Jim Dey | After a year, Teachers’ Retirement System’s dirty laundry put on display

Link: https://www.news-gazette.com/opinion/columns/jim-dey-after-a-year-teachers-retirement-systems-dirty-laundry-put-on-display/article_f9668f4b-1a9f-512f-b2b4-e04a58b7b08d.html#new_tab

Excerpt:

There was a personnel earthquake in the summer of 2020 at the Teachers’ Retirement System in Springfield.

Ultimately, five high-ranking employees were removed from their positions, including executive director Richard Ingram. The tumult generated clouds of uncertainly that only recently started to clear, revealing improper and possibly criminal behavior.

Although mum at first, TRS officials recently released their first lengthy statement about what occurred, disclosing that a new employee purposely maintained a conflict of interest that he falsely claimed to have ended.

…..

The OEIG report states the scandal dates back to 2018, when the TRS “began the process of constructing a new pension system that it called the Gemini Project.” Urbanek said the Gemini system recently went online.

That required hiring outside information technology professionals. Singh and his company — Singh 3 Consulting — were initially hired as a contractor. But in 2019, the TRS hired Singh as a permanent employee, the hiring predicated on Singh terminating his relationship with his company.

He told the TRS he had done so. But no one apparently ever checked, because subsequent investigations revealed Singh remained president and chief executive officer.

Author(s): Jim Dey

Publication Date: 12 September 2021

Publication Site: The News-Gazette

One Year After Teachers’ Retirement System Head’s Departure, Report Details More Turnover At Top

Link: https://www.nprillinois.org/statehouse/2021-09-08/one-year-after-teachers-retirement-system-heads-departure-report-details-more-turnover-at-top-1

Excerpt:

One year after the head of Illinois’ largest public employee pension fund resigned due to what the fund has only described at “performance issues,” a recently published report by the state’s chief ethics officer reveals the circumstances behind the departures of two more former high-ranking officials at the pension fund in 2020.

The former chief information officer at the Illinois’ Teachers’ Retirement System repeatedly directed contracts toward the company he founded and also lied about having severed ties with the company, according to a report published last month by Illinois Executive Inspector General Susan Haling. TRS manages the pensions of more than 427,000 current and retired teachers as well as pension beneficiaries.

The report centers on former CIO Jay Singh’s conflicts of interest, but also brings to light the firing of TRS’ former chief financial officer, Jana Bergschneider, who was fired last July as the investigation unfolded. Singh resigned in April of last year, two months after he was interviewed as part of an internal investigation into his conflicts of interest.

….

Bergschneider was terminated from TRS on July 2, 2020 based upon her “work performance and conduct related to the procurement process on the Gemini Project,” the OEIG report said, apparently quoting from a reason given to investigators by the pension fund.

Ingram was placed on administrative leave at the end of that month — a result of the TRS board’s unanimous vote after an investigation into performance issued conducted by Chicago Law firms King and Spalding. He resigned a few days later and TRS remains tight-lipped about the exact reason for Ingram’s departure, calling it a personnel matter.

But Urbanek reiterated to NPR Illinois the same reasoning given every inquiring media outlet in the last year: that Ingram “had difficulties meeting performance metrics in his contract.”

Author(s): Hannah Meisel

Publication Date: 8 September 2021

Publication Site: NPR Illinois

Suburban Residents Risk Losing Homes Over Rising Pension Costs

Link: https://www.riverbender.com/articles/details/suburban-residents-risk-losing-homes-over-rising-pension-costs-52884.cfm

Excerpt:

In the 1990s, Illinois property tax bills were around the national average. But in the two decades from 1999 to 2019, we’ve seen a massive 65% increase in residential property taxes, adjusted for inflation. That increase is what drove Illinois to have one of the highest tax burdens in the nation.

The source of Patricia’s – and her fellow Illinoisans’ – property tax pains? Public employee pensions.

More than 70% of Patricia’s property tax bill goes to the school district. While school districts account for a significant portion of property tax bills in localities across the United States, school district budgets across Chicago and Illinois are getting devoured by underwater pension systems.

While the state is responsible for paying employer pension costs for teachers outside of Chicago, rising pension obligations mean more state dollars are spent on pensions, leaving more classroom costs for school districts to fund through property taxes.

Author(s): Amy Korte

Publication Date: 5 September 2021

Publication Site: Riverbender

Teacher Retirement Systems: A Ranking of the States

Link: https://bellwethereducation.org/publication/retirement-systems-ranking

Graphic:

Excerpt:

Teacher retirement plans are called “gold plated” by their proponents and critics alike, when in fact half of teachers will never see a pension at all. Only about one in five teachers gets a full pension. And in many cases retirement benefits shortchange teachers and make it harder for them to save for their retirement

In Teacher Retirement Systems: A Ranking of the States, Bellwether Education Partners ranks how state retirement systems serve U.S. teachers and taxpayers:

….

Retirement programs don’t serve all teachers equitably. For teachers who work in the classroom for fewer than 10 years, 34 states receive an “F” for how well retirement plans prepare them for retirement. For teachers who work in the classroom for more than 10 years, but do not stay until retirement age, 23 states receive an “F” ranking.

