Recently, a scandal has come to light about the misuse of taxpayer dollars involving some of Chicago’s political bosses and their allies running local unions.
Retired union bosses are allowed to dip into taxpayer-guaranteed pension funds even though little of their careers were spent working for the public. And we have found this abuse to be rampant statewide.
In the 1990’s Chicago officials and their allies in the legislature cooked up a little bonanza for their political backers who ran the slew of unions that staffed city departments. If you took a leave from your city job after three or four years, to become an official with a union you could still rack up credit towards your city pension. Not only that, but when you retired, your pension would be tied, not to your $15 per hour broom pusher salary, but your union boss salary, which often topped out over $200,000 per year.
So the people of Chicago ended up paying some union bosses nearly $160,000 a year in pension for a few years of actual city work where they earned sometimes less than $20,000 a year—all guaranteed by the taxpayers.
But within the state teachers’ pension system, the abuse is even larger. Retired leaders of the National Education Association (NEA), Illinois Education Association (IEA), Illinois Federation of Teachers (IFT), and Illinois Association of School Boards (IASB) who are not government employees are draining millions in teacher retirement pensions- news sources say up to $47 million. You can search it yourself at www.openthebooks.com. The pay and pensions of virtually every public employee at every level of Illinois government is posted online.
Consider these examples uncovered by the review of our data: The second highest teacher pension in history goes to the former President of the NEA (national teachers union, Washington, DC). He taught elementary school on the south suburbs of Chicago, went to Washington DC, and became head of the national teachers union. In 2008, he retired on an Illinois state teachers’ pension based on his union paycheck, not off of his earnings as an elementary school teacher. His retirement check started at $20,200 per month.
Using this pension loophole, twenty-one former “labor leaders” have retired and already collected more than $1 million in state teachers’ pension.
Kenneth Drum is a retired union leader of the Illinois Federation of Teachers, who spent only twelve years teaching. Drum’s annuity is more than $160,000 a year. The large pension reflects his twenty year career at the union, not his time in the classroom.
Ed Geppert spent only 8 years teaching in Cahokia, IL and reached a salary of $14,000/yr. Over the next 24 years with the IFT, he rose to President and a salary of $260,000/yr. In his 8 years teaching, he earned a TOTAL of $84,000. Geppert currently has one of the highest pensions in the state-$185,000/yr. He still remains on the Executive Board of the teachers union (IFT).
Most of these union officials did not spend enough time teaching to qualify for a full pension, and those who did still got enormous increases by joining union payrolls. Some are getting pension payments in excess of the average for three teachers who spent their entire career in the classroom. So while the typical teacher, who spends a career in the classroom, gets a pension based on their teaching salary, the union bosses who leave the classroom after just a few years can reap three or even four times the average payment our of the pension fund.
This is neither teacher nor union-bashing. Unearthing these insider scams helps to protect the hard working rank-and-file government employees and taxpayers. Taxpayer-guaranteed pensions should be provided only for those years a person works on behalf of the taxpayers, not labor unions. If union bosses want a pension system, they can set up their own, just like any other employer.
Senator Matt Murphy has introduced Senate Bill 2499 that will mandate that public pensions can only pay retirees for years worked for the public, not for years working for unions, lobbying groups or trade associations. This is a good first step to reforming our pension system that represents common sense and protects the teachers and government employees who work their whole careers for the taxpayers.
Adam Andrzejewski is the founder of For The Good of Illinois a non-partisan, non-profit organization dedicated to transparency, accountability and limited government. He ran for Governor of Illinois is the 2010 Republican primary.