Columbus Dispatch: More educators rehired; Dennis Leone quoted re: effect on pension system
The number of Ohio educators who are collecting state retirement pensions while still working is up 62 percent since lawmakers loosened restrictions in 2000.
Of that group, the number making more than $90,000 a year has grown the most, exploding by 1,850 percent.
In 1999, when educators had to wait 18 months after retiring to collect pensions, only 17 were collecting pensions from the State Teachers Retirement System while simultaneously working at jobs paying more than $90,000 a year.
In 2000, lawmakers cut the wait to two months, and by last year the number of retired educators working in those highpaying jobs had leapt to 331, and more are being added to the rolls every month.
The growth of high-paid people who were retired, then rehired shows how hard it is to find qualified people to be district executives, said Scott Ebright of the Ohio School Boards Association.
"It’s keeping experienced administrators," he said. "That pool seems to be shrinking."
With an income of $197,950 and a state pension equal to about 88 percent of that, Solon school Superintendent Joseph Regano is the highest-paid Ohio educator in this status, according to retirement-fund data.
The Solon Board of Education’s decision two years ago to allow him to retire and then be rehired to a four-year contract financially benefited both him and the district, Regano said. He got to keep working fulltime and collect a pension, and the district got to hand his $11,000-a-year health-insurance premiums to the retirement system.
"I think I would be lying to you to say it’s not money-driven," said Regano, 58. "This isn’t like I’m 40 looking at the next 10 years. I’m looking at the end of my career."
Teachers in Solon are also offered a similar deal, but they must leave the district after one year back on the job, Regano said. The district uses it as a retirement incentive so that longtime employees can be replaced with lower-paid, entrylevel workers, he said.
Voters don’t seem to have a problem with the plan, because it’s saving the district money, Solon school-board President Margo Morrow said.
"I have not had anyone call me and express dissatisfaction," Morrow said.
Dennis Leone, retirement system board member, said that while it may be a win-win situation for a school district and the retiring employee, the pension system is paying the bill. It lost $2 million last year providing health insurance to retired rehirees, he said.
The system’s board voted earlier this year to make retiredrehired workers get health care if possible from their employers starting in 2009.
Next month, the board will discuss the long-term financial health of the system in light of the fact that teachers’ payments into the system are not growing as quickly as projected. The board also might discuss what a financial shock, such as a large stock-market downturn, could do to its ability to meet its obligations, Leone said.
However, he doesn’t think the fund is being too generous by allowing retirees to simultaneously work and collect pensions.
Employees contribute 10 percent of their gross earnings to the fund, while employers — mostly public school districts — contribute 14 percent. That money is mostly invested in stocks, bonds and real estate.
Educators with 30 years in the retirement system qualify for pensions worth 66 percent of the average of their three highest years’ salaries. At 35 years, pensions grow to 88.5 percent of their three highest annual salaries and can climb to 100 percent with additional years of service.
bbush@dispatch.com
posted by Kathie Bracy at 8:10 AM
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