River Forest District 90 will pay 100 percent of teacher pension contributions – were teachers duped?

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Although the agreement described below might sound like a welcome relief to teachers, Gov. Rauner’s Turnaround Agenda pushed a local property tax freeze (pg. 9) and municipal bankruptcy (pg. 12) that may allow local municipalities to declare bankruptcy.

The State Senate passed a 2-year property tax freeze under Senate bills SB482 and SB484.

OPINION: How Gov. Bruce Rauner’s property-tax freeze will hurt your kids

Currently, teachers’ pensions are protected at the State level:

CONCLUSION
For the foregoing reasons, the judgment of the circuit court declaring Public Act 98-599 to be unconstitutional and permanently enjoining its enforcement is affirmed.

The question is whether or not pensions funded locally will continue to be protected under state law if moved to the local level. Current legislation suggests they may not.

HB0298 will amend the Illinois Municipal Code.  In provisions concerning finance, it provides that a municipality may file a petition and exercise powers pursuant to applicable federal bankruptcy law. Effective immediately.

The last action taken on this bill took place 1/10/2017 in the House: Session Sine Die.

HB2575 was introduced in the House on 2/8/2017.

HB2575 creates the Illinois Local Government Protection Authority Act. Provides findings of the General Assembly and establishes the Authority with the purpose of achieving solutions to financial difficulties faced by units of local government. Defines terms and creates a board of trustees. Sets forth the Authority’s duties and powers, including the ability to obtain the unit of local government’s records and to recommend revenue increases. Provides for a petition process, whereby certain entities may petition the Authority to review a unit of local government. Sets forth participation requirements.

Section 35 – Powers

The Authority shall have the power to:

m) Consider and make recommendations to the General

Assembly legislation regarding an economic safety net whereby

the State shall provide a set of fallback post-employment

benefits for employees in the event that a public employer has

not resolved the underfunding of its pension plan and

thereafter is unable to pay its retirees. The program shall use

the federal Pension Benefit Guaranty Corporation* as its model.

Contractual benefits would have to meet affordability tests

prior to being approved for safety net funding. The outcomes of

the affordability tests may result in smaller benefit payments

that were initially promised to the employees by the defaulted

employer.

Section 40 – Petition and criteria

The Authority may exercise its authority over a unit of local government

under this Act, if the Authority is petitioned and the Authority

accepts the participation of the unit of local government

identified in the petition. The Authority has absolute

discretion regarding acceptance or denial of any petition and

participation of a unit of local government. The Authority

shall create rules regarding the petition, procedure, format,

and required documentation.

a) The following parties may petition the Authority:

(1)  the Illinois Comptroller;

(2)  a unit of local government;

(3)  a Significant Past Due Creditor; or

(4)  a pension fund.

If the Illinois Comptroller, a Significant Past Due

Creditor, or a pension fund petitions the Authority, their

petition shall include documentation of the unit of local

government’s approval of the petition and participation.

* The Pension Benefit Guaranty Corporation (PBGC) takes over pension plans.  The termination of a defined-benefit plan is initiated by the employer, either by a standard termination or a distress termination.

Under a standard termination, the employer must demonstrate to the PBGC that there are sufficient assets under the plan to pay all benefits owed under the plan to participants.

A distress termination occurs when the plan is being terminated but there are not sufficient assets under the plan to pay benefits.

Generally, the PBGC steps in to take over the administration of a pension plan when either a distressed termination is initiated by the plan sponsor or the PBGC determines that a plan will be unable to meet its obligations and mandates a takeover.

Distress terminations generally occur in conjunction with bankruptcy, but in most cases, a PBGC mandated takeover is the method by which the entity becomes responsible for a plan.

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Post By: Illinois Policy Institute

RE: Illinois Policy Institute
•  Meet the Little-Known Network Pushing Ideas for Kochs, ALEC
•  Illinois Policy Institute (IPI)
•  State Policy Network (SPN)
•  Conservative Transparency

In the midst of Illinois’ pension crisis, River Forest District 90 has agreed to pay 100 percent of teacher contributions to the Teachers’ Retirement System – and it did so secretly

In Illinois, negotiations between local governments and government workers are done in secret. That’s a problem for taxpayers.

