By Ted Dabrowski and John Klingner
Illinois school district superintendents keep finding ways to retire with generous Illinois pensions while continuing to get salaries to boot. We recently wrote about this type of double dipping here.
The scheme works because Illinois law lets retired educators collect a pension and go back to work, so long as they work part-time and no more than the equivalent of half-a-year.
Another example we’ve come across is a husband and wife tag team that recently shared a superintendent role 50/50. Dr. John Correll and Ellen Correll served as the interim superintendents at Skokie School District 73.5 during the 2020/2021 school year.
They were each paid $90,000 or a combined $180,000, according to the Illinois State Board of Education’s 2021 EIS database. That’s about $15,000 more than the state average for superintendent salaries.
What makes their work a double-dip is the fact that both retired and began collecting retirement checks from the Teachers Retirement System in 2019.
John Correll is currently receiving more than $210,000 a year and can expect more than $5 million in benefits during retirement. Ellen Correll, with fewer years of service credit in Illinois, is collecting a pension of nearly $80,000 and can expect $2.2 million in total benefits.
The couple also double-dipped the year before by serving as interim superintendents for the Antioch Consolidated School District 34.
Nice work if you can get it.
As we’ve said before, in the grand scheme of Illinois’ pension crisis, double-dipping is a niche issue. But it’s emblematic of Illinois’ corrupted retirement system. Double dipping works because Tier 1 public sector workers can retire with full pensions while still young enough to get other lucrative public sector jobs.
It’s another reason to retire pensions altogether and move to 401(k)-style plans.
Read more about double dipping and pensions:
- The Illinois pension scam continues: Superintendents double dip on the taxpayers’ dime
- Illinois’ regressive pension funding scheme: wealthiest school districts benefit most
- Tallying the perks in Illinois teacher contracts: guaranteed raises, sick leave, salary spiking, health insurance, generous pensions, and more
Audio and summary 
If this bill passes, say goodbye to local control over all Illinois parks and expect to see open drug and alcohol use, needles, no sanitation and fire hazards, but no ordinary park users.
Please quit using Chicago area as an example. I might also add, go teach for one week, then pass judgement. I am a retired teacher, down state, rural. My pension is not near this amount. I paid into my pension. The TRS has my money invested in stocks, bonds…. There are so many on here making comments that have no Idea of how things work. Why do republicans always use teachers to attack during election years? I worked SS jobs … but I will never collect. My husband gets both a pension and SS . When he passes, I will… Read more »
I hate to break it to you, but the sympathy for your arguments here are likely going to be non-existent or nearly so. They’ll have a variety of reasons for thinking otherwise and are likely to respond with vitriol, but it generally boils down to they’ve never been there and done that. Consequently all they have in the way of knowlege is their memories of being a student and a parent and having to deal with teachers. As the old Bell Curve would suggest some of their teachers probably were terrible, many were mediocre and a few were stellar. They… Read more »
I have sympathy for teachers, but only the good ones. They have a tough job and I know I couldn’t do it, which is why I’m grateful for their commitment, time, expertise and care. They are underpaid. You can blame taxpayers who don’t want their taxes increased, but there are lots of reasons why we are so frustrated and jaded. To list a few: (1) The underperformers are overpaid compared to their output, taking jobs that younger, more enthusiastic graduates could fill. (2) Those same underperformers are job protected, irrespective of their performance. (3) Pensions are constitutionally protected, but private… Read more »
Yes, a lot of what you state is reasonble and arguably true, but are the reasonable alternatives to whole educational system we now have? In old days of something like a hundred years ago teachers were easy to find, hire and dismiss. The consequences often weren’t all that commendable. Those easily found teachers generally had only a high school education or maybe a year of college. All they had to do were literally the basics of being responsible for student attendance, the maintenance of their classrooms and teaching reading, writing and arithmetic. Teachers today have a much wider set of… Read more »
Paraphrased from the Illinois State Board of Education (ISBE) website: In 2010, the Performance Evaluation Reform Act (PERA) was signed; changed how teachers’ and principals’ performance is measured. The new evaluation systems combine multiple measures of student growth and professional practice, based on standards of effective teaching, with evaluators trained and prequalified to conduct observations, collect evidence, and provide helpful feedback in a timely way. School systems will be expected to strengthen their professional development offerings so that educators get the support they need to help their students improve. This sounds really good, but let’s consider the results. According to… Read more »
Okay, I feel somewhat the same simply because I’m a taxpayer, but where are we going to find literally tens of thousands of ready-to-go new teachers who are going to be reasonably guaranteed to improve those dismal statistics? Personally, I don’t think they are out there! Why students are not learning at high levels is a systemic issue in probably 90% of America’s public school districts. There are likely numerous reasons for with a great many beyond the teachers’ immediate control. For example, Asian cultures are clearly into education as a way of personal advancement, and America by and large… Read more »
Our education system has been a systemic failure for such a long time. It will take a long time to fix it, but only if lots and lots of parents demand changes. Loudoun County VA is making a difference and good for them. That determination needs to blossom everywhere, but I don’t see that happening. Too much resistance from those who benefit from the status quo. Thank you, James, for the dialogue.
