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End Pension Corruption Now

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.

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, say, pushing a broom at city hall, after three or four years, to become an official with Local 10 of the International Brotherhood of Broom Pushers, 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 courtesy of the taxpayers.

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:

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 predicated off of his union paycheck in Washington DC, 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 IFT, 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 from his time in the classroom.

And, the pension abuse isn’t only in the state teachers’ pension.

Three of the top six largest pensions in the municipal retirement fund are paid to retirees from non-profit, non-government organizations: Park District Risk Management Association ($20,125 per month), Illinois Association of Park Districts ($18,436 per month), Illinois Municipal League ($15,076). All organizations participated in end of career salary spiking to maximize the government pensions.

According to Fidelity Investments, for a private-sector employee to earn a guaranteed six figure annual pension, they would have to invest about $40,000 in an annuity every year for forty years.

These unions and non-profit organizations exert so much muscle in Springfield that they’ve literally written themselves into the government’s pension code.

The greed of union leadership and other insiders is draining government pension funds. Unearthing these insider scams helps to protect the hard working rank-and-file government employees and taxpayers. Since the sustainability of Illinois’ pension systems is in question, public employees and taxpayers deserve hard facts and estimates of our liability.

End the “pension invention” of sweetheart union and non-profit organization access to our taxpayer-funded government retirement systems. Let’s protect taxpayers and the hard working rank-and-file public employees.

Passing Senate Bill 2499 is a good first step to reforming our pension system which will end the ability of people to collect taxpayer-funded pensions based on employment outside of government.
John Bambenek's avatar

John Bambenek

Republican candidate for the 52nd State Senate district.
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