Public Educator Pensions Build Strong Missouri Communities

Dear Supporters of Public Education:

For the past several years MRTA has been very successful in defending the PSRS/PEERS system in the legislature. 

The threats to your pension are real.  The Show-Me Institute spends millions of dollars misleading the public and legislators each year.  If the Show-Me Institute has their way teachers would be put into a 401(k) system which would be extremely detrimental to our pension benefits, public education, our children, Missouri’s economy, and our communities.  It has become clear that in the current political climate that MRTA needed to get ahead of any detrimental legislation, we needed to start “playing offense.” 

I reached out to Richard Phillips, MASA Emeritus member and an MRTA member, and asked him to create a document to explain why PSRS/PEERS matters to Missourians.  The attached document is what came from that discussion.  We must impress upon our elected officials and the general public the importance of educator pensions to children, to public education, and to our communities. We do not have millions of dollars to fight billionaires, but we do have great organization among our members!  THERE IS STRENGTH IN NUMBERS!

MRTA must be the lead dog in this fight!  There are many education associations in Missouri, we encourage membership in all of them.  However, when it comes down to it in a legislative battle MRTA is the only association where education retirees are the #1 priority.  The active educator associations’ priorities MUST be for active educators, it is a plain and simple fact. 

I want to especially thank MASA Members Emeritus and MRTA Members: Richard Phillips, Bill Elder, Terrence Stewart and the committee for their help in creating this document. 

Sincerely,

Jim Kreider
MRTA Executive Director
mrtadirectorkreider@mrta.org
1-877-366-6782

P.S. Please ask someone to join us in this fight today!  Membership in MRTA increases our STRENGTH IN NUMBERS! 

The world is run by those who show up!  Show up for MRTA!

ASK THEM THE HARD QUESTIONS!

Questions for Missouri House and Senate Candidates and Current Office Holders

When given the opportunity to ask policymakers questions use the questions below.

Missouri Education Pensions

  1. PSRS (Public School Retirement System) was formed in 1946 as a defined benefit pension plan (DB) to attract and retain the best and most experienced educators possible. Do you support the current defined benefit plan for educators and support staff which is similar to the defined benefit plan for the legislature and statewide officials? (a DB plan pays a monthly benefit for life, a DC plan pays you until you run out of money.)
    MRTA’s Position
    – MRTA supports a Defined Benefit Plan for educators as a way to attract and then to retain the best educated and experienced educators for our children possible.
  2. Would you support legislation that requires all new teachers and support staff to be placed into, or to be given a choice to opt into, a defined contribution plan (DC) such as a 401(k) vs. the current defined benefit (DB) plan (PSRS)? Did you support HB 864 of 2019 Taylor?
    MRTA’s Position – MRTA opposes 410(k)s or DC plans for educators and supports a strong DB plan. A DB plan is essential for attracting and retaining the best educated and experienced educators.
  3. Would you support maintaining the current independent governance and independent investment decisions of the Boards of Trustees of the following public education retirement systems: PSRS/PEERS Retirement System, PSRS of Kansas City, MO and PSRS of the City of St. Louis?
    MRTA’s Position – MRTA supports independent governance and opposes any kind of state take-over or consolidation of public retirement systems.
  4. Would you support consolidating the Public School Retirement System/Public Education Employees Retirement System (PSRS/PEERS) with another state retirement system? For example, consolidation through a State Investment Board. What are your feelings on the discussions of consolidating the MOSERS for state employees and MPERS for highway employees such as the Highway Patrol?
    MRTA’s Position – MRTA supports independent governance of public employee retirement systems and strongly opposes a State Investment Board.
  5. At times there is legislation that increases the cost of doing business or increases benefits of the PSRS/PEERS system such as certain Work- After-Retirement (WAR) provisions. Would you support legislation that increases the cost to the PSRS/PEERS system currently pre-funded at 84%?
    MRTA’s Position – MRTA opposes any new legislation that increases the cost of doing business for educator retirement systems.

