Letter to the Editor: Action needed to end pension fund madness
For a very long time now, school directors and business managers have been sweating out the ever-increasing pension fund payments in the annual school budget. I don’t believe the tax-paying public of all school districts in the state are as aware of this ever-growing mess.
Since yearly pension fund payments have been enlarged because of state-mandated percentage ratios, the ballooning figure is driving taxes beyond reasonable levels.
For example, in the Indiana Area district a few past years ago, the percentage figure was about 3 percent on about $16 million in total teacher annual pay. Since the state picks up 50 percent of the calculated figure, the budget had to account for an approximate pension payment of $240,000. In 2013, the percentage has been raised to 16.9 percent and on a teacher payroll now with $22 million, the fund payment is about $1,870,000; and in 2014, 21.4 percent of approximately $23,100,000 will be about a $2,470,000 payment.
Imagine. In about 10 years, the obligated figure for the Indiana Area School District has gone from about $250,000 to almost $2.5 million. The projected figure for the percentage ratio in five years, escalating each year, is 31 percent. If we presume that teacher salaries escalate 5 percent per year for five years, the payment can reach to about $4,340,000.
Legislators Sen. Don White and Reps. Dave Reed, Sam Smith and Jeff Pyle must come to the aid of districts and taxpayers and work with their compadres to right this ship. This plan is grotesque and no increase of taxes or elimination of academic courses or schools will ever make up for the pension grab of 2005 or the vast drop in stock market value, which decimated the value of the fund after the recession. The taxpayers are getting tired of pushing the rock up a hill.
Some have suggested a state bond issue in the amount of the pension fund deficit. Whatever the Legislature decides, do it now. Stop the madness of the present system long before its ratio is 50 percent. We taxpayers want off this train.