ATLANTA -- Senate budget writers are wondering whether it makes sense to pay retired teachers to return to work while still collecting their pension.
Roughly 15 percent of retired teachers were back on the job at public schools in fiscal year 2009, according to a report released Friday by the Department of Audits & Accounts. The Senate Appropriations Committee requested the report about the Teachers Retirement System, the largest pension plan administered by the state, which includes local teachers and college professors.
Because full retirement is available after 30 years on the job, it’s possible to retire earlier than age 65. The auditors calculated that someone retiring at age 57 who went back to work till age 65 would earn more than simply staying on the job until the same age.
That’s after taking a required one-month break in pay following retirement and then working no more than part time for the next 12 months before returning to full-time status. The auditors found that most other states have similar plans for teachers.
“These situations highlight why Georgia needs to reform its pension program for teachers,” said Kelly McCutchen, president of the Atlanta think tank Georgia Public Policy Foundation. “The system allows its members to draw significant retirement benefits in their 50s, when most private pension plans consider 65 to be the normal retirement age.”
The report shows that the average annual pension for the 12,000 working “retirees” was $38,000 while they were earning another $23,000 on the job.
However, the arrangement doesn’t cost state taxpayers any more since someone would have been paid doing the same job if not the retiree, the auditors concluded.
“The audit team identified no significant costs to the retirement system since the re-employed retiree has already earned his or her retirement benefit,” the auditors wrote.
A retiree working full time no longer pays into the system, nor does the state. Instead, the local school system does, and those in Columbia and Gwinnett counties cut the retiree’s pay to reflect it.
If they retire and work for outside of professions covered by the Teachers Retirement System, there are no restrictions on earnings.
The shortage of teachers, especially in urban and rural districts, prompted the General Assembly to create a door for retirees to re-enter the classroom. The fear then was that a flood of retirements would worsen the shortage.
In 2002 when retired teachers were first allowed to go back to work, the option was restricted to 600 low-performing schools and limited to five years of re-employment. Two years later, it was opened to all schools with no time limit and expanded to include principals, counselors and librarians.
Senate leaders on recess this week didn’t respond to inquiries about their plans for this information. With just three work days left in the current legislative session, any proposed revisions would be likely to wait until next year.