Illinois Retired Teachers' Association - Issue Overview
NOTE: This page HAS NOT BEEN UPDATED AT ALL because these issues HAVE NOT CHANGED for SSRTA Members. If any SSRTA Members wish me to update the TRS Economic Impact numbers contained below please email me a link to a trusted source.
Healthcare for Retired Teachers:
Many retired teachers in Illinois prepaid through active employee contributions to be able to receive a partial subsidy of their healthcare in retirement. This healthcare is provided through the Teachers Retirement Insurance Program (TRIP), and unlike retiree health insurance for state employees, the vast majority of the cost is paid for by retirees, active teachers and school districts.
Pensions for Retired Teachers:
Teachers receive a retirement annuity from the Illinois Teachers’ Retirement System based on their salary when they retire and the years of work they have performed. Typically, teachers receive estimates years before they retire, and plan their retirement according to their projected benefits. Unlike what is sometimes reported, most teachers work years, often more than 10 years, after they can first retire to make sure they will be able to maintain their retirement security. Unlike in the private sector, TRS is the sole source of retirement income for many teachers.
Cost for Retired Teachers:
Public Act 88‑0593 was enacted in 1994 and first affected state contributions in fiscal year 1996. The law established a 50‑year funding plan that includes a 15‑year phase-in period. By the end of the funding period in fiscal year 2045, TRS will have a 90 percent funded ratio. A key feature of this act is the “continuing appropriation” language that requires State contributions to be made automatically to TRS, provided State funds are available.
In 2012, the TRS Board of Trustees resolved to certify State funding requirements under generally accepted actuarial principles and standards. The vast majority of retiree costs the state faces today are a result of poor fiscal management in years past. The ongoing costs of healthcare and retirement security are not the issue.
Economic Impact of TRS:
The Teachers’ Retirement System of the State of Illinois annually distributes approximately $3.8 billion in pensions and benefits to men, women, and children in every corner of the state, creating a sustained economic stimulus that helps drive the economy in all 102 counties. This study is based on recurring payments to retirees, survivors, and disability benefit recipients living in Illinois.
The positive ripple effect of TRS benefits jumps by 46 percent to more than $5.584 billion in total economic activity throughout Illinois - new full-time jobs, salaries earned, and new goods and services produced across the state.
The study, conducted by TRS found that:
• 80 percent of the System’s 89,817 total benefit recipients live in Illinois.
• The $3.8 billion in pensions and benefits paid to Illinois residents is 83 percent of the total pensions and benefits distributed by TRS annually.
The statewide economic impact of TRS pensions and benefits can be measured in real terms including the overall measure of economic activity in Illinois stemming from TRS pensions and benefits is $5.584 billion. This includes TRS payments, salaries earned in those jobs, and increases in the state’s Gross Domestic Product. Also, there are 41,725 full-time jobs supported by the $3.821 billion in TRS pensions and benefits pumped into the Illinois economy.
What's Happening to Our TRS Pensions - report ROE #3 Institute on October 8,2021
https://www.trsil.org/sites/default/files/documents/OutreachPresentation2021-2022.pdf
Protect Illinois by Protecting its Promise to Retired Educators
Many retired teachers in Illinois prepaid through active employee contributions to be able to receive a partial subsidy of their healthcare in retirement. This healthcare is provided through the Teachers Retirement Insurance Program (TRIP), and unlike retiree health insurance for state employees, the vast majority of the cost is paid for by retirees, active teachers and school districts.
- Retired teachers receive a subsidy between 50% and 75% of their premiums
- As active teachers, they and their local employers prepaid much of the cost of healthcare
- Many teachers are not eligible for Medicare, and rely on TRIP as their only healthcare option
- The state contributes roughly $100 million per year to TRIP’s overall yearly budget of $450 million.
Pensions for Retired Teachers:
Teachers receive a retirement annuity from the Illinois Teachers’ Retirement System based on their salary when they retire and the years of work they have performed. Typically, teachers receive estimates years before they retire, and plan their retirement according to their projected benefits. Unlike what is sometimes reported, most teachers work years, often more than 10 years, after they can first retire to make sure they will be able to maintain their retirement security. Unlike in the private sector, TRS is the sole source of retirement income for many teachers.
- Many retired teachers are not eligible for Social Security benefits due to the state choosing not to participate in Social Security for educators.
- Teachers receive an average of just over $48,000 per year in benefits from TRS, for an average of 28 years of service. The average retired teacher is 70 years old.
- The benefits that retirees receive are based on calculations such as final salary, years worked, a multiplier amount and a cost of living adjustment, and these benefit levels are all consistent with other states that do not receive Social Security.
Cost for Retired Teachers:
Public Act 88‑0593 was enacted in 1994 and first affected state contributions in fiscal year 1996. The law established a 50‑year funding plan that includes a 15‑year phase-in period. By the end of the funding period in fiscal year 2045, TRS will have a 90 percent funded ratio. A key feature of this act is the “continuing appropriation” language that requires State contributions to be made automatically to TRS, provided State funds are available.
In 2012, the TRS Board of Trustees resolved to certify State funding requirements under generally accepted actuarial principles and standards. The vast majority of retiree costs the state faces today are a result of poor fiscal management in years past. The ongoing costs of healthcare and retirement security are not the issue.
Economic Impact of TRS:
The Teachers’ Retirement System of the State of Illinois annually distributes approximately $3.8 billion in pensions and benefits to men, women, and children in every corner of the state, creating a sustained economic stimulus that helps drive the economy in all 102 counties. This study is based on recurring payments to retirees, survivors, and disability benefit recipients living in Illinois.
The positive ripple effect of TRS benefits jumps by 46 percent to more than $5.584 billion in total economic activity throughout Illinois - new full-time jobs, salaries earned, and new goods and services produced across the state.
The study, conducted by TRS found that:
• 80 percent of the System’s 89,817 total benefit recipients live in Illinois.
• The $3.8 billion in pensions and benefits paid to Illinois residents is 83 percent of the total pensions and benefits distributed by TRS annually.
The statewide economic impact of TRS pensions and benefits can be measured in real terms including the overall measure of economic activity in Illinois stemming from TRS pensions and benefits is $5.584 billion. This includes TRS payments, salaries earned in those jobs, and increases in the state’s Gross Domestic Product. Also, there are 41,725 full-time jobs supported by the $3.821 billion in TRS pensions and benefits pumped into the Illinois economy.
What's Happening to Our TRS Pensions - report ROE #3 Institute on October 8,2021
https://www.trsil.org/sites/default/files/documents/OutreachPresentation2021-2022.pdf
Protect Illinois by Protecting its Promise to Retired Educators