J, the people here like to complain. It’s just the way it is. They will tell you that teachers have it easy and they are overpaid. Yet none of them want to go work this “easy” job that’s overpaid. They would rather use their time complaining about taxes than taking one of these jobs that provides all the riches that you enjoy.
Don’t stop them from complaining. That’s all most of them have.
I hear ya. Downstate teachers do indeed get screwed on pensions. I always felt that pensioners on the top end of the scale should redistribute some of their pension wealth to the lower tiers. Alas, the teachers unions feet otherwise. For the record, I never consider teachers overpaid babysitters. Nor have I ever stated the job was easy. But it is voluntary. For such a horrible job, teachers have the lowest job turnover of any profession. If it’s so bad, why do they all stick around? I worked SS jobs … but I will never collect WEP and GPO exist… Read more »
You should talk to a nurse and see who is better off. Nurses cannot work 20 years and collect what you do. Nurses have to pay into their own (at-risk, NOT guaranteed) pension accounts. Nurses work all summer. Your contractually guaranteed hourly limits are around 5/8 that of nurses receiving similar salaries. Nurses have to pay that 6.2% of gross income (SocSec withholding) every single year that you never were required to do. You think you have it bad? How much more are YOU willing to pay in taxes so that nurses can have a fraction of what YOU get?… Read more »
FYI, Ellen Correll is also receiving a pension from the State of NY for her time there. I would assume her husband is as well.
State Rep Wherli fromNaperville passed legislation prohibiting police and fire personnel from taking a pension and participating in a second government pension. He overlooked educators because his wife is an educational administrator.
The real double dippers are the ones who pay into both SS and state pension at the same time and are not penalized by WEP. These are people in states outside of Illinois. The only problem with the part time work after retirement is that it really favors people who had high salaries because the actual criteria for work is not ‘part time half a year’ as you state but ‘not earning more than 80% of your retirement check’. This leaves those of us with pitiful retirement checks also unable to get part time work to get above poverty level.… Read more »
If you PAY into social security and PAY into your pension system, how is that double dipping? If you are working enough hours to PAY into both, you should receive both. I think some people don’t realize that teachers contribute significantly to their own pension plan. And if they have worked jobs paying into social security as well, why should that money be absorbed? The problem identified in this article is over the top and does such a disservice to the average teacher who worked hard to get a modest pension. People always want to focus on these egregious examples,… Read more »
Putting words in caps doesn’t make the fact that teachers do not PAY a significant portion of their pension. It’s the reason we have such a problem with educators taking advantage of the system. Just using this example,. Ellen is set to make over 2 million dollars in pension paid benefits with only 15 yrs of service. If your paying even 10 percent, which she did not, of a 100k salary, over 15 yrs that’s 150,000. tax payers are paying on avg 30 percent of every teachers salary per yr towards their pension. please Explain the numbers how paying less… Read more »
The IL public employee pension systems generally have been designed as a three-legged stool for their financial support. The first leg is money deducted from the paychecks of active employees who presumably will ultimately be its beneficiaries, money from any increases in assets of the pension funds due to investment growths and revenue from the state’s general fund and/or its borrowing capacity where the first two legs mentioned do not provide enough income to meet the beneficiaries’ annual pensions. What you are suggesting in the way of 401k plans for active employees would obliterate the first of the three support… Read more »
Factually inaccurate to state that teachers contribute much to their own pensions accounts. Taxpayers not only pay for teachers contributions, taxpayers must pay additional federal taxes for those ‘pickup’ payments! In Woodstock D200, teachers pay 1% out of required 9%: that equates to 11% of the total input (the rest is euphemistically titled “taxpayer pickup”). Nurses on the other hand: pay 100% of their own 401k contribution, which can be matched by employer (with a cap). pay 6.2% of their own gross wages into social security which starts age 67, pays ~1/3 of what teachers may begin collecting at age… Read more »
It would be interesting to hear about some average teachers…and why Illinois pensions don’t allow retirees to accrue Social Security! Please report on that!