Missouri Public Education

  1. Whether it is in the form of a voucher, tax credit, or other means, will you support spending public tax dollars to allow students to attend private schools?
    MRTA’s Position – MRTA opposes spending tax dollars on private schools. These schemes take scarce resources away from public education.
  2. Will you support the expansion of charter schools statewide as an alternative to traditional schools?
    MRTA’s Position – MRTA opposes charter schools. There is a lack of accountability to the taxpayer and Charters take scarce resources away from public education.
  3. Currently, Missouri is ranked 49th in the nation in beginning teacher salaries. How would you propose to raise the salaries of public school teachers?
    MRTA’s Position – MRTA supports legislation increasing the minimum salaries for beginning teachers and supports state funding to allow the increase.
  4. Legislators have fully funded the 2005 Foundation Formula for Public Schools the last two years. However, the State Adequacy Target (SAT) which is the baseline amount given to each district per student in schools was supposed to be recalculated every other year, but the SAT as of 2012 has been fixed at the funding rate used in 2005. Even with the $61 million additional revenue to the Foundation Formula this legislative session, those funds spread over the 567 school districts may not even cover the additional health insurance costs for school districts and is one of the reasons for low teacher salaries in Missouri. What would you do to adequately fund the Foundation Formula for Public Schools if anything?
    MRTA’s Position – MRTA supports full funding of the Foundation Formula and supports the Formula being updated to increase state funding for Missouri Public Education. MRTA opposes future tax cuts until this is accomplished.
  5. Transportation funding for public schools now stands at 15% funded. State policy states that transportation should be funded at 75% of transportation costs. What would your solution be to this inadequate funding of transportation that is particularly important to rural public schools?
    MRTA’s Position – MRTA supports funding of public school transportation to 75% which is the recommended level to draw maximum Federal funds. This is particularly important to rural districts.

MRTA Recruits Candidates

Members of the PSRS/PEERS Retirement System elect new members to represent them on the Board of Trustees every two years.  Members of the PSRS/PEERS Board are tasked with making decisions on behalf of you, its members.  MRTA is happy to announce we have recruited, endorsed, and are supporting Dr. Aaron Vitt and Dr. Kyle Collins as candidates for the 2020 PSRS/PEERS Board of Trustees. 

Dr. Aaron Vitt

Dr. Aaron Vitt is the Superintendent of the Paris R-II School District.  Dr. Vitt‘s  28 years of experience have given him the knowledge and skills to a diverse range of people to make decisions that are fair and in the best interests of all.  He understands how important the impact our pension system is for attracting and retaining quality teachers and support staff as well as providing a lifetime of financial security to retirees.

Click here to view Dr. Vitt’s resume.

Dr. Kyle Collins

Dr. Kyle Collins is Superintendent of Brookfield R-III.  Dr. Collins has 23 years of experience in education and as the son of a retired teacher understands first-hand how indispensable cost-of-living adjustments are to retirees.  Dr. Collins also understands that PSRS/PEERS is a prime recruitment tool and one of the best financial incentives we can offer to individuals considering a career in public education.

Click here to read Dr. Collins’s resume.

PSRS/PEERS Election Dates

February 24, 2020 – Deadline for Petitions to be Delivered

April 23, 2020 – Ballots will be Mailed to all PSRS/PEERS Members

May 8, 2020 – Voting Deadline

May 18, 2020 – Official Count and Certification

Sign up for Automatic Dues Payments and win $350

From now through July 31, 2019 if you sign up to pay your dues automatically via our Automated Dues Deduction program you will be entered into a contest to win a $350 MasterCard gift card (that’s equal to 10 years of MRTA membership) that you can use anywhere!

Click here or form below to print.  

We will draw your dues on October 1, 2019 for the 2020 membership year, unless your dues are already paid for 2020 – in which case see * below. When signed up for the automatic dues withdrawal we will automatically draw your $35 membership dues each year, you do not have to do anything!

*Dues will be drawn on or around October 1 of the year that your dues expire. For instance, if your dues expire on Dec. 31, 2020 we will draw your dues Oct. 1, 2020 for the 2021 dues year.

You can cancel at any time.

HB 864 – Most Dangerous Bill in 27 Years A Warning from Director Kreider

In Director Kreider’s 27 years of experience and involvement with the Missouri legislature, he has not seen legislation as dangerous as this to our pension benefits and pension system to-date.

UPDATE: HB 864 was not EVEN assigned to a committee! Thanks to YOU we have SQUASHED this legislation. Please stay tuned as the target will still be on us in 2020.

Dear MRTA:

HB 864 is a bill targeting educator pensions. Creating an “OPTION for all educators to get into a 401(k) plan. This is targeted to NEW HIRES. This is Sinquefield/Show Me Institute model legislation Introduced by none other than my own Representative Jered Taylor of Nixa. The PSRS/PEERS Systems are having the actuaries look at the bill. To put it simply: No money, no pensions. HB 864 will take away employee and employer contributions (currently 29% of payroll) from the system by allowing educators to OPT OUT the current system and into a 401(k). This will lower the amount of dollars for investment. Currently, 61 cents of every dollar paid to retirees comes from investment returns. Representative Taylor is using Show-Me Institute talking points and therefore is misinformed on how a Defined Benefits plan works. HB 864 is an attack on public education and educators.

