Print Friendly, PDF & Email

The thing about writing about Illinois government, particularly pensions, is that you’re forever discovering new things that make your jaw drop.

I only recently learned that the people of River Forest saw fit to make Ralph Martire president of their school board. He runs the Center for Tax and Budget Accountability. The CTBA is a union propaganda shop we’ve often criticized for distortions and half-truths.

I was truly skeptical when I reviewed today’s guest piece by Nick Binotti about that school board hiding a 100% teacher pension pick-up in their new school contract, so I looked at the contract and Nick’s FOIA answer. Good work, Nick. Read his article linked here.

It’s not like River Forest has the cash for such a thing. Their firefighter and police pensions are only 58% and 56% funded, respectively. (That’s from the most recent state report, which is 2014 numbers, so it’s probably much worse today.) Their firefighters and cops should be furious.

Sickening.

CORRECTED 9/12/17 to change North Riverside to River Forest

Mark Glennon is founder of Wirepoints. Opinions expressed are his own.

Sort by:   newest | oldest | most voted
fvtomasch

What is the healthcare premium pickup for the school districts at taxpayers expense. I believe it is more than the pension pickup. The RR STAR in Rockford once mentioned district 205 pays approx $21,000 in premiums per year for teachers. Can someone verify this? After all it is only taxpayers money and we are flush with cash!!!!

nixit

SD205 has a pension pickup. Per the contract: “The Board shall pick up and pay a maximum of 9.4%,
of the staff member’s Illinois Teacher Retirement System (“ITRS”) contribution…” As far as health benefits go, it’s hard to decipher their compensation report (see: http://www3.rps205.com/District/Documents/FOIA/CertCompReportFY17.pdf). I assume “Employer Allocation” is health care.

Mike

The employer allocation is likely the employer’s allocation of the state contribution to the pension fund per GASB 68.

But the amount seems too low?

The board should require that the administration provide a definition of employer allocation in the report.

The GASB equivalent for retiree healthcare (TRIP / THIS) had not yet taken effect.

nixit

No, I’m pretty sure “employer allocation” is health care coverage. Scroll down the report and see how some amounts repeat themselves no matter the salary. That looks like health care coverage to me. 14,000 (about 1,100/mo) might be about right for the employer coverage of healthcare. Maybe.

I think they have TRS Employer .58 and TRS Employer mixed up.

Mike

Then it seems the GASB 68 pension figure (proportionate share of state contribution to the pension fund) is not included on the report,

Wonder why Healthcare is listed as Employer Allocation.

Maybe the district is picking up the employee’s contribution to Healthcare.

NB-Chicago

Not sure what’s more horrible having a rahn chosen CPS school board or an elected school board filled with Martire types. River Forest Tax payer cover the pick-up? or I thought it’s the State, and so nobody cares at a local level? of course not addressed in new State school funding bill–same joke, 800+ schools distrticts cutting deals with teachers and staff and passing it on to state.. just new teachers get no pick-up? or any I wrong?

Something from Martire: “It’s an idea long advocated for by Ralph Martire of the Center for Tax and Budget Accountability. Loosely, it can be explained by saying that Illinois would treat its unfunded pension liability like someone taking advantage of low-interest rates to refinance the mortgage on a house. Spread out the payment cycle (a law passed in 1995 ramps up payments, so it’s been expensive in recent years); to the certain consternation of actuaries, some have suggested lowering the target to 70 or 80-percent funding, making the funding goal more realistic. At a time to some politicians “borrowing” is a bad word, and with ratings agencies… Read more »

Disappointing but hardly surprising. The thing that is infuriating is the teachers’ union will insist that the employer pick up is nevertheless STILL employee contributions to the pensions. Taxpayers are getting hosed here, bad.

Mike
The teachers, unions, administrators, and board members are omitting pertinent information when that is said. Rather than talking to them endlessly about the definition of employee contribution to the pension, consider the following. Obviously there is a benefit to teachers and administrators, since the pick-up is lieu of a pay hike. So what is the benefit? Here is the benefit, in the words of TRS: “However, these contributions are considered salary and are to be included in the member’s salary rate when reported to TRS.” What does that mean? Since the contributions are considered salary, that would be a salary hike. So the benefit to the employee… Read more »
anon

Are you sure that the amount of the pickup counts as pensionable income? If so, that completely changes the narrative that the pick-up keeps pension costs down. If a pickup is given in lieu of a raise, but essentially counts as income, then it’s no different than a raise. Then, the only conceivable “savings” is raises given on lower salaries, but I suppose the pickup would negate those savings. Very confusing.

Mike

Yes I am sure the amount of the employer pickup counts as pensionable income (creditable earnings).

Search for “Employer-paid 9.0 percent retirement contributions” here: http://www.trsil.org/employers/guide/chapter-two-creditable-earnings

Here is another indicator, from the above URL, that an employer pickup = pensionable income (creditable earnings):

“This method results in an employer cash outlay in excess of the member’s salary schedule amount.”