Illinois, along with a number of other states, opted out of Social Security decades ago. Teachers should be thankful.
The Windfall Elimination Provision (WEP) was put in place so that teachers receiving a pension don’t receive higher social security benefits than they would have otherwise.
Any retiree receiving a public pension and having accrued multi-decades of SS credit through a 2nd job receives a severe reduction in his eventual SS retirement income where roughly 45% is not at all uncommon. That’s a bit understandable—even if not all that agreeable—if you read the rules that apply, but no such person receives any rebate for the SS wage deductions he was paying all those years either which makes it even more repugnant.
Ohhh. I’m holding back the tears!
Good, I have at least one sympathizer here. I feel so much better.
more like 60% reduction in social security. my grand total of SURS and SSA leaves me below poverty level at 13k year. All because I worked in different states across my career and was denied to pay in to SSA by two states.
I agree I will never draw SS and I and my wife paid into all are lives, I draw RRB and when I reach the age for SS benefits if I choose to draw it for every 2 dollars I take in I have to give back 1 dollar to RRB why would I do that and the same applies to my wife all that money gone.
James – What percentage of your theoretical retiree’s career earnings were pensionable vs straight up Social Security? Because I’m not gonna cry over a SS reduction for what turned out to be someone’s job during college and summer breaks or selling some real estate on the side. The truth is, many of those receiving public pensions were on the side of the earnings scale where you get diminishing returns from social security anyways. And that “severe reduction” only looks severe because when SS looks at that person’s lifetime earnings, the system doesn’t see “teacher with pension + low paid bag… Read more »
I really fully understand your first sentence and likely would have to respond by making a best-effort guess. Suffice it to say I know the rules and likely was treated fairly by them. I have some mild sense that’s not really as as it might be because I had something like 25-or-so years’ worth of SS deduction but all were at wages below what they call “significant earnings” or some such term. At the present time “significant earnings” is something like $25,000 per year. For any year your employment earnings under SS exceeds that figure a lesser penalty is allowed… Read more »
Social security?….The Average teacher pension dwarfs any S.S. benefits…To collect S.S. you have to be 67 to start….A full teacher pension can start at 58. Nine years into your pension you’ve almost increased your pension by 50%…..You want the crumbs to go along with your Lottery ticket?…..Entitlement mentality.
I did the work and am entitled to SS but at a greatly reduced rate. As I said, I do understand the logic of the reduced benefit level. The penalty still seems excessive to me and especially so since I paid the full-freight of a SS deduction with each paycheck, so that part of it seems confiscatory to me. I’ll get along nicely enough either way. You can say I have an entltled mentality and many will agree. Here I can only wish I had an actual SS entitlement to match. Mine is a pittance as is the case for… Read more »
Or those of us who worked in different states during our careers. Each state deciding its own rules for what retirement you get to pay in to. Then you are penalized by both. As you mention, not enough credit in any one system for much of anything. I get a whopping 13k a year between both state pension and SSA.
James I am one of those that changed careers at 40. I went back to school and got two master degrees so I could be a school counselor. I graduate in May with the second masters and just found out about the WEP and GPO. I had 25+ years paid into ss. Now if I stay in public school I will never get all of my ss I paid into and I will not get all my pension. There is such a shortage of teachers in the first place, with these laws very few will change careers or go into… Read more »
Yes, your career-change will cost you “biggly” in your retirement years and any surviving spouse as well. You might want to change your mind about that and simply either press on in the job you’ve had or seek another job in private employment where the pension penalties won’t happen later. Sorry to burst your bubble, but that’s the down-and-dirty side of your elder retired years in your present work scenario.
