According to TRS, “the
Executive Director serves as the Secretary of the Board and the System’s chief
executive officer and is responsible for the detailed day-to-day administration
of the System. The Executive Director shall perform all duties prescribed by
the Illinois Pension Code or by rule, order, or resolution of the Board. The
Executive Director’s performance review is conducted annually.”
When Dave Madsen, Todd Mertz, John Dillon and I attended the
“Fixing Illinois Public Pensions” forum, sponsored by the Better Government
Association on April 9, Ty Fahner, president of the Civic Committee of the
Commercial Club of Chicago, told the audience that Executive Director Dick
Ingram had said that the “TRS pension system will be insolvent [by 2030].” Ingram
also attended this meeting and raised no objections to Fahner’s comment.
On April 10, the Chicago Tribune printed this statement sent by
Ingram to Voice of the People, “To be clear: Neither I nor Teachers’ Retirement
System is proposing any changes in member benefits, especially a reduction in
the current annual cost-of-living adjustment… It is not our role at TRS to
suggest a solution to this problem…” Ingram then proceeded to say, “New
revenues must be generated, and if they are not, benefits may have to be
reduced… There are only a few options available and none is very pleasant to
discuss – changes in the cost-of-living adjustment; in member contributions; in
retirement age and in the benefit formula; as well as increased revenues
through new taxes.”
On April 23, Merle Taber, John Dillon and I were invited to
attend an editorial board meeting at the Chicago Tribune. One of several of the
Board’s main substantiations of proof used for pension reform was Ingram’s
statement regarding “TRS’ [inevitable] insolvency.” That same evening, on WTTW,
Chicago Tonight, Fahner reiterated that “Ingram said, guess what? We’re going
to go broke – that’s for the teachers, the IEA and IFT – in a very short period
of time.”
(Incidentally, Fahner, “a rich white guy,” likes to also say
that it’s not fair for the 95 percent who are not public sector union members to
pay for the five percent. Perhaps Fahner should ask whether the 99 percent want
to suffer even more cuts to education and health care funding and other
essential services because of the one percent (the Civic Committee and other
wealthy groups) that does not pay a fair share of taxes).
For Ingram to suggest unconstitutional alternatives for
solving the state’s budget problems is to also not focus on the essential cause
of the state’s deficit: revenue funding.
Regardless of whether Ingram assumed a "worst-case scenario,” in
other words, if the General Assembly “[did] not continue to provide all of the
funding called for in state law,” he still provided endorsement of the Civic
Committee’s (Illinois Is Broke) and the Chicago Tribune's exhortation for
pension reform as the only solution for the state’s “budget mess.”
It is not one of the executive director’s duties to make self-contradictory
statements that jeopardize the TRS members’ benefits and rights guaranteed by
the Illinois Constitution. It is not
“prescribed by the Illinois Pension Code” that the executive director’s role is
to also validate a fallacious and illegal argument “where lawmakers [the Civic
Committee and the Chicago Tribune also perpetuate] a [certain] solution.”
Surely, it wasn’t the March 30th resolution of
the TRS board (of which the IEA president is a member) that may have incited
Ingram to speak so irrationally?
Consider the Board of Trustees’ Resolution stated on March
30: “Having heard the report of
the Executive Director describing the analysis performed by TRS staff and
actuaries evaluating the State of Illinois’ ability to meet its existing future
funding obligations, the Board of Trustees hereby resolves that the fiscal
situation of the State has deteriorated to the point that the Board no longer
has confidence that the State will be able to meet its existing funding
obligations to TRS. As a result, the Board believes that action must be taken
now to ensure the continued solvency and viability of the plan. This action
must be based on the following principles:
“The impact of any
proposal, and all future contributions to the plan, must be determined using
generally-accepted actuarial principles and standards and not the funding
scheme and pension bond limits currently in Illinois law. All future contributions must be guaranteed
by statutory language substantially similar to that presented to the Governor’s
pension assembly in February. Any
changes to the Pension Code must first correct the existing inequities and
funding flaws created with the enactment of Tier II and, any changes to the
Pension Code must be based on the simplest and most straightforward changes
possible.
“Further, the
Board resolves that it will only certify future contributions that are
calculated based on generally accepted actuarial principles and standards. The
Board further resolves to continue to commit the time and expertise of its
staff and actuaries as necessary to ensure the accurate analysis of any and all
proposals for changes to the Pension Code. Passed Unanimously” (TRS).
Also read “Message
from Cinda Klickna, president of the IEA” (April 12): http://teacherpoetmusicianglenbrown.blogspot.com/2012/04/message-from-cinda-klickna-president-of.html
“Poisoning the
Pension Well: TRS Executive Director Dick Ingram’s Shift in Position” (April
2): http://teacherpoetmusicianglenbrown.blogspot.com/2012/04/poisoning-pension-well-trs-executive.html
“Insolvency by
Cinda Klickna, IEA President” (March 31): http://teacherpoetmusicianglenbrown.blogspot.com/2012/03/statement-regarding-pension-solvency.html
“Insolvency by Bob
Lyons, TRS Board” (March 31): http://teacherpoetmusicianglenbrown.blogspot.com/2012/03/insolvency-by-bob-lyons-trs-board.html
“TRS Executive
Director Richard Ingram’s Address to Delegates at the IEA Representative
Assembly” (March 27): http://teacherpoetmusicianglenbrown.blogspot.com/2012/03/trs-executive-director-richard-ingrams.html
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