Who should pay pension costs for Illinois teachers and school administrators? Currently, the state bears virtually all the cost, leaving the state’s 852 school districts free to negotiate benefits without worrying about the price tag.
When school districts outside of Chicago negotiate contracts, they do so with the assurance that the state will pick up the tab on pensions. To control growing pension costs, lawmakers capped salary bumps at 6 percent in 2005. This year, the cap tightened to 3 percent.
Illinois' teachers unions have collected more than 15,000 signatures on petitions urging state lawmakers to reverse that measure.
A recent report has shown Illinois is in the midst of a severe teacher shortage, particularly in the central part of the state. A panel of lawmakers took testimony on that topic today.
In the first of a series of such hearings, a committee heard from the agency responsible for licensing teachers, and from various teacher unions. But several lawmakers on the panel are former school teachers, and Rep. Sue Scherer (D-Decatur) wasn't shy about sharing her personal opinion on why the ranks of teachers is dwindling.
The Illinois Teachers Retirement System voted last week to reduce the amount of money it assumes it will make from its investments. The board revised this rate of assumption down to 7 percent from 7.5 percent.
This change means that as lawmakers and the governor are putting together a budget for next fiscal year, they will have to come up with a projected $420 million more than what they might have expected to pay into the retirement system for teachers outside of Chicago. Illinois' total unfunded liability for all its pension funds is pegged at $111 billion.
Schools that serve a large number of low-income children qualify for federal grants, called Title 1. Many schools use that money to provide extra reading and math teachers, to help needy kids catch up with their more privileged peers. But the state of Illinois is increasingly tapping into those funds to pay down the Teachers Retirement System’s pension liability.
The school system losing the most money in this scheme is Springfield’s District 186. So I asked Larry McVey, coordinator of Springfield’s Title 1 programs, to explain how this happened.
The curtains are closing on the Chicago play "I Wish to Apologize to the People of Illinois" -- a timely production, given that today, Dec. 9, marks five years since Rod Blagojevich's arrest. Two trials later, he was convicted on 18 counts of corruption. At Blagojevich's sentencing hearing, the former governor said he was sorry for his mistakes. But Blagojevich was not the one making apologies in this show. He's not even a character -- just someone who gets mentioned now and again.
Illinois' largest public pension fund hit a major low in 2012, its rate of return was less than one percent. But an early analysis shows the last fiscal year was better than expected. The success isn’t expected to make much of a dent in Illinois’ nearly $100 billion dollar pension liability, however, which lawmakers thus far have failed to tackle.