Change law overseeing pensions

The legislature and public employees are debating furiously over pension reform. But for employers a very different problem needs reforming.

Six years ago, to fix the practice of “spiking” end-of-career pay to boost retiree pensions, lawmakers enacted the “6 percent rules,” and penalized public employers for increases in final annual earnings above this limit. Any end-of-career salary above 6 percent must be reviewed by the appropriate pension fund. Different jobs or work assignments can affect how pay is counted.

In the case of colleges and universities, retiring employee salaries are reviewed by the State Universities Retirement System of Illinois. SURS is one of the smaller public pension systems; last year 1,169 college and university retirees were scrutinized for potential overage of the 6 percent cap.

Ironically, the cost for violating the 6 percent cap is assessed to the institutions and not to the employees. Because the system has complex rules and exemptions, college and university officials appealed and argued over 70 percent of these cases, and were successful in the vast majority. Yet, each review requires additional costs — a cost ultimately paid by our taxpayers.

There is a simple solution. Change the oversight law so that only 6 percent or less of workers’ raises counts toward the pension benefit. If an employee exceeds the limit, there would be no impact on pension benefits. The result would be that thousands of work hours and millions in funding can be redirected to needed services rather than simply shuffling tax dollars between government entities without any savings.

Jerry W. Weber, President

College of Lake County

Grayslake