The kiddies got a snow day today and a good time was had by all. So here’s an idea of how to have a good time with the current retirement funding crisis in the state’s largest school district: let’s give everybody the year off next year in the Omaha Public Schools.
Teachers, don’t teach. Students, don’t learn. Lunch ladies, put aside your hairnets. Buses, don’t roll. Nobody gets paid a dime, and no vendors get to send a bill.
That way, there’s at least a chance that OPS’ gigantic shortfall in its creaky-with-age $1.2 billion retirement system could be plugged in this century.
Of course, NOBODY wants a school district to stop teaching school. But what everybody SHOULD want — fiscal responsibility from our units of government — has not been evident in the OPS retirement debacle. The pension shortfall in OPS has been reported as anywhere between $486 million and $680 million. The latter figure is more than half of the pension liabilities. And it is much more than the entire OPS annual budget, $557.3 million this year. Worst of all, the shortfall is growing larger, not smaller; in July 2014, it was reported as $450 million.
How on earth can we solve this? Well, if we called a year-long recess, we could pile up the hundreds of millions of dollars in pension liabilities that we should have been piling up all along.
Of course no one’s for that. But how did this happen, so we can prevent a recurrence — that is, if we can ever solve it?
The first thing that would have to go is “The Rule of 85” — the state law lobbied for intensely by the Nebraska State Education Association (teachers’ union) to let a teacher retire at age 55 if he or she has worked in education for 30 years or more. Then after age 55 they can go back to work in education, collect their retirement funds but “double-dip” in a new job and pile up even more savings for retirement. That amazingly generous retirement rule led to the practice of “spiking” — everybody jockeying to get a really high-paid position in their last year or two of their careers, so that they could get a super-high “basis” for retirement pay on top of the early retirement. Then there is the national disease of deficit spending — kicking the accountability can down the road for future generations to worry about how to pay for all the largesse — on top of the lousy economy under President Obama’s anti-business policies, the recession and low interest rates.
Two words, “union” and “pensions,” tell you all you need to know about how this embarrassing shortfall was ever allowed to happen.
Now some people want to force the State of Nebraska’s retirement systems to swallow up the OPS separate pension plan. That would spread the woes out across the state instead of sticking it to Omaha taxpayers in particular. That was the focus on the Unicameral’s Legislative Bill 548, sponsored by State Sen. Brett Lindstrom of Omaha, which had a hearing Thursday
But most of those who testified against consolidating OPS into the state’s retirement fund contended that OPS’ more cushy benefits and earlier retirement permission brought the funding differences on, and it would be patently unfair NOT to make OPS face the music and fix its own indebtedness, instead of forcing statewide taxpayers to bail them out.
To learn more than you ever thought you wanted to know about school retirement funding:
By Susan Darst Williams | www.GoBigEd.TheDailySusan.com | OPS | © 2017