ST. PAUL (AP) — As school districts in Minnesota have allowed retirees to return to work in recent years, some say they are getting a deal on quality professionals, while others wonder if the educators are double-dipping — by collecting both a salary and a pension.
The St. Paul Pioneer Press reported Sunday that educators who draw both salaries and pensions have come under fire in many states. From California to New York, such employees have been accused of boosting their incomes by also taking a pension.
But experts say that in Minnesota, the number of retirees in public school jobs is very small. The vast majority earn modest incomes filling in part-time, and school districts are often desperate to put them in jobs that are hard to fill.
About 9,000 beneficiaries of Minnesota’s public retirement funds are back on the public payroll. This week, the Public Employees Retirement Association will present a report to its board on the impact that back-to-work retirees are having on the pension fund. A legislative pension committee plans to examine the issue this summer.
For some school districts, the retirees are a good solution. For example, last June, the superintendent, athletics director and high school principal in Redwood Falls all retired.
Superintendent Rick Ellingworth, who was 56 at the time, returned to work in the 1,180-student district in southwest Minnesota. He knew that with declining enrollment, budget issues and a freeze on teacher pay, his salary would remain stagnant, board member Tom Hollatz said.
But “we didn’t really want to lose him,” Hollatz said. “We have a more difficult time in rural Minnesota finding quality people.”
So in July, all three retiring administrators signed new contracts with the district. As retirees, neither they nor the district have to pay 6 percent contributions into the Teachers Retirement Association. They took salary cuts, including $5,400 a year for Ellingworth.
“That was a win-win for all of us,” Ellingworth said. The district is saving almost $85,000 a year with the new contracts.
And while Ellingworth now makes $113,900 annually, he also receives about $56,000 in pension benefits.
See TEACHERS, Page 5A
Retirees in the Teachers Retirement Association system can keep their jobs or get a new one with a public school. But if they make more than an earning limit of $46,000 a year, a portion of their benefits goes into a savings account they can tap only after ending public service. Ellingworth’s $56,000 annual benefit does not include the money set aside in a savings account for him.
Districts have long used retired teachers to fill substitute roles. But they began rehiring more retirees for full-time and part-time jobs four or five years ago, said Bob Lowe of the Minnesota School Board Association.
Charlie Kyte, executive director of the Minnesota Association of School Administrators said rehiring newly retired workers is good for everyone. He said educators tap the pensions they have earned, while districts save on pension contributions and can often negotiate pay cuts or freezes.
Besides, Kyte said, “the districts are only rehiring people whom they really, really value.”
“Those are the best of our people in education,” he said.
Byron Schlomach, a pension fund expert with the conservative Arizona-based Goldwater Institute, said the practice is not good for taxpayers.
“It’s sold as something that saves the taxpayers money, but the reality is taxpayers cover the whole thing,” he said. “It’s a way of robbing the taxpayer by stealth.”
The practice is double-dipping, Schlomach said, and if more public workers stop contributing to state pension funds before they quit working, it can put a strain on the funds.
Working retirees have been under scrutiny in other states, and some have greater restrictions than Minnesota. Arizona requires workers to take at least a year off before returning to work if they want to collect a pension while working. Nevada allows re-employment only if employers can show a “critical labor shortage” for the job.
Comments (25)
Add commentget all the facts!!
Although this is talking about T(teacher)RA, the case cited is not a classroom teacher, but a superintendent, the highest paid employee in every the district. 1. Classroom teachers benefits are not nearly this generous. 2. I don't know of any classroom teachers in MN who make $113,000 salary per year, without contracting for additional duties. 3. Teachers are required by law to put 6% into TRA, which the district matches. That money is invested by TRA. If every worker was required to do this from their first day of work until they retire, most would have a considerable sum for retirement. 4. Substitute teachers ( the job most retirees fill) earn between $75 and $120 per day.
I think this article is misleading, once again making out teachers to be greedy and overpaid. I spent 35 years teaching middle school. I spent my own time and money to earn a master's degree. I loved my job. I think I earned every cent I was paid as well as the retirement income I now receive.
Teachers under fire
Given that a very large number of teacher's leave the field for a variety of reasons in the first five years (one being that they can make double the money or more in the private sector without the expectation of constant additional training/education which they pay for out of their own pockets) and the fact that this is not a phenomenon exclusive to educators who BTW pay the same amount for food & groceries, car payments, mortgage payments, etc, as those who are not expected to do their job for the "love of the job" in order to not be accused of being gold diggers I don't see what the issue is here.
I have a family member who retired from the military younger than 56 who then went back to work at the same base as a civilian employee while collecting full benefits and now makes twice the money he did while in the military. I have another family member who retired from the engineering field, collects social security (which he paid into just like the teachers pay in to their retirement accounts) and went back to work doing the same thing for the same firm. Like social security they are expected to pay in when they return to work in their earnings reach a certain level.
So I guess I'm wondering - is the issue here really "double dipping" which gives students the benefit of their experience as well as school districts paying less for it or is it just because they are teachers? I can't imagine going back to teaching if they didn't truly love what they are doing given what teachers are expected to put up with.
Yes, I did used to teach and no, I do not collect from teacher retirement but I remember a day that the district I worked in refused to close for a snow storm even though many students and staff couldn't get there. As a result one of the social workers was sent in to cover a classroom. His comment when he came out? "I have never been in a classroom (to sub) in my life and I have never been so disrespected in my life."
last sentence of the third
last sentence of the third paragraph is all that really matters: :"school districts are often desperate to put them in jobs that are hard to fill."
