D230: Changes to Teachers’ Retirement System Funding Would Have Detrimental Impact

A statement from 0

The proposed shift in funding for the Teachers’ Retirement System (TRS) from the State to local school districts would be the largest unfunded mandate ever imposed by the State of Illinois on school districts. It would carry a $14 million annual price tag for District 230 and its taxpayers.

It is important for the District 230 community to understand this issue and the potential impact that shifting the State’s portion of these pension contributions onto local school districts would have on our students and community.

TRS pension covers certified employees including teachers, administrators, social workers, and counselors. Currently a TRS employee pays 9.4% of their salary into the pension system. By comparison, the typical U.S. worker pays 6.2% of their pay into Social Security. In addition TRS employees pay 1.45% into Medicare just like other American workers. The local school district pays another portion of the pension contribution and the State pays its share.

State Legislators are proposing that the portion that would typically be paid by the State become the responsibility of local school districts and in turn the responsibility of local taxpayers. In District 230’s case, the school district would be responsible for an additional $14 million per year. This would be on top of the TRS payments already being paid by employees and the school district.

While District 230 has successfully managed its finances to accommodate unfunded and underfunded mandates including driver education, transportation and special education, this additional mandate would have significant negative consequences on the programs and services available for District 230 students as well as on the taxpayers of our community.  Over the years, District 230 has managed its finances responsibly with balanced budgets and sound fiscal practices. The district has also systematically controlled expenditures and focused cost reduction away from the classroom.

If this legislation is passed, District 230’s finances will be impacted significantly. District 230 will be forced to cut personnel and programs that directly impact the quality of education that our community expects and our students deserve. District 230 would also need to seek additional revenue which could result in increased fees for families and increased taxes within our community. A systematic review process would be put into place during the 2012-13 school year to determine what expenses would be cut and what revenues would need to be increased.

Therefore, the District 230 School Board calls on our community to join us in asking State Legislators to oppose any legislation that would shift responsibility for paying any portion of the State’s share of the TRS contribution to local school districts and their local taxpayers. The School Board also asks that you join us in telling legislators that we expect them to carefully and thoughtfully engage in a dialogue with all stakeholders, including representatives of local school districts, before taking action on this topic. School district voices and those of our taxpayers must be heard.

The quality of education for our students depends on responsible decision making by our elected officials.  We ask that you call State Representatives and Senators to share this message. We will continue to provide information to help you learn more about this topic and the ramifications for local school districts.