 pm
=They skipped their payments because tax revenues weren’t there to cover state program costs and because they could, Rich. Much easier than raising taxes to pay for state programs.=
They raised income taxes by 67%.

Comment by Downstater Thursday, Jan 23, 14 @ 12:06 pm
Well downstater, then you ought to be cheering for the implementation of Ralph Martire’s progressive tax plan that would lower taxes for 94% of Illinois taxpayers.

Comment by PublicServant Thursday, Jan 23, 14 @ 12:10 pm
School districts pay next to nothing (.5%) towards retiree pensions, whereas the state compensation hovers between 15-20%. This is a slippery slope if districts are asked to contribute more. Districts will immediately levy, thus placing the burden on the homeowners and businesses. Yet, the value of homes is directly tied to the quality of the school, thus the quality of the teachers. I’m sure there’s no argument on this.

Let’s be creative: separate administrator pay/pension contributions from teacher contributions. If districts perform well on state exams, ACT testing, etc., then teachers get higher contributions toward their pensions. Finally, let’s revisit the formula of how we fund our schools and ease the burden on the homeowner. Of course, the wealthy districts don’t want that because there goes the value paid for the exclusive home. Welcome to Thunderdome.

Comment by Now What? Thursday, Jan 23, 14 @ 12:10 pm
Its all people spending other peoples money. The only question is the other peoples money local or statewide.

Comment by Jack Handy Thursday, Jan 23, 14 @ 12:12 pm
It’s a good idea.

Brady made sense during the Rauner minimum wage kerfuffle and makes sense again.

Comment by Formerly Known As... Thursday, Jan 23, 14 @ 12:15 pm
Shift the cost, shift the revenue. Make it net zero impact on the schools. Increase the revenue by inflation every year. Now the schools have an interest to reduce the cost because the revenue will stay the same and they’ll pocket the savings. The State can then say they’re better funding education.

Boom! Done.

Comment by thechampaignlife Thursday, Jan 23, 14 @ 12:39 pm
Is he talking about the typical teacher longevity/educational ’steps’ in a typical teacher’s union contract (which makes the proposal sort of silly)?
Or is he talking about the deals where an employee is taken off of the typical pay arc schedule and given a series of maximum raises for the last 4 years (which makes some sense)?

Comment by titan Thursday, Jan 23, 14 @ 12:45 pm
“We have no control over those pay raises” says Sen. Brady. And the beleaguered property taxpayers do? Even if an elected school official promised to restrain wage increases, all it would take is one strike and he or she would cave.

Comment by Cook County Commoner Thursday, Jan 23, 14 @ 12:55 pm
When my community college discussed this when Madigan first brought it up, the consensus was that the college could live with the shift IF the State used the money it would save to more adequately fund the college. The formula (and I am not sure if it is in statute or not) is supposed to be 33-33-33, with 33% coming from the State, 33% coming from property taxes, and 33% coming from tuition. In the last fiscal year, the State only paid about 12%.

Comment by G'Kar Thursday, Jan 23, 14 @ 1:02 pm
–the state has no control over those costs,–

The State does not have control over the salary that the pension is based off of, but it does have control over the % funded, the age of retirement, years needed for service time and the COLA. This is why it would make some sense to have some kind of % cost shift, but not the entire bill. We need both the State and the employer having skin in the game.

Comment by Ahoy! Thursday, Jan 23, 14 @ 1:15 pm
G’Kar - Thursday, Jan 23, 14 @ 1:02 pm:

That’s pretty much been my point all along about last year’s proposed cost shift; what is now labeled pension funding will just end up labeled school funding once the schools ask for the money to make up the shortfalls caused by taking on the pensions.

I don’t have a problem with that (as I noted above), but it doesn’t save the state budget any money.

The one BIG ADVANTAGE I see in doing a shift is political; once the pension costs are again part of school funding, from the public’s perspective, we will no longer have a pension problem, we will have a school funding problem. And it’s a lot easier to sell a tax hike to save the schools than it is to sell a tax hike to save the pensions.

Comment by RNUG Thursday, Jan 23, 14 @ 1:23 pm
==And the beleaguered property taxpayers do?==

I get tired of that refrain. Yes, as a matter of fact, you do have a say. It’s called voting. And don’t whine about the people you vote for not doing what you want them to do. Guess what? You can vote for somebody else next time. It’s like the term limit garbage. We want somebody else to fix the problem we can’t fix on our own through the voting booth. We are either a representative democracy or we aren’t. Pick one.

