Lawrence teachers, along with others in state, face tough decisions after KPERS rules changes

Kansas Public Employee Retirement System (KPERS)

After 30 years of working as a teacher, Charlotte Anderson had reached the age eligible to retire and start taking benefits from the state pension plan she’s been paying into throughout her career. But she didn’t think she could. Anderson said retiring completely would have meant she’d receive approximately $15,000 less per year. That wasn’t practical, so like many state employees, she planned to spend the first several years of her retirement working.

“It’s difficult to save on a teacher’s salary. It would have allowed me to save up more money for retirement, to have some money built up, so that retirement could be more comfortable financially,” