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Pension-reform Drum Beats Louder in Elmhurst District 205 Officials' Ear

Shifting pension funding from the state to local school districts is gaining traction—and support of some Republicans—but Elmhurst school officials say the plan would cripple public education.

A proposal that would shift the burden of teacher pension costs from the state income tax payer to the local property tax payer is gaining traction in the Illinois General Assembly, according to an article in the Daily Herald Tuesday.

Republican lawmakers traditionally have strongly opposed such legislation, however the Herald is reporting two Republicans, Rep. Chris Nybo of Elmhurst and David Harris of Arlington Heights, seem to be getting behind the idea.

Democratic Rep. Elaine Nekritz of Northbrook, chairman of the House Pension Committee, has put forth a plan that would phase-in the costs to local school districts and require teachers and state workers to pay more into their retirement.

Elmhurst District 205 School Board officials have said repeatedly that any plan to shift the pension burden to local school districts would cripple public education by forcing major budget cuts. Officials say any cuts on top of the $1.2 million cut this year and the $3 million cut the previous year will dramatically change public education as we know it; programs would have to be eliminated and class sizes would grow.

Some state legislators have said the local districts have been too lenient in negotiating their teacher contracts and that having them pay the pension obligation would force them to hold the line on pension increases.

Of the state lawmakers who will be debating Nekritz's plan, more than 30 will be leaving the House and Senate on Jan. 9 when the new legislature is sworn in.

Rep. Nybo is one of those lame duck legislators. He lost his bid for an Illinois Senate seat in the 24th District to Sen. Kirk Dillard of Hinsdale in the Primary Election last March and is headed back to work in the private sector as an attorney.

Nybo was quoted in the Herald article as saying it would be a "travesty" not to settle the pension issue once and for all before the new General Assembly is seated.