If this type of legislation is passed it WILL:
1. Eventually, bankrupt our system. The system would run out of money in about 25 years. Fewer contributions will be paid into the system for investments which are needed to pay benefits. The average retiree uses the amount they contributed in less than 6 years!!

2. Immediately eliminate any future COLAs.

3. Likely result in benefit reductions by possibly 25% or more for current retirees.

4. Cause drastic increases in the contribution percentage paid by active vested educators Currently, they are paying 14.5%. This will be necessary to try to stretch benefits into the future. How much will active educators be willing to pay?

COMMENT: MRTA strongly opposes any legislation like HB 864 as it threatens pension benefits educators have worked so hard for. 401(k)s have been described as a “failed experiment.” Only 40% of Americans have any retirement savings. 401(k)s are at the mercy of the stock market. Do you feel lucky?! 401(k)s can be raided by individuals as life creates needs for cash. To be simply put 401(k)s do NOT offer retirement security. Our pension plan does! Our defined benefit system pays you until you pass. Now that is retirement security! But it takes everyone to participate. HB 864 was designed to divide and conquer us!

OUR job is to convince our own Missouri State Representative and State Senator to oppose this type of legislation. Stay vigilant in 2020. Educate your friends and family now. Ask someone to join MRTA today – “Strength in Numbers!” Legislation like HB 864 threatens our pension system and our pension benefits. Just leave us alone!

Please see recent articles regarding HB 864 and Representative Taylor:
Springfield News Leader Article Jered Taylor Comments – Feb. 15, 2019
Springfield News Leader Article Jered Taylor Comments – March 20, 2019

HB 864 -A Warning From Director Kreider

UPDATE: HB 864 has not been assigned to a committee as of today. SO far we have put the “brakes” on this legislation. Please stay tuned as the target is on us.

HB 864 is a bill targeting educator pensions. Creating an “OPTION for all educators to get into a 401(k) plan. This is targeted to NEW HIRES. This is Sinquefield/Show Me Institute model legislation Introduced by none other than my own Representative Jered Taylor of Nixa. The PSRS/PEERS Systems are having the actuaries look at the bill. There will be more information out soon on the affects to our pension system. I am very sure the expense to the system will be enormous. To put it simply: No money, no pensions. HB 864 will take away employee and employer contributions (currently 29% of payroll) from the system by allowing educators to OPT OUT the current system and into a 401(k). This will lower the amount of dollars for investment. Currently, 61 cents of every dollar paid to retirees comes from investment returns. Representative Taylor is using Show-Me Institute talking points and therefore is misinformed on how a Defined Benefits plan works. HB 864 is an attack on public education and educators.

This Legislation if passed WILL:

  • Eventually bankrupt our system. The system would run out of money in about 25 years. Fewer contributions will be paid into the system for investments which are needed to pay benefits. The average retiree uses the amount they contributed in less than 6 years!!
  • Immediately eliminate any future COLAs.
  • Likely result in benefit reductions by possibly 25% or more for current retirees.
  • Cause drastic increases in the contribution percentage paid by active vested educators Currently, they are paying 14.5%. This will be necessary to try to stretch benefits into the future. How much will active educators be willing to pay?
  • MORE TO COME as we study the legislation and get input from the PSRS/PEERS system and the actuaries.

COMMENT: MRTA strongly opposes HB 864 as it threatens pension benefits educators have worked so hard for. 401(k)s have been described as a “failed experiment.” Only 40% of Americans have any retirement savings. 401(k)s are at the mercy of the stock market. Do you feel lucky?! 401(k)s can be raided by individuals as life creates needs for cash. To be simply put 401(k)s do NOT offer retirement security. Our pension plan does! Our defined benefit system pays you until you pass. Now that is retirement security! But it takes everyone to participate. HB 864 is designed to divide and conquer us!

OUR job is to convince our own Missouri State Represenative and State Senator to oppose the bill. Ask them to VOTE NO! HB 864 threatens our pension system and our pension benefits. Just leave us alone!

Please see recent articles regarding HB 864 and Representative Taylor:
Springfield News Leader Article Jered Taylor Comments – Feb. 15, 2019
Springfield News Leader Article Jered Taylor Comments – March 20, 2019

MRTA Legislative Halftime Report

Great job so far, MRTA! Please remember, MUCH can happen before Session ends on May 17th. Please stay tuned, check your e-mail often, and please act on any CALL TO ACTION from your MRTA. We are here 24/7 to be YOUR PENSION WATCHDOG!

