$10 million a year in bad-credit penalties? What a deal! says Illinois; Plus: Court nixes suburban pension jackpot

$10 MILLION PENALTY = SUPER BARGAIN With interest rates historically low, states are rejoicing at how little interest they have to pay to finance large-scale public works projects like road construction. Not Illinois. Saddled with the worst credit rating of any state, we find good news in the fact that we'll only pay $10 million more a year in interest on our latest bond sale than would a state with good credit, like Wisconsin. Need we remind you that that's $10 million of your tax dollars that will go up in smoke because our lawmakers have let state pension debt spiral out of control? Probably not, but we do anyway in today's editorial, which tries to put this annual, wasted $10 million into perspective.

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SUBURBAN GENEROSITY In today's Daily Tip-Off section of our website, we highlight a story from the Daily Herald of Arlington Heights that probably will drive you crazy no matter where you live in Illinois.

Back story: A few years ago, Illinois passed a law that said school districts would have to pay the extra pension costs generated when they gave end-of-career pay raises of more than 6 percent to teachers and administrators. But that did not deter Schaumburg Township Elementary District 54, which granted big raises to seven administrators after the law passed. Those raises jacked up the employees' pension payments by $586,000, so the Illinois Teachers Retirement System sent a bill to the Schaumburg district. Schaumburg sued, saying the administrators' contracts guaranteed them hefty raises in their final years (?!) so their pensions were the exclusive responsibility of TRS.

But here's what Schaumburg really was saying: "We want every teacher in the state to help us pay for hundreds of thousands of dollars in extra pension costs we're loading onto their already struggling retirement fund." Luckily, the Illinois Supreme Court last week declined to hear the district's case, so TRS wins.

But that's not all. Schaumburg is still trying to recover $97,000 it was fined by TRS after giving another administrator, Assistant Superintendent for Business Services Mohsin Dada, three consecutive 22 percent raises in his final years of employment. 

Reports the Daily Herald: Dada "was making $341,747 in 2010 after receiving the raises each of the three previous years. At the time, he was the third highest-paid public school employee in the state. He left the district in 2011."

Unfortunately, these kinds of deals were the norm in many school districts for years, but they've been especially egregious in the Chicago suburbs, where salaries are drastically higher than in other areas of the state. The Schaumburg district's attitude -- that all members of TRS should chip in to pay for its extreme generosity -- is outrageous. Equally outrageous is that, as the Daily Herald reports, the Schaumburg district has spent $33,500 in legal fees on these cases.

Lest you think this example is a mere anomaly, we provide this infographic, which shows the highest pensions in the Teachers Retirement System. Note the location of the school districts from which they retired (hint: north of I-80, east of I-39). Note, too, that these pension figures are hardly typical of the average teacher pensions, which are around $48,000. Take a look here.

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DAILY TIP-OFF Business-choking travesty or closing of unjust loopholes for corporate fat cats? That was the question Wednesday before the Illinois Senate Revenue Committee as it heard arguments on a bill to eliminate some corporate tax breaks that Gov. Pat Quinn says will bring in $320 million. If you're among the tens of thousands of businesses who do business with the state and now wait months on end for payment, you probably think this is a great idea. If you're a business that will be hit by new taxes, chances are you have a different view.

“It sends a message loud and clear, manufacturing is not valued in Illinois,” said Carol Portman, head of the Taxpayers Federation of Illinois. Then again, “Nothing is worse than telling a group full of teachers who have been working hard to make a difference that they weren’t going to get a paycheck next Friday,” said Kate Armstrong, chair of the non-profit Through a Child’s Eyes, which provides Pre-K education to at-risk kids. 

The Chicago Tribune defends its claim that there is a 19,000-student waiting list for charter school enrollment in Chicago. Radio station WBEZ has questioned the number, saying it referred to number of applications, including multiple applications from single students. The Trib doesn't exactly say, "Shut up, WBEZ," but it comes close: " It is an estimate, made in good faith, and open to question and challenge." Nobody does umbrage better than the Chicago Tribune.

Speaking of which, the Tribune also takes umbrage at Illinois' failure to enact even a very tiny version of the school voucher system recently upheld by the Indiana Supreme Court. "We never cease to marvel at the opponents' earnest and no doubt expensive efforts in courts and statehouses nationwide to exterminate vouchers and other forms of school choice. The opponents could wipe programs like Indiana's from the Earth — if only they would insist that public schools be better than the less-well-funded competition." That's a lot of marveling.

And in the state's biggest education-related story, Chicago Public Schools CEO Barbara Byrd-Bennett responded strongly to accusations that the coming closure of 54 schools in some of Chicago's poorest neighborhoods is an act of racism. “To refuse to challenge the status quo that is failing thousands of African American students, that’s what I call racist," Byrd-Bennett said Wednesday at a sometimes raucous school board meeting. A Chicago Sun-Times editorial visits one school on the closing list and makes another appeal to split the school closings over multiple years.

Visit our Daily Tip-Off section to find links to these and other reform news stories from around Illinois.

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BATAVIA REBOOT TODAY West-suburban Batavia may be famous as the home of Fermilab, but particle physics and neutrino detection tonight take a back seat to promoting reform and good government as Reboot Illinois comes to the Batavia  Public Library. Come hear from editor Matt Dietrich, Chief Operating Officer Madeleine Doubek and Director of Digital Strategy Anthony Knierem at 7 p.m. today in Meeting Room A of the Batavia Public Library, 10 S. Batavia Ave. (Route 31 and Wilson Street). We'll talk about Reboot's mission, goals and plans. We want to hear your thoughts on improving Illinois' government, state finances, schools and business climate. We promise no atoms will be split in this presentation. Sign up here.

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WE'RE HIRING! We are looking for a director of outreach to work with our partners both on social media platforms and in the communities. See the job description here.  Know anyone who would be a great fit? Let them know about us! 

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