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Retirement fund is all about taxes

The Aug. 18 Fence Post response by Mr. Dick Ingram, executive director of the Teachers’ Retirement System, to a previous Daily Herald article about TRS’ “big pension boosts” for ex-school administrators makes me think he really doesn’t get it. He can write a lengthy article about public employee pensions without ever mentioning taxes. He notes that funding for these retirement benefits comes from “school districts and state governments” like this is some form of free money that appears out of thin air.

Does he understand that we taxpayers are footing the bill for these six-digit pensions for teachers and administrators that many times exceed their salaries prior to retirement? Nonpublic employees don’t get benefits like that, we just have to pay for them. My property tax assessment for the current year includes a charge for my local school district pension cost that has increased 115 percent from last year. I can’t afford much more of that kind of efficiency from the TRS.

Mr. Ingram rejects the idea of a 401(k) approach. Does he realize that defined benefit plans are dinosaurs and have been replaced by individual account plans in almost all organizations except those that can soak the taxpayer for the cost? He says that a 401(k) plan would cost $1 billion per year to administer. I suspect that assumes the plan would be administered in-house by TRS bureaucrats at taxpayer expense. I have no idea what the administration cost of an individual account plan might be, but I am sure that there would be a long line of “outside” professional administrators that would administer the plan at a fraction of the cost that Mr. Ingram would charge us.

Kelley C. Smith

Long Grove