Madison - St. Clair Record

Saturday, September 21, 2019

Pension spending out of control and in need of reform, critic says

By Carrie Bradon | Apr 3, 2018

Are teacher pension subsidies fairly distributed in Illinois?

A recent article published by Wirepoints suggests that the state's wealthiest school districts receive more funding than their less wealthy counterparts.

The article titled "Illinois’ regressive pension funding scheme: wealthiest school districts benefit most," takes a sharp look at the inequities from southern Illinois to wealthy communities surrounding Chicago.

Rep. Tom Morrison believes reforms must be made in state spending.

"The whole problem is when the state pays the pension payments of the school districts, and just a subsidy, what people need to realize is that the wealthiest district, the ones with the biggest salaries, the biggest pensions, and the biggest infrastructure, are getting the biggest benefits, so the scarce state resources are not going to the districts in need but actually going to the wealthiest districts," Ted Dabrowski, author and president of Wirepoints, told the Record. "The system is all messed up."

Dabrowski explained that pension funding through income tax receipts coming from areas like Carbondale, Rockford and Effingham, end up going to pay for multi-million dollar pension plans for individuals in much wealthier areas of the state.

"That's not the only problem," Dabrowski said. "The other problem is that the whole system itself perpetuates more and more spending at the local school districts and that dries up taxes because school district can spend money...In the end, it's the government that pays for those pensions."

He added that the lack of responsibility and accountability for spending is dire. 

Dabrowski believes that equal distribution of funding throughout local districts, rather than expecting the state to fund the pensions for wealthy school districts, would be a fair way to begin solving funding problems.

"Put the accountability where the spending is," Dabrowski said. "That's what you would do in any company or any business or any organization; the problem is that you've got certain legislators who are warning that this shift of cost from the state to local school districts will lead to tax hikes, and that's a false argument, because the current system is what's leading taxes to go higher and higher."

Dabrowski explained that when a system is in place that doesn't require school districts to pay pension costs because the state is handling it, taxes will continue to rise, as will spending. 

"We need to end it," Dabrowski said. "We need to shift the costs to where it belongs."

He said that people need to get upset about pension problems.

"And then we need to have legislators talk truthfully about it and that means that the should tell the truth that the current system is what pushes up taxes and we need to end it," Dabrowski said. 

State Rep. Thomas Morrison (R-Palantine), who has historically been against the government's big spending, favors a gradual move toward local funding. 

"It's critical that we pair this policy change with protections for property taxpayers, however, or else property taxes will continue to balloon," Morrison told the Record. "A gradual shift of normal pension costs to local districts would help provide the necessary accountability and transparency to help rein in these unsustainable salary and benefit increases."

Morrison believes that the responsibility to pay pensions lies with employees of the school district, rather than district taxpayers.

"Illinois must give relief toward expensive, unfunded curriculum and administrative mandates, as well. There should be a greater push toward district consolidation, especially where there are so many small elementary school districts in close proximity to each other," Morrison said.

Dabrowski said the pension funding issue can be confusing because the state systems are complex.

"No one can really understand what goes on and that's what we're trying to simplify," Dabrowski said. 

"But the bottom line is when you have one unit of government who can dole out higher and higher salaries and then another unit of government that pays the cost, no one really understands what is going on, and so what we need to do is first bring understanding and education to the issue and then demand that lawmakers act responsibly on it. Right now, it's too easy to protect the status quo."

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Illinois State Rep. Thomas Morrison WirePoints