It means residents can be saddled with expensive contract provisions and can’t react until the contract is a done deal. And by then, it’s too late.

The latest example: River Forest District 90. That school district just renewed an agreement to pay 100 percent of teachers’ pensions contributions – the share the teachers are supposed to pay – as an additional benefit.

By law, teachers are obligated to pay 9 percent of their salary into the retirement system. But half of Illinois’ school districts take on that obligation themselves. Instead of having teachers contribute to their own retirement, the school districts agree to pay it for them.

Of course, forcing taxpayers to pay 100 percent of the contribution – while teachers themselves contribute nothing toward their retirement – isn’t the only issue.

A big problem is the secrecy of District 90’s negotiations. Bargaining between the union and school district happened away from public scrutiny. And that means taxpayers couldn’t find out the details of the deal until it was too late.

What’s more, the contract was negotiated under the leadership of School Board President Ralph Martire – whose own organization, the Center for Tax and Budget Accountability, or CTBA, is heavily funded by government unions.

That means taxpayers in District 90 were essentially left without true representation in the negotiation process.

240 Candidates to Run for Lake County School Board Seats

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Undoubtedly, there’s a heightened concern revealed in the record turnout of candidates running for school board positions, myself included.

 

 

Why the sudden interest in school board candidacy?

Interest may be sparked by President Trump’s recent nominee for Education Secretary, Betsy DeVos, who was described in a Washington Post article as, “a former Republican Party chairwoman in Michigan and chair of the pro-school-choice advocacy group American Federation for Children, and a shining light to members of the movement to privatize public education by working to create programs and pass laws that require the use of public funds to pay for private school tuition in the form of vouchers and similar programs.”

Another reason could be  House Bill 229, legislation recently signed by Governor Rauner that grants to the McHenry and Lake County Boards the same consolidation powers as granted to DuPage County three years ago under a pilot program.

Perhaps it’s our governor’s Turnaround Agenda, which also gives more power to local governments along with a proposal that “explicitly authorizes” a municipality’s ability to seek relief under Chapter 9 of the Bankruptcy Code with “no requirements, pre-conditions or other limitations.”

Moving more authority in decision-making over to local school boards isn’t a new conversation.  In a 2013 Daily Herald interview, Kathy Brown, an incumbent running for Lake Zurich Unit District 95 Trustee stated, “The most significant budgetary issue facing our District is the Illinois pension crisis. The shifting of the pension burden to local districts will have a significant financial impact on all school districts.”

Then, of course, there is the federal, state, and local debt problem.  Our Federal government, for example, spent $4.3T on expenses, collected $3.7T in revenue, and carried $18.3T of debt in 2015.  Illinois spent $75B on what should have been a $71B budget addressing $141B of debt.  Lake County paid approximately $405M in expenses, collected $444M in revenue, and carried $247M in debt.  In 2015, 27% of the State budget provided funding for education, and only 2% of Federal funding was used to support educational services.

While all of this may certainly be enough to get educators “rattled,”  they can only speculate at this point what the future holds for public education.  Undoubtedly, there’s a heightened concern revealed in the record turnout of candidates running for school board positions, myself included.

This could possibly be one of the most important, if not THE most important, school board race I’ve witnessed in my lifetime.  I strongly urge voters to scrutinize candidates and make sure they represent local attitudes. One helpful tool is Illinois Sunshine, which tracks political donations that may influence a candidate’s agenda.  MapLight also offers a variety of voter resources.


Post By:  Daily Herald

Concerns over state school revenue may be one of the reasons 240 Lake County residents have decided to run for school board positions in the spring election, school officials said.

The large turnout of candidates shows up in races through the county but is particularly evident in several particular districts. For example, 11 candidates are seeking five board seats at Woodland Elementary District 50, nine have filed for four seats at Grass Lake Elementary District 36, and eight candidates have filed for two board seats at the College of Lake County.

Lake County Clerk Carla Wyckoff said her office is trying to determine if the number of candidates makes the April 4 consolidated election the largest school election in county history.

Roycealee Wood, the Lake County Regional Superintendent of Schools, said concern over state revenue seems to be one of the driving forces behind the large turnout.

To read article in its entirety, view:  240 candidates to run for Lake County school board seats