In our last two blog [PERS Reform: Money Match Makes Pension Costs Rise to Unaffordable Heights] posts [PERS Reform: Budget Woes Are Hurting Teachers and Students], we discussed the major problems facing Oregon’s Public Employees Retirement System (PERS), and how PERS’s problems are affecting teachers in Oregon’s public schools. In this post, we will look at the issue from the so-called ‘union’ perspective – the perspective of teachers’ union activists, and many retired and almost retiring teachers.
PERS’s problems, including the sharply rising pension costs that have come from its Money Match program, have made it an obvious target for reform. Money Match has been very generous to a certain generation of Oregon teachers – ones who were hired before August 2003 and benefited from the stock market boom between the 1980s and 2007. For many of them, their pension checks amount to almost 100% of their working salary, and they receive annual cost of living adjustments that increase even more the amount paid out to them. In one case, a former law professor in Oregon is actually receiving 310% of his final salary in pension checks.
While many find these numbers troubling, if not outrageous, not everyone feels that it is fair to target public employee pensions in order to provide more money for schools. Firstly, former teachers like Ken Reiner feel that a good pension is nothing more than what was promised to him. Reiner taught for 32 years, largely at Jackson Middle School, and worked as a substitute teacher for another eight years before retiring in 2003. He contends that his salary was never in line with his education and credentials; he has a master’s degree as well as 45 hours worth of graduate work in education. Like Claire Morgan – another 32 year teaching veteran, who was told when she began teaching that she wouldn’t be making the salary she deserved, but that the pension was good – Reiner argues that the generous pension payouts under PERS almost act like delayed compensation.
In addition, many teachers, including Morgan and Reiner, feel that it is unfair to focus so much blame on PERS costs when the state’s budget problem is so much larger than just the pension issue. Reiner says that Oregon has a ‘moral obligation’ to hold up its end of the pension bargain, no matter what the courts decide is legal in terms of PERS reform. Morgan is more flexible, but no less frustrated. She says that she is willing to see her pension reduced in order to have more money put back into schools and fewer teachers laid off – but she is aggravated by the fact that public employees alone are being asked to sacrifice for the sake of children’s education in Oregon. Both feel that cutting from teachers’ pensions is a temporary fix to a larger state budget problem, whereas other plans – like instituting a sales tax in Oregon – might be a more permanent solution.
In a corollary to the argument that teachers deserve a good pension plan for years of service with sub-level pay, the ‘union’ perspective notes that one of the only ways of keeping good teachers is the promise of a good pension, which can as the ‘light at the end of the tunnel.’ While some teachers who are not near retirement age might argue that that light isn’t bright enough to get them through the tough years in the trenches, it is debatable whether it really is fair to ask retired teachers who have already sacrificed during their working years to sacrifice in their retirement years as well.
The issue of PERS reform is a complex one, with strong arguments on each side. In our final installment in this series, we will explore which arguments have been most persuasive to lawmakers in Oregon, and what steps the governor is taking to reform PERS. In the meantime, if you or someone you know has any questions about how PERS reform might affect your pension rights, please contact one of our attorneys to help guide your inquiry.