A press release from State Senator Pam Althoff:
Althoff: Shifting pension risk onto local schools wrong approach
Pam Althoff
SPRINGFIELD, IL. – State Sen. Pamela Althoff (R-McHenry) says a pension proposal being advanced in Springfield that shifts costs onto suburban and Downstate school districts could result in higher property taxes without initiating true reforms.
Althoff says she will oppose the measure, Senate Bill 1673, should it come to the Senate for a vote in its current form. Under the legislation, Illinois state government would shift future pension liability risk onto local governments including school districts, universities and community colleges.
Such a move could put those entities at risk of market fluctuations and actuarial assumptions leading to declining investment returns, forcing them to impose higher property taxes to compensate for the shortfall.
“I am absolutely against any pension reform plan that shifts this financial risk without addressing the core root of the problem, which is the skyrocketing costs associated with the current system,” Althoff said.
“Even worse, if this plan took effect, suburban and Downstate school districts could be in enormous financial jeopardy should investments not come back as expected, which could lead to higher property taxes to pay for the losses.
“This bill is bad for taxpayers, bad for the economy and bad for state employees who deserve a solution that truly protects the long-term solvency of the pension system.”
The McHenry senator warned that constituents she’s talked to are demanding lawmakers enact true and real pension reform that reins in costs today, rather than pushing the problem onto others.
“This is exactly the type of fiscal sleight-of-hand that’s gotten Illinois pension system to the precarious point it’s at today,” Althoff warned.
“Local school districts aren’t the ones who’ve shortchanged the pension system to the point where it needs massive restructuring – that happened on the state level. It’s only right that Springfield step up and come up with a solution that doesn’t unduly punish local school districts and colleges.”
Duh.
I’m surprised… raising taxes — even local property taxes — has rarely bothered the ILL GOPher leadership.
“which could lead to higher property taxes to pay for the losses.”
Since local schools already raise property taxes the maximum allowed by PTELL, Sen. Althoff is either lying or doesn’t understand the tax caps.
School districts cannot be allowed to spike pensions any longer.
Gradually shifting this burden back to those districts makes sense.
I’m not sure if this bill is the right tool, but her argument is invalid and intellectually dishonest.
It is all taxpayer money!!!
I want the Legislature and the Senate to pass a budget which returns ALL the taxpayer dollars diverted from pension funds back to the pension funds.
If this means we need to eliminate some social welfare and healthcare programs, so be it. If this means we eliminate collective bargaining in the public sector, so be it.
Althoff’s naive approach of “we need to compromise” got us in this mess and we need strong conservative leaders to step forward and quit the compromises.
If pension funding is to be done at the local level, I have no problem as long as there is an equal offset in the state sales tax or income tax.
As I stated, it is all taxpayer money.
The statement: “a solution that doesn’t unduly punish local school districts and colleges.” contains zero logic.
How can you punish a school district?
It is all taxpayer money!!!
Must be another statement of ‘compromise’
Knowledge, I see what you’re saying and agree that fundamentally, it’s all taxpayer money.
I also buy the argument that school districts, which collect about 2/3 of our property tax monies, need to take responsibility for some of the outlandish and over priced contracts they’ve penned.
Local accountability is a great thing!
My only concern is that, by shifting the burden to local districts, many of which don’t have the resources needed to rectify IL’s pension woes, the situation would deteriorate even more-for both pension program and the local jurisdictions.
Perhaps by consolidating school districts, compelling IL to make good on funding pensions, then turning them over to the school districts (similar to how local Police and Fire Pensions are run, complete with local Pension Boards. regular audits and State Law) and ensuring teachers pay into their pension (Public Safety pays just under 10%) this mess can be righted.
I hope we have left behind the days when school staff sees overboard pay raises in the last year(s) of work, where the “State” foots the bill for a lifetime of benefits because some local administrator can shed responsibility.
I hope we lose the spiraling out of control paychecks, hedged on (of course) a need for “the kids” and based upon comparables. (on a side note, teachers should not be allowed to strike-just like public safety-go through interest arbitration and avoid ransoming our kids, but I digress).
Changes must be made and everyone needs to put on their grown up pants, have a seat at the table and talk like rational adults-which may be the problem!
Quite often teachers’ unions have friendly school boards.
If we had a County Level School Board that controlled the districts instead of individual school boards that would cut down on the BS.
And if they were held responsible for miss-appropriations then they wouldn’t just give our money away.
The teachers should pay their portion of their retirement
I pay 8.5% every pay check and it includes overtime.
I pay $300 for my health insurance a month.
Why can’t they pay something?
I pay into Social Security and Medicare why don’t they?
I wasn’t giving a choice, i was always told we had to pay these and that was just the way it was.
The politicians pay 11.25% and get 3 times that back, how is that.
And they have us do ethic training where is there’s?