Link to full report: https://bellwethereducation.org/sites/default/files/Teacher%20Retirement%20Systems%20-%20A%20Ranking%20of%20the%20States%20-%20Bellwether%20Education%20Partners%20-%20FINAL.pdf

Author(s):

MAX MARCHITELLO
ANDREW J. ROTHERHAM
JULIET SQUIRE

Publication Date: 31 August 2021

Publication Site: Bellwether Education Partners

Teacher Retirement Systems: A Ranking of the States

Graphic:

Excerpt:

Bellwether Education Partners is a “national nonprofit focused on dramatically changing education and life outcomes for underserved children. [They] do this by helping education organizations accelerate their impact and by working to improve policy and practice.” And making good money* doing whatever that means.

Apparently this think tank got some interns to go through official teacher pension data reported by the 50 states and the District of Columbia to come up with rankings. New Jersey was not last overall (probably on account of the ARP money that went into the pension this year) but Medium-term and Long-term New Jersey did come in last…..and by a lot.

Author(s): John Bury

Publication Date: 3 September 2021

Publication Site: burypensions

Known unknowns – teacher salaries

Link: https://allisonschrager.substack.com/p/known-unknowns-0a3

Excerpt:

 My colleague at Bloomberg writes we’ll have to pay teachers more to get them to return to work. Their pay has been stagnant for a decade. But their compensation has not been. A very large part of teachers’ compensation comes in the form of a massive risk-free asset—a defined benefit pension. The value of this pension increased as real interest rates fell. It not only took more resources for the states and municipalities to finance (assuming the pension funds were well funded—a big if) the pension when rates were low. The pension became more valuable.

So teachers really got large raises in the form of their more valuable pension. The problem is they don’t fully internalize how much more their pension is worth. Also, pensions are less valuable for young teachers who may change jobs one day. If we do want to increase teachers’ pay, we really need to reform the pensions. Reform would free up more money for salaries, and there’s evidence young teachers prefer more flexible compensation.

That probably won’t happen since the teachers’ union is very attached to its defined benefit plan. But you can’t have it all, even in this labor market.

Author(s): Allison Schrager

Publication Date: 7 June 2021

Publication Site: Known unknowns at substack

Pennsylvania’s Biggest Pension Racks Up Costs After Misreporting Returns

Link: https://www.wsj.com/articles/pennsylvanias-biggest-pension-racks-up-costs-after-misreporting-returns-11620990002

Excerpt:

The board of trustees overseeing the $62 billion Pennsylvania School Employees Retirement System has spent more than $1 million so far to investigate and contain fallout from an inaccurate report on investment results delivered late last year. The report led to a mistaken conclusion that no increase in employee pension contributions would be needed this year.

The system’s trustees have hired batteries of lawyers since the mistake was revealed. The board said in April that it had hired law firms to conduct an investigation into the miscalculation and to respond to a federal grand jury subpoena requesting documents. It couldn’t be determined whether the subpoena relates to the miscalculation.

…..

However, in March the pension system said that the actual nine-year return came to 6.34%, triggering an increase in employee pension contributions reportedly affecting some 100,000 workers whose contributions will increase by 0.50% to 0.75% starting July 1. For instance, a school worker who earns about $45,000 annually would have roughly $8.65 withheld from each biweekly paycheck, the system’s website explains.

Author(s): Preeti Singh

Publication Date: 14 May 2021

Publication Site: Wall Street Journal

PSERS bet big on this scrubs brand whose IPO boosted a Steelers owner’s billions

Link: https://www.inquirer.com/business/figs-scrubs-psers-steelers-tull-ipo-20210602.html

Excerpt:

Figs Inc., which sells stylish hospital scrubs, has pulled off a successful public stock offering that has enriched a Pittsburgh investor along with Pennsylvania’s beleaguered school pension fund and other early backers, at least on paper.

Investors’ appetite for attractive new stocks appears to have paid off for Thomas Tull, a billionaire tech investor and Steelers part-owner, by more than $20-$1, while quadrupling the PSERS pension fund’s investment — if it can cash out its shares at today’s bullish prices.

Early private investors typically face a “lock-up” period, often six months, before they can sell all shares. The stock could gain value or crash before the shares are sold.

Still, a big Figs payday would be a boost to beleaguered PSERS chief investment officer James Grossman. His team’s complex and often secretive investments have been criticized by a growing reform faction of PSERS trustees who say the fund could do better in low-cost index funds.