I feel so wealthy with my combined SSA and Illinois pension of 13k a year now that you put it that way. NOT.
And folks forget that the employER portion of what would have been the Social Security match is already baked in the gross wages paid. In other words, if teachers had to participate in social security, not only would they have to pay 6.2% out of their own pockets, but their gross wages would also be 6.2% less.
There is a common fallacy that school districts save money because teachers don’t participate in SS. Wrong. That “savings” is already baked into their compensation package.
Not liking this scenario, right? How come some of you writing here think it’s too early to start talking about Amendment 1 and doing everything to stop it? If it passes, we will be forced to endure more of these situations. We already go to work everyday just to pay their pensions. Most of our real estate taxes pay pensions. The extra taxes on outrageously expensive gas is paying their pensions. Do you really think we need more unions and more pensions? Start fighting Amendment 1 NOW even though it won’t be on the ballot till November. It is not… Read more »
Marie, too early to start, in my opinion, because the half life of the average voter’s memory is maybe 60 days. Plus, the oxygen is getting sucked out of all debate right now because of other big stories like Ukraine. Don’ worry, we will be all over Amendment 1. We know how bad it is.
Speaking of the Ukraine I heard Biden say today that while the USA will ban Russian gas imports the Europeans won’t have to. How about that? American’s will have to pay more at the pump to support some European country while other European countries won’t. Democrat’s are never happy unless they are hurting their own country.
Each country is sovereign and, therefore, can decide how they wish to deal with that topic. Believe it or not, Pres. Biden can’t “require” any action he might wish they’d take. Thus, he said the simple truth and no more: they “won’t have to.”
Biden has the ability to hold European countries feet to the fire. The US continues to provide strategic defense coverage in that part of the world. He should be exerting extreme pressure, but frankly he isn’t up to the challenge. It has been one disaster after another since he took office.
He has the ability to persuade, of course. He also can decide a set of priorities for how and where to be foceful in doing so. Also, don’t forget that European countries are much more dependent upon Soviet oil than is the U. S. So, for them its a much, much greater thing to ponder. They can cut-off Russian oil imports but not without a much greater effect on them than it has on us.
Almost like it’s intentional
Many European nations as compared to the United States receive a greater percentage of their oil from Russia.
Some of the European nations such as Germany are more heavily invested into Green energy than than US.
Even Elon Musk the founder of Tesla electric vehicles stated the US needs to to produce more oil and natural gas now.
Riverbender, I think that decision was entirely political, too, not rational. I am very surprised at how sanguine many Americans are about the Ukraine mess. It is extraordinarily dangerous. I don’t claim to have all the answers on what we are doing, but I know that reason not politics should be in charge, and the administration is incompetent (as shown most recently by the fiasco over Polish aircraft).
Perhaps a monthly or bi-monthly series of 1 page fact sheets. That would be 9 or 5 fact sheets by the November 8, 2021 election. Here is the two sentence union constitutional amendment: “Employees shall have the fundamental right to organize and to bargain collectively through representatives of their own choosing for the purpose of negotiating wages, hours, and working conditions, and to protect their economic welfare and safety at work. No law shall be passed that interferes with, negates, or diminishes the right of employees to organize and bargain collectively over their wages, hours, and other terms and… Read more »
Please stop telling the residents of Illinois we’re not intelligent enough to get into this debate now because it’s too early and we will forget about it come the end of summer? Look at the pension crisis in Illinois, it’s already too late. We’re paying the pension price everyday, we don’t forget. More unions, more pensions. It’s that simple. It’s never too early to explain why that’s a BIG problem.
There are 2 monopsonies in Illinois (one buyer: “the State”, which controls licensure and fixed third-party-payment): Education and Healthcare. If pro-public-entitlement comment arguments hold up for Education, and Illinois agrees that these entitlements are meritorious, then let’s apply these to Healthcare. There aren’t an infinite pool of other-regions’ naive nurses poachable. Naive nurses transplanted to Illinois soon learn their lives will be easier, less risky, and more highly compensated by becoming teachers. (After 20 of 2/3-as-many-hours work years, age 58, retire with at least $60,000/year forever, increasing annually. Plus free health insurance forever at age 58.). But I can just… Read more »
What’s the point – no one in Illinois with any authority to change the status quo seems to care.
FYI ISBE’s EIS database is not pensionable income.
