Superintendent Offered New Contract

At yesterday's meeting of the Minooka CCSD 201 school board, the school board voted (by a 5-2 vote) to offer the current superintendent, Mr. Al Gegenheimer, a new four-year contract (click here for a copy of the proposed contract; see subsequent post for more information).  Those voting "yes" were Skwarczynski, Hannon, Budde, Carlson and Satorius.  Those voting "no" were Brozman and Martin.  The new contract, which purports to take Mr. Gegenheimer up to his retirement, includes a 6% raise for each of the four years of the contract.  This is after the school board voted at the January 2012 meeting to increase the superintendent's salary by 3% for the 2011-2012 school year, retroactive to July 1, 2011 (another 5-2 vote, with the same members voting "yes" and the same members voting "no").  The salaries over the four years of the new contract would be as follows (the superintendent's current salary for the 2011-2012 school year is approximately $136,269):

2012-2013:  $144,445
2013-2014:  $153,112 (approximate based on 6% raise)
2014-2015:  $162,298 (approximate based on 6% raise)
2015-2016:  $172,036 (approximate based on 6% raise)

A little quick math tells you that the final projected salary of $172,036 represents an increase of approximately 26% over the superintendent's current salary.  If you include the 3% retroactive raise from January of this year, the $172,036 represents an increase of approximately 30% over the superintendent's salary at the end of the last school year. 

In addition, the new contract provides for three annual post-retirement payments equal to 20% of the superintendent's final annual salary.  So, assuming a final salary of $172,036 as projected above, the three annual payments would be $34,407 each.  That is, the taxpayers of Minooka CCSD 201 will be paying the then former superintendent $34,407 each year for three years at the same time he is collecting a pension of up to 75% of the average of his highest four years of salary from the Teachers' Retirement System (approximately $118,480 based on these assumptions).  Keep in mind also that in addition to paying the then former superintendent, the taxpayers of Minooka CCSD 201 will be paying the salary of a new superintendent as well.

The contract also provides for the school district to provide the superintendent with health insurance (hospitalization/major medical) during his retirement until such time as he qualifies for Medicare (typically at 65) or becomes employed by another employer offering health insurance coverage.  This means that if the current superintendent retires at the end of this agreement, the school district would be obligated to provide him health insurance for approximately five years.  At the time that the proposed contract was voted on, it was unclear whether this provision was legal.  As a consequence, the motion that was voted on provided that the proposed contract be accepted pending further consultation with the school district's attorneys.  Since the proposed contract was presented to the school board for the first time at some time after 10 p.m. on the night of the meeting, it would have been difficult to consult the school district's attorneys before the vote was taken.

For those who like to put the pieces together and see the big picture, see my previous posts regarding financial projections, unsustainable spending, and underfunded pension systems.  The most difficult thing about being an elected official is that it is easy to spend other peoples' money (Margaret Thatcher had a famous saying about spending other peoples' money).  It is much more difficult to enforce discipline.  There is something akin to a moral hazard at work.  If you need proof, you can merely look to the budget deficits of the federal, state and local governments.