"Deferred Compensation" for K-12 Employees Needs a Lot of Piggy Banks
I’m pretty smart for a 5-year-old. But sometimes I wander into a topic that’s just over my head. That doesn’t mean it’s not important, but it’s probably just best if I let the big people talk about it themselves.
My friends in the Education Policy Center released a new Issue Paper today, called Deferred Retirement Compensation for Career K-12 Employees: Understanding the Need for Reform (PDF). It was researched and written by Dr. Michael Mannino from the University of Colorado Denver.
Rather than try to explain the paper myself, here’s the summary from the Independence Institute website:
To improve understanding of public K-12 retirement compensation, this Issue Paper provides historical estimates using a substantial sample of retiree characteristics and salary histories. Deferred retirement compensation from a hybrid defined benefit plan is defined as the difference between an employee’s estimated retirement account balance and the greater pension value she expects to receive. When accounting for K-12 employee compensation, large amounts of deferred compensation should be included. For the 846 Denver Public Schools retirees in the sample, average lump sum deferred compensation is $627,570.
Wow, it would take a lot of piggy banks to put that much money in. But I think I get it a little bit now. One of the main points is we could definitely do a much better job of how we pay our teachers, principals, and the other people who work in our public schools. The current system isn’t cutting it, at least not in the best interest of students like me who our schools are supposed to serve.
If you don’t have time to read the report, or you have read it and need some clarification, you really ought to listen to this podcast conversation with Dr. Mannino:
The author has some good, reasonable recommendations to make. Isn’t there a way we can fix this?