Comment by Demoralized Thursday, Jan 23, 14 @ 1:49 pm
” Yes, as a matter of fact, you do have a say. It’s called voting.”

And many get tired of the claim that this is a representative democracy. It’s not. In the northeastern part of the state it’s a party machine dominated in large part by the monies flowing to pols from the special interests, which include organized labor. The folks who seek to run against this machine are crushed due to lack of funds. It all was tolerated by a fatuous and apathetic electorate so long as some meat was left on the bone for them. That seems to be coming to an end based on the abysmal economic numbers in Illinois. The only question is if a point of no return has been passed for many communities in the state. Considering that the state executive and legislative branches have painted themselves into such a corner on pensions that their “solution” requires requires intervention by a judiciary whose members have an interest in maintaining the status quo seems to say it all.

Comment by Cook County Commoner Thursday, Jan 23, 14 @ 2:33 pm
Do what the NFL and NBA do, call it a “LUXURY TAX” Then see how many school districts and their local tax payers want to absorb that luxury.

Comment by A guy... Thursday, Jan 23, 14 @ 2:49 pm
==whereas the state compensation hovers between 15-20%.==

Where do you get this number from? Everything that I have seen from TRS has the normal cost of the pension hovering around 17-18% of salary - and the employee picks up 9.5% of that. That leaves the state on the hook around 8%.

Compare that to SS which has an employer match (to the cap at least) of 6.2%. Around a 2% difference doesn’t seem like much to me, especially in light of many employers making a 401k match.

Additionally, can we not pretend that statements like this “We will see how generous they are with their own money. ” make sense? If the district gives a $1000 raise - they are responsible for paying - you guessed it- $1000. The state would be responsible for the normal cost of that (minus the employee share) of around 8%. $80, the outrage!

All that being said, if the state actually gave the districts the recommended aid funding, I don’t see a shift from earnings here on out onerous provided it’s the normal cost, and not the cost to make-up for the shortfall due to chronic underfunding.

Comment by iThink Thursday, Jan 23, 14 @ 2:54 pm
“I think the local school districts should have to pick up the normal pension costs for any raises that exceed the previous year’s rate of inflation.”

Great point RNUG and you beat me to it as have thought of this in the past, I naturally agree.

Other food for thought. Why just pick on school districts? Why not ALL the pension programs. Deduct pension costs from the agency/department/university budgets and show a more complete cost of that government body.

Does anyone believe that only public schools give big fat increases to their employees. Happens all the time. Go back and look at some of the increases that the State Police have received over the past decade compared to other state workers. Often happens at universities as well. (And yes, I am a SURS retiree.)

None of this type of discussion should be dismissed, but a lot more thought needs to be involved and that rarely happens with the Governor and GA. Usually an ill thought out knee jerk rejection is passed off as a solution.

Comment by Federalist Thursday, Jan 23, 14 @ 3:00 pm
Oh my goodness. First it was thinking about pulling a GOP ballot in the primary to vote against Rauner, Now I’m agreeing with Brady on something? Those “slippery slope” arguments are real!

Comment by Soccermom Thursday, Jan 23, 14 @ 3:07 pm
I have never understood why low-income residents of Marion should have to pay income and sales tax to support wealthy retired administrators from wealthy school districts in the Chicago suburbs — especially when those retirees take their checks out of state to warmer climes…

Comment by Soccermom Thursday, Jan 23, 14 @ 3:09 pm
“Additionally, can we not pretend that statements like this “We will see how generous they are with their own money. ” make sense? If the district gives a $1000 raise - they are responsible for paying - you guessed it- $1000. The state would be responsible for the normal cost of that (minus the employee share) of around 8%. $80, the outrage!”

Do a little math. If you give an administrator a $40,000 end-of-career raise in the last three months of his/her contract, that costs the district $120,000. That will increase the administrator’s pension by $32,000 a year, for however many years the administrator (and his/her surviving spouse) hang on in their lovely suburban Phoenix home. So for $120,000, the district can provide a lovely $700,000 gift to the administrator - -and that’s before the COLAs. Thanks, Illinois!