ConcernedElhmhurstTaxpayer December 05, 2012 at 10:54 AM
Public pensions have to be reduced somehow. You can't keep paying these high pensions - there has to be some reductions. Taxpayers can't be saddled with this mess. I thought the 67% increase in state income taxes for individuals was supposed to solve that problem. this is when the IL income tax went from 3% to 5%, where in the hell did all that money go! We need a tax revolt started in IL, property taxes are way too high, Income taxes are too high, some states do not even have an income tax for individuals. when will this stop! Taxpayers - organize and revolt against this corruption and thiefery.
Ken December 05, 2012 at 12:58 PM
Teachers are overpaid and over compensated with benefits. It's time to eliminate all pensions for new hires and to have current employees contribute more to their retirement funds.
Scott December 05, 2012 at 01:08 PM
There were reasons I didn't vote for Nybo and actions like this reaffirm my decision. Yes, it is time to solve the problem, but not by just shifting the problem to the local level. Fundamental changes in benefits are needed and transferring the issue to the school district level does nothing to address that. The state legislators created the problem and they should resolve it. We are so fortunate Nybo lost his election. Good riddance.
Jim Court December 05, 2012 at 02:01 PM
Who is really overpaid are entertainers, celebrities, and athletes. They reflect the superficial values we have embraced as a society. In the larger scheme of things, none of the above really matters. What are we running from that we need to constantly "escape" Yes, I enjoy music and a good movie but do I think that they add more value to our society than social workers, teachers, and those who serve the NEEDS of others? Hardly. Yet, they are rewarded disproportionately. Wages are declining, people are struggling. I believe our society has its priorities backwards. I am sure this will offend many but I will never be guided by the lowest common denominator way of thinking.
Dan December 05, 2012 at 02:07 PM
While they are talking about shifting pensions to the local districts are they also talking about setting a minimum percentage of the local school districts budget that must be covered by the state? The state provides less than 7% of the funds for district 205. Why isn't there any talk about requiring Illinois to fund a larger portion of the local school district budget?
Wash Woman December 05, 2012 at 02:40 PM
Teachers are a unionized white collar educated profession w/ a pension guaranteed by law. We need to change the law. Teachers need to start paying into social security just like the rest of us. They complain about not being able to collect social security but maybe teachers should think about the taxpayers that can't collect a teacher's pension yet still have to pay for it. The only way out of this pension mess is a constitutional convention. We need to wipe the slate clean, get out from under this uncontrollable burden, and start fresh. The con-con vote in 2008 was a missed opportunity. We now have to wait until 2028. Illinois will be bankrupt by then.
Ken December 05, 2012 at 02:58 PM
Entertainers are overpaid but you have the option of not supporting this by staying away from their performances. Not so with teachers or government workers. Most teachers with any longevity and a masters degree will be getting close to a 6 figure yearly pension PLUS medical. My tax dollars pay for this. I receive no pension and my social security will be around $20000 a year. Time for them to be just like the rest of us poor slobs.
ConcernedElhmhurstTaxpayer December 05, 2012 at 03:31 PM
The law needs to be adjusted, why should teachers get all these benefits like lifelong medical benefits and a pension that skyrockets every year? change the laws, does Nybo have a backbone, enough is enough ............. Taxpayers are sick of over compensated teachers who really are at some levels, overpaid baby sitters, Give me a break, how hard is it to teach children. This has become out of hand. ........ The last time that had a con con in 69, the fat cat reps. & senators voted a State of IL income tax. WE never had it in the great state of IL until 1970. Lots of States do not have this tax. DuPage taxes are absurd and we need to lower this amount. Most school districts including Elm. have alot of waste and teachers are overpaid.
Timothy Manders December 05, 2012 at 04:08 PM
Amen!
MIke R December 05, 2012 at 04:11 PM
Maybe we should look at the proposed legislation before we start accusing some people of having no backbone. Looks like Nybo is really trying to do his best in the last 30 days he is there. Here's the summary of the proposed legislation. It appears as though the phase-in of responsibility could be manageable. Let's face it, the suburban local school districts negotiate union contracts individually; however, they do not have direct accountability for the pension cost. Maybe that should change. Here is the summary from the Capitol Fax website: SOURCE: Capitol Fax Website * Cost of living adjustments would apply only to the first $25,000 of a pension if the retiree does not receive Social Security and $20,000 if he or she does. This change applies to both current and future retirees. * Pensioners would receive no COLA adjustment until they reach age 67 or five years after they retire, whichever comes first. The summary says this provision will apply to retirees already receiving COLAs. So an employee who retired at age 58 and is now 60 would not receive another COLA adjustment until age 63. (continued on next comment)
MIke R December 05, 2012 at 04:12 PM
* The retirement age would increase as follows: Retirement ages in the current statute would apply to employees 46 and older. One year would be added to current retirement ages for employees between 40 and 45 years old. Employees age 35 to 39 would have to wait an additional three years. Employees 34 and younger would have to wait an additional five years. * Employee contributions to pensions would go up by 1 percentage point in fiscal year 2014 and 2 percentage points in fiscal year 2015. * The salary that counts toward a pension would be capped at the higher of the Social Security wage base or the employees’ salary when the bill becomes law. […] * School districts, community colleges and universities would take over the state’s pension cost at a rate of 0.5 percent of payroll per year. * Pension systems would achieve 100 percent funding in 30 years. * Courts could force the state, school districts and universities to pay their required pension contributions. “Other state funds” could be intercepted if the payments are not made as required by law. * Once existing pension obligation bonds are paid off, annual bond service funds would be rerouted to pay off broader pension debt — about $694 million starting in fiscal year 2016 and $900 million per year in 2020.
Dan December 05, 2012 at 07:09 PM
So when it was the states responsibility to fund pensions they allowed themselves to legally look the other way and not fund them but once we are locally required to pay them from property tax dollars than they are creating a law that will allow the "courts to force" us to pay them. I love how there is one set of laws when it is the state's responsibility and another when it is the local tax payers responsibility. Let me guess the only way for us to escape these payments no matter how low property values were to drop or incomes were to fall would be to amend the state constitution.
MIke R December 05, 2012 at 07:43 PM
Dan, there is no escaping the fact that the state legislators failed miserably on this issue over the last decades. My view is that something has to be done short of declaring bankruptcy. You're right, it will be the taxpayers who will pay for this one way or the other, because without pension reform, and if pension funding accountability remains with the state, one of three things will happen. 1) the schools will get less state funding so the state has money to pay for the pensions; 2) income taxes will again increase to pay the out-of-control pensions; or 3) BOTH 1 and 2. While this whole matter is disgusting, I tend to lean toward the one where more meaningful control is put in the hands of the voters...and that is with the local school boards. This proposal also emphasizes increasing the employee contribution AND reducing the benefits. I agree though, no easy answer at all. God help the state if the legislators fail to do something.
Scott December 05, 2012 at 09:52 PM
Mike R More complication trying to obfuscate the problem. Also, where is the money going to come from to pay off the bonds. The state is broke, remember???? Freeze the current plans (so everyone receives a pension for the amount of time they've alreadyworked and level of salary they have earned to date - in other words, nobody will loose something they've already earned). Move everyone to a defined contribution plan. Private companies have been doing this for years and that trend continues because private companies realize that defined benefit plans are not sustainable. Well, they aren't sustainable in the public sector either unless the governments soak the taxpayers with taxes at confiscatory rates. It is the only solution that is "fair" to the taxpayers.
Ken December 05, 2012 at 10:49 PM
If the state shifts the mess they created to the local school districts, can the locals then do away with offering pensions to new hires? I'm sure the voters in each district would be in favor of this.
MIke R December 05, 2012 at 11:23 PM
Scott, Your excellent suggestion of a defined contribution program is one that many have advocated. I agree it is best, unfortunately it apparently has not gotten traction in the Illinois Congress. Again, we can complain or, better yet, recommend what we believe to be better solutions, but these solutions are not being offered in bills because the support does not exist. The plan in the article seems to be gaining traction and while it may not be the best solution, it may realistically be the best we can get at this time.
MIke R December 05, 2012 at 11:28 PM
Ken, interesting concept. Not really sure if they could unilaterally as you write "do away with pensions" when negotiating with teacher's collective bargaining units, but you can bet you would have less qualified teacher candidates to choose from.
gary December 12, 2012 at 04:38 AM
100,000 in retirement. I retired a year and a half ago and make 39,000 downstate. Most schools downstate are in big trouble. We don't have the resources you have in the suburbs. We have been operating on shoestring budgets for quite some time now. When I have gone north for inservice,I just shake my head at the things you can afford in your classrooms. We might as well be in a different world. There is a lot more to this issue than what you see up there.

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