Hilmer owes an apology to educators, retired Mehlville teacher says

To the editor:

This is an open letter to Aaron Hilmer, regarding his “Another View” column published by the Call on Aug. 25.

As a retiree who taught 31 years in the Mehlville School District, I call on you to offer an apology to teachers and other employees of the public schools, as well as the citizens of St. Louis County for the misleading and in many ways derogatory comments you have made relative to the Missouri Public School Retirement System.

Missouri’s public school teachers and certified administrators who are part of PSRS do not pay Social Security taxes, nor do they receive Social Security benefits. Since federal law does not allow for individual members to elect Social Security participation, teachers cannot voluntarily pay into Social Security.

If they have been employed in another occupation from which they have accumulated 40 units of Social Security, those benefits will be significantly reduced. Thus, their teacher retirement income provides the primary source of income for many retirees.

The Missouri Public School Retirement System is not, as you have charged, a Ponzi or fraudulent investment scheme. It is a defined-benefit plan that was created by state statute to provide retirement, disability and survivor benefits for Missouri’s public school teachers and their families.

The system is funded by employee contributions — which this year will be 14.5 percent of their salary — matching employer contributions and investment earnings on those funds. It was projected to be just over 80 percent prefunded as of June 30 this year.

This means that it has assets on hand equal to 80 cents of every dollar owed in benefits. Such a system is considered very healthy by the pension industry as a whole, as well as the Legislature.

Upon retirement, a teacher’s benefit will be based on the average of salaries received during the last three years of employment.

Although cost-of-living allowances may be added to the retiree’s annual benefit, recent economic conditions have resulted in that not being the case recently for retirees in this as in many fields.

The average annual benefit paid to PSRS retirees in 2010 was $38,300. That hardly fits your description of “unfair and expensive pension benefits for school district employees,” which you based on only one example and that a pension earned by someone who served as superintendent of a large metropolitan school district; a position comparable to that of a CEO in the business world.

Members of the Public School Retirement System are well aware of efforts to replace the system of defined benefits with a system of defined contributions. Those efforts would replace the PSRS with an alternative system that might offer a 401(k)-style retirement plan. Such a switch would put retirees and their families at great risk since PSRS is, as mentioned above, the primary source of income for many of them.

Jo Litto