Comment by Soccermom Thursday, Jan 23, 14 @ 3:14 pm
==Joe,
“Primary” does not mean “sole.”==

Illinois state government pays less than 25% of the cost of public school education in Illinois - the lowest percentage among the 50 states. The mean of the states is around 46%. I don’t think we have to worry about the State becoming the “sole” provider of dollars for education in Illinois.

Comment by Joe M Thursday, Jan 23, 14 @ 3:21 pm
Soccermom, you sound like someone whose high school district has a $120 million fund balance, lol.

Comment by wordslinger Thursday, Jan 23, 14 @ 3:25 pm
I don’t know the particulars, but there is already a rule?, regulation? for TRS members where if there is a salary increase more than a certain percentage, the school must submit the extra money necessary to fund the annuity.

Comment by lakecounty Thursday, Jan 23, 14 @ 3:34 pm
=== If you give an administrator a $40,000 end-of-career raise in the last three months of his/her contract, that costs the district $120,000. ==

Last time I checked there was a maximum increase of 6% on the last four years of salary. So I am pretty sure your $40k a year raise ain’t happening. But to the point, we aren’t just talking about ridiculous end of career bumps, but every raise those teachers get - and the district pays that with their own money.

And what portion of the liability comes from these bumps? Wasn’t it less than 10%? And that was before the 6% limit was enacted. Not that it isn’t a problem, but let’s not make a mountain from a mole hill.

Comment by iThink Thursday, Jan 23, 14 @ 3:39 pm
I meant last three years — mistyped. Sorry. And let’s make it four years. And let’s also remember the huge pension sweeteners that were handed out before the 6% cap per year was put on. And the folks who retired early to avoid the cap. Grrrr.

Comment by Soccermom Thursday, Jan 23, 14 @ 3:53 pm
The state’s top earning superintendent for the 2006-2007 school year was Mary Curley of Hinsdale School District 181, who made more than $385,000. She retired in 2007. Dist. 97 Supt. Constance Collins made more than $217,000 that year and former Supt./Principal Susan Bridge made roughly $290,000. Bridge, who retired in 2007, was in the top 20 in salary while Collins ranked near 100 in earnings. The highest paid teacher in Dist. 97 that year made around $127,000 and in Dist. 200 the top earner among teachers made just under $140,000.

Comment by Soccermom Thursday, Jan 23, 14 @ 3:54 pm
==And many get tired of the claim that this is a representative democracy. It’s not.==

I’m pretty sure it still is. But I won’t belabor the point any longer other than to say I disagree with you.

Comment by Demoralized Thursday, Jan 23, 14 @ 3:58 pm
Beginning in about FY07, the district could still give Dr. Wonderful the $40k raise, but they would be on the hook for the actuarial impact of the cost above 6%. Paid up front. On a big salary, that tab can run six figures.
Supers since then have for the most part kept their raises at 6% and secured board-paid annuities or other perks to “keep whole.”

To the post, I prefer the Speaker’s cost shift. Raises are a fraction of compensation and most raises are step/lane increases arising out of a bargaining agreement.
I appreciate Bill’s interest in the issue and would like him to introduce a bill that would either prohibit or require the employer to pay the full actuarial cost of any salary, benefit, or perk awarded to an administrator and which is not in the bargaining agreement. Everybody in, nobody out.

Comment by Arthur Andersen Thursday, Jan 23, 14 @ 4:10 pm
AA is bringing it today. Show me another media source that has the brains and insight as Cap Fax. I double-dog dare you.

Comment by Wordslinger Thursday, Jan 23, 14 @ 5:13 pm
==The highest paid teacher in Dist. 97 that year made around $127,000 and in Dist. 200 the top earner among teachers made just under $140,000.==

Not all school districts are created equal. There are huge differences in the Equalized Assessed Value of property per pupil. Thus some districts can spend half and even a third per pupil of what schools with high EAVs can spend. Not all districts can afford the high teacher salaries that are always being tossed around. The highest paid teacher in District 220 made $43,481. The highest paid teacher in District 170 made $59,555, but most made far less than that.

Throwing more expenses back to the poor rural districts will really hurt those districts.

Comment by Joe M Thursday, Jan 23, 14 @ 5:42 pm
The costs should be shared (50/50?) between the State and the districts as long as the State controls the formula for the pension benefit and the districts control the salaries on which the pension is based. Both entities should be accountable.

Comment by east central Thursday, Jan 23, 14 @ 7:49 pm