One can submit a FOIA request to TRS for pensionable income.
Or one can submit a FOIA request to the school district for the income they report to TRS for a given person or whatever information is desired (range of people, totals, etc.).
Likewise the teacher income reported on school district websites is generally the same as the EIS database and is likewise also less than pensionable income.
Some districts post more fields of information on their websites than what the state mandates.
Most superintendent contracts also stipulate that the school district pick up the superintendent’s pension contribution.
I’m surprised that you “smart” people don’t understand economics. It’s called supply and demand. Who in their right mind would be a teacher or a police officer in IL. Schools are hiring what they legally have to have…A superintendent. There aren’t many qualified people to do this job and many that are don’t even want the job anymore. If you want schools to run they need a CEO. It amazes me that you have no concept of what these people do. They have hundreds of employees to deal with and work with millions of dollars. Most corporations that have this… Read more »
A million dollars for a small elementary district Superintendent or even CPS? That’s nuts. As for larger districts, many (most?) of those superintendents are constantly meeting with the teacher union president and talking to school board members and other special interests including vendors, consultants, and their PR person and the result is the taxpayers and parents are largely left in the dark on what goes on behind scenes. And then there’s the conferences and luncheons. They are well compensated in the Chicago area although the politics can be a real pain. The degree of difficult varies greatly and depends on… Read more »
Compel every taxpayer to buy my employer’s product and I will definitely share my salary. Wait to you see the bonus I get as a result.
A superintendent is often the best politician who rises out of a crop of mediocre teachers. A glad-hander and baby-kisser at best, in most cases. The worst ones (most) think they are God’s gift to education, and since they were mediocre teachers, they could never have made it as private sector execs. Thus, they have a crippling sense of penis envy, which is only ameliorated by making his/her teachers run around like headless chickens chasing every single new pedagogical strategy that comes along. Remember, as a general rule, the private sector rewards performance, and people rise through the ranks through… Read more »
Boy, you are SO BRIGHT! You have it all figured-out likely without ever having been there and having to do any of that, truly a one-in-a-million kind of brain there.
Sarcasm does not become you, young James, especially when you are so off base. FYI, I have been there … 25 years in CPS, as a conservative, so that’s like the dog years equivalent of 67 years in any other district. I’ve been through multiple changes at many levels of administration (because CPS has never met a management layer it didn’t embrace), and have met many of these lukewarm brain pans. In my numerous years, I have also been fortunate enough to get to know teachers, administrators, AND superintendents from other districts. I’m pretty secure in my assessment. I could… Read more »
Well, I have to admit I was wrong about you and apologize to you for it. Still, I think its reasonably safe to say the rules at play for how CPS operates on a day-to-day basis are likely a bit unique as are the qualifiers for employment as its decision makers. Your criticisms cast a wider net than your experience might be said to reasonably allow. You make such emphatic, opinionated generalizations as if your experience were much wider. I think its incumbent upon you to give a caveat to that effect when doing so. Otherwise, how is any reader… Read more »
Or cronyism, high up people, helping other high ups. Let the rest of us eat cake.
Illinois needs to start first thing with FORCED school consolidations.
We don’t need (or want) Chicago or Elgin size school districts but if you
have 2 schools like in Roselle and 2 schools in Medinah a rock throw away it’s time for force them to consolidate and loose a WHOLE lot of overhead costs. Downstate could be more of a challenge due to area but I’m sure a plan could be worked out some may have to be left alone.
There are plenty of downstate districts that need consolidated in the Metro East where some individual grade schools are in their one little district.
Unfortunately, the more costly labor contracts often carryover in consolidation.