PRIORITY #1 – MRTA opposes HB 864 (Taylor Rep. – 139) Establishes a new retirement option for certain teachers in Missouri.

Click here for a report and talking points on HB 864.

  • Halftime Report – This bill has not been assigned to a committee as of March 28th. We have “put the brakes” on this legislation. GOOD JOB, MRTA!

PRIORITY #2 – MRTA supports HB 723 (Pike Rep.– 126) This legislation is an MRTA priority and allows pension benefits to “POP UP” after a divorce with the ruling on assets by a court.

HB 723 makes this provision retroactive for those divorced prior to Sept. 1, 2017. This bill is similar to HB 304 of 2017.

  • Halftime Report – Voted Do Pass Out of Committee. Awaiting floor debate

PRIORITY #3 – MRTA supports HB 77 (Black Rep.-7), SB 17 (Romine Rep.-3.) Exempts any person retired or receiving allowance from PSRS and employed by a public community college from current law related to working-after-retirement (W.A.R.) provisions.

  • Halftime Report – HB 77 will likely become law soon. Passed the House by consent and Senate Committee. Awaiting final vote of the Senate.

PRIORITY #4 – MRTA supports HB 69 (Dinkins Rep.-144). This legislation re-establishes the 2.55 factor for those working 31 years or longer.

This legislation has a positive financial effect on the PSRS system. The longer one works the fewer benefits that will be paid as one gets closer to death.

  • Halftime Report – No action.

PRIORITY #5 – MRTA supports full funding of the Foundation Formula and opposes the use of public tax dollars for private schools.

The Missouri Constitution mandates adequate funding of K-12 education through HB 2 which requires education funding as the second priority of state expenditures. Comment: Due to several tax cuts enacted by the legislature over the past few years general revenue is expected to be reduced significantly. MRTA asks funding for Public Education be the #1 priority.

  • Halftime ReportBudget debate by the House this week. The House has proposed fully funding the Foundation Formula – a $62 million increase! GOOD JOB, MRTA!

PRIORITY #6 – MRTA supports SB 78 (Sater Rep.-29) This legislation would restore to over 60,000 elderly Missourians state assistance for prescription drugs.

Many older MRTA members are at minimum retirement benefit and many are not eligible for Medicare. This legislation would be of great help to their quality of life.

  • Halftime Report – On Senate Calendar for debate and vote.

PRIORITY #7 – MRTA opposes SB 160 (Koenig Rep.-13). This act establishes the Missouri Empowerment Scholarship Accounts Program.

Comment: These are voucher schemes which create a new 100% tax credit allowing up to $25 million per year of state revenue to be used for private school tuition and other expenses for students. This will result in up to $25 million less state revenue for public education per year. These bills take scarce tax revenue away from public education.

  • Halftime Report – On Senate Calendar for debate and vote. Stalled at this time due to lack of votes and filibuster. GOOD JOB, MRTA!

PRIORITY #8 – MRTA opposes HCS/HB 581 (Roeber Rep. 34) and SCS/SB 292 (Eigel Rep. – 23).

Charter School Expansion – This bill would allow charter schools outside entities and operate in districts around the state. Charter schools are not subject to the same standards of accountability as public schools. Comment: Charter schools take scarce tax revenue from public education. Currently, charter schools are only allowed in St. Louis and Kansas City.

  • Halftime Report – On House Calendar for debate and vote. Stalled at this time due to lack of votes. GOOD JOB, MRTA!

PRIORITY #9 – MRTA supports and asks for legislation to allow a Cost of Living Adjustment for St. Louis City and Kansas City retired educators.

Currently, St. Louis City retired educators have not had a COLA since 2006. Their spending power has been significantly reduced. COLAs are essential to the quality of life of education retirees.

  • Halftime Report – No action.

Missouri Income Tax Deductions

Married couples with Missouri adjusted gross income less than $100,000 and single individuals with Missouri adjusted gross income less than $85,000, may deduct up to 100% of their public retirement benefits, to the extent the amounts are included in their federal adjusted gross income.  Click here for MO-A form.

  • The total public pension exemption was limited to $37,720 for each spouse for the 2018 tax year.
  • Married couples with Missouri adjusted gross income greater than $100,000 and single individuals with Missouri adjusted gross income greater than $85,000, may qualify for a partial exemption.
  • There is no age requirement for eligibility.

Health Insurance Premiums may be deductible too. Click here for more.

Visit www.dor.mo.gov for more information regarding eligibility. Or you may contact the Missouri Department of Revenue at (573) 751-3505, email income@dor.mo.gov or consult a tax professional for more information.