After we created a rubric to grade state teacher retirement plans, we found a mostly depressing picture: States have set up expensive, debt-ridden systems where most teachers fail to qualify for decent retirement benefits.
Pension legacy costs can restrict the amount of resources available for current public education and make it more difficult to attract and retain high quality teachers. Oregon provides a useful case study in pension legacy costs because many school districts in the state are now reallocating General Fund expenditures to cover sizeable past pension promises. This paper first describes how Oregon’s past pension promises, as compared with nearby Washington’s, affect the level of resources available to compensate new teachers.
One out of every four dollars that Illinois taxpayers send to Springfield goes toward pensions. Legislators have already passed cuts to teacher retirement plans and will need to continue funneling revenue to pay off the debt. But what policymakers and others have failed to ask is how well the current pension system is serving its workers, particularly teachers.