We’ve covered this topic already a few months ago. The financial savings during school district consolidations generally are much smaller than one might predict. First, the school district(s) with the lower teacher pay scales typically are granted the same pay scale as that of the highest-pay school former school district and probably with a bump as a COLA for the first year of the new contract. Secondly, the larger school district generally generally absorbs maybe 2/3 or so of the administrators from the former school school districts with the new superintedent having a larger central office staff. The ones more… Read more »
My enduring question has been: why was the pension amendment added to the IL constitution in the first place? When I posed this question to a long-time friend, I was told that the state wanted to access the pension funds and the unions not trusting the state to return the ‘borrowed’ funds required the amendment guaranteeing that pensions could never be diminished. Thus, the amendment. If you ‘big picture’ this, the state has been ‘borrowing’ from the pension obligation by regularly underfunding. Can anyone confirm or refute this story? Thanks! And on to the topic at hand – double dipping.… Read more »
There seems to have been two primary motivations to add the pension sentence to the state constitution. Since it was 50 years ago who knows the real behind the scenes reasons. The public sector employees wanted an assurance the pensions would be fully paid since many of the funds were severely underfunded. Next, once benefits are hiked, they cannot be diminished or impaired for employees enrolled in a pension fund. That creates all sorts of problems. There were legislative benefit hikes in 1971 and just about every year since then. A law can be passed to diminish or impair benefits… Read more »
I question the mentoring program in the public sector. Seems like not many higher ups are prepared to take the big chair. You see this in law enforcement as well when a village keeps the retired police chief on as a consultant. No one ever seems ready for the big time. We keep recycling the same retreads.
That’s one way of looknig at it, but I’d bet the various boards who made the hiring decision would say they picked the best among the applicants available. “Retreads” to one person can be “highly experienced” to another. It depends to a good degree on much time you are willing to give a newbie to learn the job before declaring him truly a good fit or a disaster. To use a military term here; we generally want a leader who can hit the ground running. Newbies aren’t going to be able to do that as quickly,
The “newbies” often work for decades either in that sector or for that employer and have years of experience at the level that reports up to the head honcho.
Again…mentoring.
Sure, it can work well and often does. Still, the mentoring process has to be ongoing and patient, things sometimes missing in action. Let me just say again that if the board making such hiring wants immediacy of action hiring someone with considerable experience is the better choice. Thus, we get the “retreads” being appointed as some may choose to characterize the former school superintendents or former CEOs of the private sector. As always, consumer beware.
The most ridiculous part of this story is that Skokie has a school district with a decimal point.
I like your attention to details, nixit. I looked them up. There are only six other “1/2” districts in the state – Chicago Ridge, Hazel Crest, Rhodes, River Grove, Westchester and Posen-Robbins. Why is this? The common thread seems to be 2-3 schools with grades K/pre-K through middle. However, River Grove and Rhodes are in the same town and they each operate only one school. Someone needs to convince me that we shouldn’t consolidate school districts. What a waste of taxpayer money.
Skokie is covered by EIGHT grade-school districts.
Evanston CCSD 65, Golf ESD 67, Skokie SD 68, Skokie SD 69, Morton Grove SD 70, Fairview SD 72, East Prairie SD 73, Skokie SD 73.5
Employee is told that if they work for 34 years they will max out their pension and can start collecting it. Employee meets their end of the contract and begins collecting their contractually guaranteed pension payments. They also decide that sitting on a beach all day isn’t for them so they decide to continue to exchange their knowledge and labor for a wage. Oh the horror. How dare these people continue to believe they have free will and can continue to be part of the workforce. It’s like they believe they have a right to their own money and time.… Read more »
35 years of service which often means 33 years worked since one can exchange 2 years of service credit (up to 360 unused sick days) for 2 years worked. There is also an age requirement of 55 or so. Perhaps other rules. The following is one of many scams. During annual budgeting, the state put more in the salary budget and less in the pension budget. That hiked the salary which hikes the pension payout. That also underfunded the pension which hikes the taxpayer cost because 100% of cost to finance underfunded pensions (pension interest) comes from taxpayers. Think compound… Read more »
“The following is one of many scams. During annual budgeting, the state put more in the salary budget and less in the pension budget. That hiked the salary which hikes the pension payout.” Salaries are determined by the local school boards save for the fact that the state has a mimimum allowable salary for new teachers. Maybe your sentences make some sense with a little more explanation, but given the response I’m making here I clearly think you are wrong as regards teacher salaries. State government and maybe some local government salaries are another matter, but that’s not relevant as… Read more »
Yes local school boards approve collective bargaining agreements which have teacher salaries and stipends, and they approve administrator contracts which have salaries and perks. What is the source of revenue to pay the salaries, stipends, and perks? One source is the state government. Included in the annual state budget was General State Aid (GSA) and is it’s replacement. GSA went to local school districts, and its replacement goes to local districts. GSA / it’s replacement is one source of revenue for teacher and administrator salaries. Property tax rich school districts received proportionately less GSA and it’s replacement. Property tax poor… Read more »