Simple supply and demand. Really, same concept as the private sector id a business really wants someone's expertise: show them the money.
I know, Sleepr, who needs all that science and math stuff anyway.
cost effective
The cost to rehire the supt. saves the district in moving and benefit expenses. It gives them a financial savings. That is what it is all about. Some districts don't let retired teachers sub for a year upon retirement or sub in their former school. Now that is silly.
For what part do you not
For what part do you not understand that there may be a cost savings and/or difficulty filling the position? As a taxpayer, I would have expected you to be on the side of financial prudence.
Think of the money saved by not retraining thse people, as they tend to know the system more than most. Think of the fact that a student can take a Physics class because a teacher can be found for the position.
Ahhh, Sleepr, can we please have one post from you where you don't resort to the 'ol blame the union card?
Educators
Will someone please enlighten me. Why are the positions so hard to fill with unemployment at an all time high and college grads beating the bushes looking for work. This is double dipping at it's finest of which the burden falls on guess who -- the taxpayer!
Lorizen
I doubt a first year teacher could be a superintendent. But maybe there are some unemployed people in the private sector who are looking for a career change into teaching. In some states they don't need teaching degrees. And recent legislation in MN has made it easier to obtain a teaching license. If a person gets a pension and a salary, they still only have one health insurance policy and that is a savings. And they can hire retirees as part time teachers etc., whereas most younger people need and want full time jobs. I have seen area districts do this for years.
Say what?
"BTW: hows that old "it's for the children" punchline working for ya?"
Wouldn't know. I never have said it. And when is the last time you heard a teacher defend a superintendent?
Is it sad or funny how the far right wants to use the private sector as the basis for how education should be run . . . . until it is thrown back at them.
from Evergreen
"And recent legislation in MN has made it easier to obtain a teaching license". This, I believe, will do wonders for the teaching profession. While the union is against the new legislation, I predict that it will reinforce to the mainstream public that teaching isn't the cushy job many portray it to be. Plus, when these 6 week of teaching school grads make it to the profession, the wakeup call will be so intense, that there is going to be even more turnover.
In the end, I think teachers will benefit by being once again respected as a profession.
Heres to a good future!
smart guy
You are so right! When those physicists and accountants head into the classroom, they are going to have their eyes opened! Maybe they will appreciate what teachers have to do.
evergreen & Smartguy
So true!! It's not all about the physics and the accounting. It's about the teaching of physics and the teaching af accounting. Good luck to them!
Smartguy, et al, Those folks
Smartguy, et al,
Those folks will bring real world experiences and diverse backgrounds that those who have been caught inside the union bubble since college can not bring to the table. I see it as a good thing.
"Those folks will bring real
"Those folks will bring real world experiences and diverse backgrounds that those who have been caught inside the union bubble since college can not bring to the table. I see it as a good thing."
Well, if that doesn't portray how you really feel about teachers, I don't know what else does. 'Real World experiences?' Spend a week shadowing a teacher and then talk about real world experiences. Haven't you noticed the extra responsibilities put on schools because others don't weant to deal with their own realities? Is "real world' some euphamism for the business world?
Talk about an ignorant statement then only to be further enhanced by your "blame the union' cliched blame game. I expected better, Herc. I worry that your falling from grace to the levels of Sleepr. I have faith you'll catch yourself before it gets ti that point.
southnet
"They like their sheep trained well!"
Out of curiosity, do you listen to Talk Radio? Come on - don't b.s. me here.
It's a "win-win"
What is the big deal here? Ellingsworth should be praised for saving his school district $85,000!!!!!!!! Do you know what this means? There was no need to cut teachers. Heck, with an excess $85,000, they might have been able to add a position! Lots of people go to work after they retire. I don't understand why this is news, and I especially don't understand why there are complaints about this. Southnet1, the man making $113,000 is a Superintendent, not a teacher; a Superintendent who helped save his district $85,000! I applaud him for taking action when our society continues to fail in offering appropriate funding for the education of our youth.
When you have it good...
Every occupation has it's ups and downs smart guy. Own a business or work on a commission and then decide what side of the fence is greener.
failing society or common sense???
How much of the pie is needed to properly fund education? All of it? Break the cost of education down. What is the highest percentage of costs? Time has passed when the simple solution is to raise the price or in this case taxes, of your services or product(s) that are offered. I'll ask this question...Would he do just as good job if he was making 95K ?
jjwilson
Where did I mention or hint of anything about envy of the private sector? Your comment at 10:22 pm baffles me as to what spurred it.
As for the financial questions you pose, I actually agree that education is highly funded. The method of funding is what needs to be fixed, not the amount of funding.
As for the $95,000, my work ethic is not dependent on income. It is what it is. However, I'd think twice about teaching (or do any other job) if I can make more money elsewhere.
By the way, how many accountants and scientists are willing to take a pay cut to teach in a public school? Kudos to those who make that decision.
...best to keep it to yourself.
Maybe double dipping accountants and scientists would welcome the additional income. :)s
Perhaps you are correct on the funding issue. Hard to get change when one must be in handcuffs and shackles and do a job that is open to public opinion. Kinda like a .300 life time hitter being ripped by a sports reporter for not hitting .350. If the method needs to be changed to get the results, I'd say promote that rather than complain about how hard it is to conduct your daily business.