Should local schools pay for teachers' pensions?

Posted2/25/2011 6:00 AM

SPRINGFIELD -- Senate President John Cullerton wants suburban school districts to pay more into teachers' retirement plans, an idea that makes cash-strapped districts nervous.

Shifting the responsibility to pay for educators' pensions to schools would save the state millions of dollars every year. But the additional costs locally could mean bigger class sizes, fewer teachers on staff and cuts to programs.


Elgin Area School District U-46 spokesman Tony Sanders said he doesn't know how his district would handle Cullerton's idea if it became law, especially without knowing many details. But when costs go up, something has to give.

"Essentially, you have to find reductions in other areas," he said.

Now, local teachers pay 9.4 percent of their salaries toward their pensions. Local districts pay less than 1 percent. Last fiscal year, the state paid about $2.1 billion.

School districts wouldn't be on the hook for that entire $2.1 billion, under the Chicago Democrat's plan.

Cullerton said the state would continue to pay the pension debt that's accumulated over years of skipped payments into the retirement plans. Local districts would pick up the cost of a teacher's future pension, and the increased cost to schools could be phased in over several years.

Chicago Public Schools already pay into teachers' pensions with relatively little help from the state, but suburban schools get help from all the state's taxpayers, he said.

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"The suburban and downstate teachers already contribute substantially to their retirements, as do the taxpayers of Illinois," Cullerton said. "If the school boards that oversee school districts are going to effectively decide pensions by deciding salaries, then they too need to contribute substantially."

The Chicago Democrat's plan is still just an idea. And any legislation to make it law could face staunch opposition from local school boards.

"It's going to be devastating," said Ben Schwarm, associated executive director of the Lombard-based Illinois Association of School Boards.

The Illinois Federation of Teachers remain open to the idea, though, depending on the details. Spokesman Dave Comerford said new pension rules adopted last year could greatly reduce the impact on local schools because new teachers hired this year and beyond will receive less generous pensions.

"It's not something that we're going to dismiss out of hand," Comerford said.

Pension plans for state workers, teachers and others are a major issue in Illinois' budget problems. Some lawmakers have called for cuts to pension benefits that current workers would earn for their future work.

Unions and Cullerton, though, have argued that such changes would be unconstitutional.