What you are missing here and I think is a much simpler explanation is as follows. Yes, salaries are determined at the local level, as they should be. Pensions have two different types of contributions, employer and employee. For TRS, the employer contribution is the state, not the local school district. This is a horrible way to run a pension system. The local school board can give outrageous raises and foist the corresponding employer contribution on to the state. There is no responsibility or accountability on the local school board. What else makes this a horrible way to run a… Read more »
Yep, the financial obligation for teacher salaries is primariy at the local school district level while the payment for teacher pensions falls on salary deductions from active teachers, income generated by the pension system investments (two things you failed to mention as I recall it at least), the state’s general fund where the other two resources fall short, from the pension system’s assets as something of a next-to-last source, and utimately from the state’s taxing and borrowing resources more generally if needed. I also think there is something like a 0.5% annual funding of the local school district’s payroll toward… Read more »
TRS and the state screwed the pooch when they didn’t force local school districts to fund pensions above a certain amount upfront. For example, the state would provide the employer contribution for all salaries up to $80,000 but the local school districts are on the hook for the remainder. This would have forced the locals to re-evaluate the top end of the salary schedule, would most definitely put downward pressure on those salaries, and improved pension funding in the long run. Locals should be held more accountable for pensions, but the teacher unions will never allow it. They want the… Read more »
I think you you have a good idea, here.
More scamming so called educators. Teachers unions equal the Mafia.
Now, really which person is likely more qualified, the one with considerable experience or the newbie? Take a wild guess.
Retirement benefits are intended to replace income when a person stops working. They are analogous to death benefits payable to a beneficiary when a person dies or health benefits (when a person is sick) or homeowners insurance payable when a person’s house burns down. These types of protection are heavily subsidized by the employer and are based on risk sharing actuarial principles. Generally (within Illinois) a person who restarts work has his/her pension suspended. Loopholes have been discovered, of course. What you have here is “double dipping,” questionable from both an economic and a moral standpoint. The fact that it’s… Read more »
What’s moral or immoral isn’t a fixed set of conditions with the exception of religious teachings, perhaps. I don’t recall an 11th commandment denying a retiree from taking another job, do you? I think maybe its your own 11th commandment.
The problem has become that the “promises” can’t be kept without bailouts and bailouts contribute to inflation. We have witnessed both with COVID funds going to pension trusts and the inflation already outstripping COLA. The funded ratio of pension systems has resumed its downward trajectory with the stock markets doing a U-turn due to both inflation and Ukraine. For many years, pension law required actual retirement to trigger PENSION payment. The principle started with Social Security and as private sector pensions expanded as a result of WW2 wage controls, the same rule was observed. Employers began to pay pensions as… Read more »
FWIW PBGC severely underfunded plans received a COVID lifeline but longer term problems remain.
https://www.americanactionforum.org/insight/the-american-rescue-plan-multiemployer-pension-bailouts-and-the-pbgc
That’s the PBGC partial bailout for Multi-employer plans such as Teamsters. Private sector plans (other than multi-employer) are still way under-water at PBGC.
Well said, but the problems are still increasing. A noteworthy case in point is that once a person reaches “full retirement” age as defined by the Social Security rules he is entitled to that monthly payment while still being employed and with no reduction in such payments. Actually, that contined employment may even bring about a rise in his SS payment. It didn’t used to be that way. So, the “problem” has now made its way into private sector retirements as well. I know a few farmers who do that partly to keep buying their $65,000 pickup trucks as a… Read more »
“Loopholes have been discovered, of course” There is no loophole. The law was designed so that pensioners could still trade their labor with the state but just for fewer days. What you call a loophole is an actual law working as intended. If you don’t like it then you can lobby to have it changed. I’m assuming WP would like the law to change as well. However, this type of law wouldn’t save one dime for the state so not sure it will ever be much of a priority. If anything, with the expected teacher shortages, I would expect the… Read more »
There are hundreds of loopholes in the Illinois Pension Code which is a massive scam. Pension rules should be predictable and stable, not constantly evolving every year in this or that pension system just to satisfy a special interest at little to zero political cost. Hardly anyone cared about taxpayer cost. The canaries almost rarer than dodo birds were easily marginalized and outmatched with overwhelming money and manpower largely from public sector unions whose funding obviously originates from taxpayers one way or another. Illinois has more pension systems than any state or just about any state, each with its own… Read more »
“Pension rules should be predictable and stable”
The Illinois constitution agrees with you. That’s why the clause was added to ensure that pensioners would receive at least what was offered to them on their first day of employment. They wanted to make sure that political winds wouldn’t cause pensions to be stolen at the end of their career or worse once retired.
