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July 6, 2018

Statistics show 87 of Kankakee County’s current and retired educators pulled in six figures last year, with slightly more than half of them pension recipients. In Kankakee School District 111, the county’s biggest district, 16 of the 30 current retired educators are making more than $100,000.

Under state law, government pension recipients get 3 percent compounded increases every year. So if an educator retires and gets an initial pension of $100,000, it will rise to $103,000 in the first year and $134,000 by the 10th.

This is more than double the rate of inflation over the last decade. If a $100,000 salary had increased with inflation since 2008, it would have grown to about $116,000.

Ralph Martire, executive director of the Chicago-based Center for Tax and Budget Accountability, said the misconception is that the state’s growing pension liabilities are a benefits issue. He referred to state figures showing just 46 percent of the state’s pension costs were for pension payouts in 2017. The rest was for debt payments, he said.

From 1996 to 2016, the fourfold increase in unfunded state pension liabilities was mainly attributed to inadequate state contributions and changes in assumptions on the rate of return for pension fund investments, according to an analysis by Martire’s organization. Less than 2 percent was because of benefit and salary increases.

Martire blamed the debt problem on long-term “bipartisan malfeasance” in which lawmakers delayed required contributions to the state pension systems.

“For generations, lawmakers intentionally underfunded pensions to fund current services — education, health care, social services and public safety,” Martire said. “For well over 40 years, taxpayers in Illinois have not paid the full cost of services they consumed. Legislators and governors of both parties simply wrote IOUs to the pension systems.”

Because of the poor decisions, he said, costs grew dramatically.

“If we were just paying for the benefits, the costs would be middling-to-low and entirely affordable,” Martire said.

Source: Daily Journal