March has been a quiet, yet busy month for pension reform. The Governor’s task force is diligently working to get their proposal ready by the April 17th deadline.
Senate President John Cullerton has done an about-face on pension reform – in the past he has stated that pension reform is unconstitutional where as now he states that pension reform can be done constitutionally. His idea is to first shift some of the liability from the state to the school districts. Second, he says the teachers would have to elect to reduce their benefit or increase their contribution – in particular he mentioned the cost of living adjustment as one area to consider. Then the state would guarantee is annual funding.
It is also noteworthy to take a look at what TRS is saying. The executive director Dick Ingram and the board of trustees put out a memo recently saying:
“The fiscal situation of the State has deteriorated to the point that the Board no longer has confidence that the State will be able to meet its existing funding obligations to TRS. As a result, the Board believes that action must be taken now to ensure the continued solvency and viability of the plan.”
There is a lot of pressure being put on by the Politian’s to get something passed by the end of this general assembly before the state’s $5 Billion dollar contribution is due in June. The bulk of the negotiations are focused on the funding issue and how the annual contribution will be split between the state and the school districts. We believe the benefit provisions will look very similar to SB512.
We will continue to update you on pension reform as it unfolds. In the meantime, you can take a look at one of our resources designed to help teachers put money back in their pocket.
This resource is our no cost tax review that identifies if you are missing deductions uniquely available to educators. In the 20 years we have been serving teachers, we have found that over 90% of teachers overpay the IRS by $2-$5,000 per year.
Call us for a no-cost review. It’s free, and there’s a 90% chance that we can recover a substantial amount of money for you.
I hope you found this update to be helpful. Thank you for visiting the SeCura partners teacher resource center.