It’s stable for the pensioners, as intended.
The Illinois Constitution does not address how often laws can be passed to hike pension benefits. Here is the pension sentence that was added on December 15, 1970: “Membership in any pension or retirement system of the State, or any unit of local government or school district, or any agency or instrumentality thereof, shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired.” Here are a few problems with that pension sentence and the State Constitution as it pertains to state and local public sector pensions in Illinois, and what has ensued since the… Read more »
The IMRF pensions are fully funded because at its creation or soon thereafter that became the law. No other IL public pension fund is required to meet that requirement. Thus, when an IL governor says he has “fully funded” a particular pension system he only has to meet the politically agreed level of funding rather than the actuarial level common sense would indicate. Consequently, the underfunding grows nearly every year as more interest accrues on the increasing debt level.
IMRF is not fully funded for all employers. IMRF funding status varies by employer. IMRF has a document on its website that indicates the funding status of each employer. Also the funding status of any give employer can be found in the CAFR / audit report of the employer, which is on the employers website. ”Fully funded” as I have been using the term refers not to the annual employer or state contribution to the pension fund, but the overall funding status of the fund. Sleazy governments, slimy unions and clueless or complicit press for decades have been playing the… Read more »
Typo. Intended to enter December 15, 1970 not December 15, 1980. That being the infamous day that voters approved the rewritten Illinois state constitution. The assault on hiking pension benefits to underfunded pensions escalated beginning in 1971 and incredibly still occurred in 2021. The 50 year benefit hikes to underfunded pension and retiree healthcare funds war on Illinois taxpayers. What is an analogy? The state has not paid its monthly credit card bill in full once in 50 years, and furthermore has continued to charge more to the very same card. In other words a Ponzi scheme with massive pension… Read more »
It’s a cynical deal in every sector — buying votes for legislators and judges. Beneficiaries of the deal include public safety, U.S. military, legislators in states and the federal government AND YES people on Social Security. Stateside soldiers who did push-ups get the same benefits (PX and pensions and health care) as combat veterans on the theory that they all put their lives on the line. A few people perhaps “deserve” pension improvements based on hardships suffered on their jobs. Police plans, for example, have generally provided or “duty disability” benefits. A problem is that these provisions have spawned an… Read more »
“It’s stable for the pensioners, as intended.”
It is not stable for taxpayers, also as intended?
Taxpayer Servants not Public Servants?
What about the financial stability of the state or quality of state and local government services?
Who cares, as long as pensions are paid first.
There is a sucker born every minute.
A severely underfunded set of pension funds is NOT stable for the pensioners. One might confidently prophesy that the taxpayers will bail them out. But if that’s such an expedient solution, why hasn’t it been done? Because it’s Illinois’ political third rail. No politician will suggest a multi-thousand dollar, multi-year spike in real estate or income taxes (or both) to increase funding. Instead, the can is kicked down the road. Eventually, the host will be consumed by the cancer unless the cancer is removed. The constitution will be amended by the taxpayers because they will be unwilling to bear the… Read more »
All it takes is a team of Harvard Law grads to make mincemeat out of a constitution. Nothing there can be be considered permanently predictable. Words can be sliced and diced to have new meanings. The words may stay the same, but the meanings over time can change.
No Harvard Law grads on the Illinois Supreme Court. Second and Third Tier law schools. That doesn’t necessarily mean they are hacks, but it may say something about their basic work ethic. Having to run for office means you need to play to the unions if you expect to win and, like as not, they make more as judges than they could toiling on LaSalle St. — even if they could get an interview there. I doubt there is any evidence that they took bribes or traveled with J. Epstein. This sets them apart from The Dersh — who studied… Read more »
What do you call a group of lawyers found drowned, lying at the bottom of a pool? A good start.
There are so many more.