Northwest Herald | Schaumburg: Here's why pensions need fixing

Findings from TUA’s Illinois pension project are featured in this story from the Northwest Herald.
schaumburgNWHThe public pension news this week didn’t originate out of Springfield, where lawmakers wasted another week without passing real reform.

Instead, pension news originated out of Chicago and the Taxpayers United of America’s annual study of the top government pensions in Illinois.
This year’s study expanded to look at the top 200 government employee pensions. In the past, TUA’s list included the top 100. The group, led by president Jim Tobin, said it included the second 100 pensioners because there are so many six-figure pensions. In fact, the top 200 pensions are all over $189,000 per year.
No. 1 on the list is Tapas Das Gupta, who retired from the University of Illinois at Chicago. Gupta received a pension payment of $439,672 last year. To date, Das Gupta has collected $3.4 million in pension payments. TUA estimates he will receive a lifetime pension payout of $5.3 million based on a life expectancy of 85 years old and a 3 percent cost-of-living adjustment compounded annually.
If you think Das Guptas’ lifetime payout seems high, let me introduce you to Larry K. Fleming, who retired from Lincolnshire-Prairie View School District 103 at age 55.
Fleming last year received a pension payout of $258,163. His estimated lifetime pension payout is – wait for it – $11.9 million. That is not a typo. Of that nearly $12 million, TUA reports that Fleming’s employee contribution is 2.8 percent.
Fleming’s pension payout last year didn’t make the 2012 top 10 list. He wasn’t even in the top 20. Of the top 10 pension payouts last year, nine retired from UIC. The lone non-UIC employee was Beverly Lopatka, who retired from DuPage High School District 88 and checked in at No. 4 with a pension payout of $399,652 in 2012.
Lopatka gives Fleming a run for his money when it comes to the race for top estimated lifetime payout. Because she retired at age 56, her estimated lifetime payout is $11.5 million. And if you thought Fleming’s employee contribution toward his lifetime payout estimate was low, get a load of Lopatka. She checks in with an employee contribution of 0.8 percent.
I’m clearly in the wrong business.
Locally, retired District 300 Superintendent Norm Wetzel remains the most compensated public retiree in McHenry County. Wetzel, who retired at age 55, had a pension payout of $232,370 last year. He’s collected $2.1 million in pension payments to date and has an expected lifetime pension payout of $7.9 million.
He’s the only local retiree to make the top 200.
These clearly are the most extreme examples when it comes to pension payments in Illinois. There are far more people pulling in far more modest pension payouts.
But these examples illustrate why the system is broken. They demonstrate the unsustainable pension system that has been built and desperately needs fixing.
As has been the norm, we sit and wait for state lawmakers to do something about it.

9,900 Illinois Government Pensioners With Annual Pension Over $100k

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Chicago—Taxpayers United of America (TUA) today released the results of its annual study of the top government pensions in the State of Illinois.
“Illinois House Speaker, Michael Madigan (D), and Senate Majority Leader, John Cullerton (D), continue their political charade of pension reform while the number of six-figure pensioners grows 47% in one year to 9,900”, according to TUA president, Jim Tobin.
“Illinois is quickly running out of time to deal with the government-created crisis of unfunded pension liabilities. Madigan and Cullerton engage in a carefully choreographed pension reform debate that provides political cover for their allegiance to the union bosses who keep them in power.”
“The reality is that they have crafted legislation packaged as sweeping reform that will do more harm to taxpayers than no reform at all. The Madigan version of pension reform will provide a funding guarantee that places the cost of this elite group of government pensioners squarely on the backs of taxpayers and make these outrageous pensions the first priority of the budget – before any other services or obligations of the state.”
“Real pension reforms were proposed in HB3303 which was introduced by representatives Tom Morrison and Jeanne Ives, but that bill did nothing to help the union bosses maintain favor with their rank and file and was quickly rejected by Boss Madigan.”
“The purpose of our study is to put some perspective around individual pensions, to put them in terms to which the average taxpayer can relate. Illinois taxpayers, whose average household income is $53,234, and struggle with 9.3% unemployment need to know how much Illinois’ government retirees are being paid not to work and the astronomical accumulation of those payments over an average lifetime.”
“We actually expanded our list from the top 100 to the top 200 since there are so many six-figure pensioners now. The top 200 are all over $189,000a year.”
“Still topping our list of Illinois’s government elite in annual payouts is Tapas Das Gupta, retired from the University of Illinois at Chicago. He collected a cool $439,672 in his last annual pension payment and will accumulate a stunning $5.2 million in lifetime pension payments.*”
Beverly Lopatka retired from DuPage Government HSD 88 at the ripe old age of 56 and has an annual pension of $399,652, with a staggering estimated lifetime payout of $11,524,643. Her contribution of the estimated lifetime payout would be only 0.8%.* ”
“The highest lifetime payout estimate goes to Larry K. Fleming, retired from government school district Lincolnshire-Prairie View 103. Having retired at the age of 55 with a cushy annual pension of $258,163, he will accumulate a breathtaking $11,868,155 in pension payments over a normal lifetime.”
View Pension Amounts Below

“Illinois’ financial condition is in the tank. We have the worst credit rating, the highest unfunded pension liabilities and one of the highest unemployment rates in the country. We had a net loss of 74,000 productive, taxpaying residents last year.  What does it take to get serious about pension reform that will solve problems, not create new ones?”
“Without sweeping and immediate reform, Illinois’ government pension system will collapse by 2015. It’s mathematically impossible to tax your way out of this problem. Illinois has more than 9,900 retirees collecting more than $100,000; in 2020, that will be over 25,000 six-figure pensioners. Real pension reform must include raising the retirement age to 67, increasing employee contributions by 10%, increasing healthcare contributions to 50%, eliminating all COLA’s, and replacing the defined benefit system with a defined contribution system for all new hires.”
*Lifetime estimated pension payout includes 3% compounded COLA and assumes life expectancy of 85 (IRS Form 590).