Author(s): Joseph N. DiStefano

Publication Date: 2 June 2021

Publication Site: The Philadelphia Inquirer

Mask Use and Ventilation Improvements to Reduce COVID-19 Incidence in Elementary Schools — Georgia, November 16–December 11, 2020

Link: https://www.cdc.gov/mmwr/volumes/70/wr/mm7021e1.htm

Graphic:

Excerpt:

Representatives from 169 (11.6%) of 1,461 schools in 51 (32.1%) of 159 Georgia counties (median = two schools per county) completed the survey and also had available COVID-19 case data (Figure).¶¶¶ Schools reporting 100% virtual learning were excluded. Among the 169 schools, 162 (95.9%) were public, representing 47 (26.0%) of 181 public school districts in Georgia (median = two schools per district). Schools had a median of 532 enrolled students (attending virtually and in-person), 91.1% were publicly funded, 71.0% were located in metropolitan areas, and 82.2% used hybrid learning (Table 1). Median class size was 19.0 students (interquartile range [IQR] = 15.0–21.0); median cohort size was 20.0 students (IQR = 15.0–21.0). Among all schools, the proportion of students receiving at least some in-person instruction ranged from 8.5% to 100% (median = 84.7%); 3.0%–100% (median = 64.0%) were eligible for free or reduced-cost meal plans, and approximately one half of students were White (median = 55.1%), followed by Black (median = 17.0%), Hispanic (median = 9.0%), multiracial (median = 4.5%), and Asian (median = 1.0%).****

Prevention strategies implemented at participating schools included requiring masks for teachers and staff members (65.1%) or students (51.5%), flexible medical leave for teachers (81.7%), improved ventilation (51.5%), spacing all desks ≥6 ft apart (18.9%), and using barriers on all desks (22.5%). Schools reported a median of 9.0 (IQR = 8.0–9.0) locations with handwashing stations (Table 1).

Author(s): Jenna Gettings, DVM1,2,3; Michaila Czarnik, MPH1,4; Elana Morris, MPH1; Elizabeth Haller, MEd1; Angela M. Thompson-Paul, PhD1; Catherine Rasberry, PhD1; Tatiana M. Lanzieri, MD1; Jennifer Smith-Grant, MSPH1; Tiffiany Michelle Aholou, PhD1; Ebony Thomas, MPH2; Cherie Drenzek, DVM2; Duncan MacKellar, DrPH1

Publication Date: 21 May 2021

Publication Site: CDC

Schools Are Dropping Mask Requirements, But A New CDC Study Suggests They Shouldn’t

Link: https://www.npr.org/2021/05/21/999106426/schools-are-dropping-mask-requirements-but-new-cdc-study-suggests-they-shouldnt

Excerpt:

New research released Friday by the Centers for Disease Control and Prevention reinforces an old message: COVID-19 spreads less in schools where teachers and staff wear masks. Yet the study arrives as states and school districts across the country have begun scaling back or simply dropping their masking requirements for staff and students alike.

….

The new study comes from Georgia and compares COVID-19 infection rates across 169 K-5 schools. Some schools required teachers, staff and sometimes students to wear masks; some did not.

Between Nov. 16 and Dec. 11, researchers found that infection rates were 37% lower in schools where teachers and staff members were required to wear masks. The difference between schools that did and did not require students to wear masks was not statistically significant.

Author(s): Cory Turner

Publication Date: 21 May 2021

Publication Site: NPR

‘Unsustainable’ pension woes hang over Chicago, Lightfoot says: In a speech to potential investors, the mayor combines optimism about the city’s future with a dire warning

Link: https://www.chicagobusiness.com/greg-hinz-politics/chicagos-recovery-clouded-unsustainable-pension-woes-lightfoot-tells-investors

Excerpt:

Coupling a boatload of optimism with a dire warning, Mayor Lori Lightfoot told investors from around the country that Chicago is well positioned to recover from the COVID-19 pandemic and is a good place for them to allocate their cash.

But her remarks May 6 were far different on the subject of underfunded city pension funds, a problem that has bedeviled mayors for the past two decades.

Though workers deserve what they’ve been promised, she said, “that promise will not be met” unless Springfield lawmakers come to the table with financial aid or other reforms.

….

Lightfoot did not use the word “default.” But some financial experts have warned that some of the city’s four pension funds, particularly those covering firefighters and police, may have trouble paying promised benefits within a few years if they don’t get help.

Author(s): Greg Hinz

Publication Date: 10 May 2021

Publication Site: Crain’s Chicago Business

Teachers union demands leadership changes at embattled PSERS pension fund

Link: https://www.post-gazette.com/news/state/2021/05/21/Teachers-union-demands-leadership-changes-at-embattled-PSERS-pension-fund/stories/202105210131

Excerpt:

A union that represents 61,000 schoolteachers statewide called on most of the board of the Pennsylvania State Employees’ Retirement System to resign amid an ongoing FBI investigation.

“Through alleged errors and omissions, and under a shroud of secrecy, this PSERS Board appears to have jeopardized the present and future financial security of our Commonwealth’s most dedicated public servants,” Arthur Steinberg, president of the Pennsylvania chapter of the American Federation of Teachers, wrote in a letter to PSERS board members.

In the letter, Mr. Steinberg called for every board member appointed prior to January 2021 to immediately resign. That would reduce the 15-member board to two: the newly elected State Treasurer Stacy Garrity, a Republican, and state Sen. Katie Muth, D-Montgomery County.

Author(s): WALLACE MCKELVEY, pennlive.com

Publication Date: 21 May 2021

Publication Site: Pittsburgh Post-Gazette