Illinois Loophole Lets Teacher Union Leaders Boost Pensions After Leaving Classroom

A Washington Times investigation has uncovered an interesting legal quirk in Illinois that lets retired teachers continue to build pension credit after retirement. The law allows teachers who later become union leaders to credit their union salaries towards their pension.

More from the Washington Times:

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.

“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.”

It’s important to note that the employees in question were still contributing to the pension system during the time they worked with unions — so they weren’t getting a completely free ride.

More details on the law in question, from the Washington Times:

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.”

In 2012, Illinois Gov. Pat Quinn signed a law that prevented teachers from using service time with unions to boost pension benefits – but the law only applies to union work done before the teachers were hired, not after.