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INN investigation: Rockford schools pays more than $1 million in penalties for inappropriate spending

In February, Rockford School District 205 Superintendent Ehren Jarrett told a local television station that Gov. Bruce Rauner’s proposal to make local districts share more of their pension costs would leave his district strapped for cash.

“I’m worried that we won’t gain new dollars and in Rockford, where we’ve gone six years without raising property taxes, that puts tremendous pressure on local budgets,” he said.

Referring to the pension shift, Illinois Education Association President Kathi Griffin said “…the pension costs [Rauner] wants to shift to school districts and our public universities will starve our schools.”

During that school year, RPS 205 paid $171,761.18 in penalties for giving soon-to-retire staff employees more than six percent raises or paying them them for accumulated sick days that state law deems excessive. The taxpayer-funded penalties went directly to the Teachers’ Retirement System of the state of Illinois.

Since the 2013 school year, the Rockford school district has paid more than $1.1 million in excess pay increase or sick day penalties, according to TRS documents obtained by the Illinois News Network under the state’s public records law. The district serves 27,000 students on a $370 million annual budget, making it the fifth largest in the state.

Of all the state’s school districts, Rockford 205 has paid the most in penalties since 2013.

The district paid 201 excess sick leave day penalties. Some of the excess pay penalties were for large sums, the highest being $78,000 for Vikki Jacobson, a retired assistant superintendent of elementary education. She was promoted in 2013 to an annual salary of $135,000. The district paid for her pension penalty in 2016, in the midst of the state budget impasse. She was paid $153,812 in 2016, according to public records.

State law required that school districts pay related pension spikes on any raise given to a school employee vested with TRS or the State University Retirement System of more than six percent. The penalty payment to the pension fund must equal the calculated additional cost that the teacher will receive if they live out their actuarial lifespan. This is meant to deter schools from spiking pensions and leaving the state to fund the bill.

Jarrett, as well as school board president Kenneth Scrivano, did not respond to questions about why the raises and sick days were given to employees even though the district would have had to pay the penalty.

The state budget for fiscal 2019 changes the threshold of excess pay penalty to 3 percent, down from 6 percent.

The Illinois Federation of Teachers has created a petition opposing the change.

Rockford Public Schools will receive $8.6 million in additional state funds this year after the new funding formula takes effect.