Rauner adopts Madigan plan for pension cost shift to local school boards.

The Chicago Tribune reports this morning:

Republican Gov. Bruce Rauner’s budget on Wednesday will propose having Chicago Public Schools, downstate and suburban school districts and state universities pay more of their teachers’ pension costs, in an attempt to save state government millions of dollars a year.

The proposal is grand larceny.

Rauner stole the idea from Democratic Party state chairman and Speaker of the Illinois House, Michael Madigan.

Rauner likes to blame every problem in Illinois on Michael Madigan.

Then he steals Madigan’s idea.

The pension cost shift is a Democratic Party idea. And a terrible one.

Currently, local school districts pay a small amount into the state’s Teacher Retirement System. Active teachers pay much more – 9% of their salary. Return on investments adds more. The state pays the rest.

Or doesn’t.

The cause of the $130 billion dollar liability – what the state owes to the pension system – is the result of 7 decades of being a deadbeat. Money that was intended to the pension system was diverted to keep corporate and other taxes low.

When Madigan proposed moving all or part of pension payments to the local school districts as part of his pension reform plan, the Republican’s rejected it.

Now Rauner is including it in his budget proposal.

Here’s the problem.

Most school districts in Illinois are in deep financial trouble. Those that aren’t on the state’s financial watch list are running at a deficit, according to the ISBE.

This situation is rooted in the way school districts are funded in this state. We rely nearly totally on local property taxes. The rate of taxation is highest in those communities which have the lowest property values.

Right. The poorest towns pay property taxes at the highest rate so that they can keep their schools open.

That’s because the state doesn’t raise enough revenue to pay its debts. A flat income tax and tax breaks to corporations have created this mess.

What happens if the state adds to local schools the cost of pensions?

Say goodbye to education programs, manageable class sizes and teacher raises to keep up with the cost of living.

It is a recipe for disaster.

It came from Madigan.

Stolen by Rauner.

2 Replies to “Rauner adopts Madigan plan for pension cost shift to local school boards.”

  1. My bet is Rauner will either lose in the primary, or the general. He doesn’t offer anything to the base of either party, and can’t win trying for the middle.

  2. Right concept Fred, bad execution.
    A local school district should pay it’s own freight, period. Of course how to do that is a freakin problem. On the right track though.

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