Thanks to a loophole created by the Illinois legislature, retired teacher union leaders are getting pension credit for the years they did union work after leaving the classroom. The arrangement has put taxpayers on the hook for millions of dollars in retirement benefits unrelated to teaching, and further drained an already overburdened state pension fund.
Collectively, 40 retired union leaders draw $408,136 per month in Illinois teachers’ retirement pension, or $4.9 million per year, according to data generated at the request of The Washington Times by OpenTheBooks.com, an online portal aggregating 1.3 billion lines of federal, state and local spending records.
Twenty-four of those retired union leaders have already collected more than $1 million each in retirement benefits, and the payments are likely to continue for years to come, the data show.
The union bosses collecting the payouts had jobs at the National Education Association (NEA), the Illinois Education Association (IEA) and the Illinois Federation of Teachers (IFT) after their teaching careers. Most got massive pay raises when they jumped from the classroom to the unions, swelling their pension payouts by large amounts at the expense of taxpayers.
The labor leaders contribute into the state pension program during the time they work for the unions, but their larger salaries are then used to calculate their final retirement eligibility. The result is taxpayers must pay pensions to these leaders that are exponentially larger than if they just continued to teach in the classroom.
The arrangements live on even as the Illinois Teachers Retirement System (TRS) hurdles toward insolvency — it is currently underfunded by an estimated $54 billion — with teachers currently in the classroom questioning what sort of retirement they’ll receive. Right now, the TRS could only afford to pay out 40 cents on the dollar of each retiree it owes.
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“Government pensions should go to government workers, period,” said Adam Andrzejewski, founder of OpenTheBooks.com. “The pension system for the hard-working teacher and public servant is being drained by union bosses with special pension privileges.”
The labor officials are able to collect teacher pensions because of a pension code carve-out granted by the Illinois General Assembly back in 1987 — a change for which the unions lobbied heavily.
Under the pension code, active employees of the IFT and the IEA with previous teaching service can be TRS members. The IFT and IEA have been able to designate employees as active TRS members if they were already TRS members because of previous creditable teaching service. Since the 1940s, the pension code has allowed active employees of the Illinois Association of School Boards with prior TRS creditable service to be active TRS members.
The statutes outlining additional benefits within Illinois state and local pensions have many times “been amended in the state pension code without much public discourse, financial analysis or even justification as to why we should add on nongovernment employees such as municipal associations, unions or anyone else,” said Laurence Msall, president of the Civic Federation, a nonpartisan research organization. “This is the definition of insider benefits that don’t serve identifiable public purpose.”
TRS isn’t the only public pension in Illinois that gives payouts to nongovernment employees, he said. The Chicago Public School system and other municipal pensions have also written into their statutes language allowing nongovernment employees to gain from the public system — even if they’ve worked only a day in the public sector, Mr. Msall said.
In 2012, Illinois Democratic Gov. Pat Quinn signed into law a bill aimed at addressing concerns about private organization employees in TRS, especially those who had not been teachers previously but used a state law to claim past employment service toward their TRS pensions.
The law, however, only forbids members from including any service time with the unions prior to joining TRS in the calculations to determine their TRS pensions, not afterward. In other words, teachers who work in the classroom and then join the union are exempt and can use their union wages to increase their pension payout.
“TRS has a fiduciary duty to administer all state laws regarding benefits as enacted by the General Assembly and the governor,” said Dave Urbanek, spokesman for TRS in an emailed statement to The Washington Times. “Therefore, the System does not comment on or participate in any debate over the appropriateness of any law governing benefits.”
The sixth-highest Illinois teacher pension — $265,152 per year — goes to former National Education Association President Reginald Weaver, who spent the latter half of his career in Washington lobbying for the union and then doing education consulting. Mr. Weaver’s pension was predicated off his union earnings, not just his teacher pay.
Mr. Weaver defends the pension system and his payout as guaranteed by the 1987 law.
“I don’t see where it has been a disadvantage to anyone to have had that legislation passed. There’s not that many people who it affects,” Mr. Weaver said. “The largest teacher pensions are given to the administrators, not those who worked for the union.”
Mr. Weaver said the discussion of TRS’ pending insolvency should be directed at the state, which, for many years, shirked its responsibility to pay its portion of the pension, taking “pension holidays” to fund other priorities.
“Pension reform shouldn’t come on the backs of the people who have contributed to it,” Mr. Weaver said.
The unions have led an effort to stop the pension reform signed into law last year by Gov. Quinn, arguing it strips retirees of benefits promised to them. The bill’s fate now rests in the hands of the Illinois Supreme Court, which will determine if the proposed pension reform is legal under the state’s constitution.
Meanwhile, ex-union officials are still collecting from the pension carve-outs under the law.
Ed Geppert, the former president of the Illinois Federation of Teachers (IFT) is one of those union leaders, according to OpenTheBooks data. Teaching social science at Cahokia High School from 1969 to 1977, Mr. Geppert earned, on average, $12,100 a year. When he started at the union in 1980, he took in a salary of $32,650 and, although no longer teaching, he continued to remain in the TRS system.
By 2004, Mr. Geppert was making $217,000 annually as chief of staff at the union, and continued to contribute to the retirement system. When he decided to retire that same year, he got a $43,000 raise, bumping up his salary to $260,000, and his pension payout, which is based on his four highest consecutive salaries at the union, according to OpenTheBooks.com.
In 2007 Mr. Geppert came out of retirement to become the union’s president. In addition to collecting his union paycheck, he also collected his pension. Today, Mr. Geppert receives $203,076 annually from the pension, plus a 2 percent raise or a cost-of-living adjustment tied to the Consumer Price Index annually, based on whichever is higher, according to OpenTheBooks.com.
Mr. Geppert declined comment, as did the IFT.
Martha Bowman, who taught for 33 years in Marion, Illinois, ended her teaching career on a $62,000 salary. She then went to work for the state’s second-largest teachers union, IEA, for six years, earning $143,500 a year, including a $24,000 boost in her final year — to set her up for a retirement annuity of $109,368 — more than twice what it would’ve been on her teaching service alone, according to OpenTheBooks.com data. Every year, Ms. Bowman receives at least a 3 percent compounded raise on her pension amount, as was guaranteed in her contract.
IEA is the regional branch of the NEA, which declined to comment.
“The NEA does not characterize or discuss the personnel matters of current or former NEA-elected officials,” said NEA spokesman Miguel Gonzalez in an emailed statement to The Times.
Mr. Gonzalez declined to identify the merits of the union carve-out, why it was lobbied for, or if it could be used as a bargaining chip to help return TRS to solvency.
Paying out union officials may not be the leading contributor to TRS’ pending insolvency, but it does speak to the complexity of the political interests and favorable carve-outs that exist within the Illinois pension system, Mr. Msall said.
“It’s indefensible to be providing benefits to nongovernment workers, when the existing pension fund is in danger of insolvency and when existing government employees don’t have the confidence that their pension benefits will be there when they retire,” Mr. Msall said. “Illinois has had a bad history of writing into the pension code benefits for individual employees, who may or may not be government employees, to sweeten their benefits.”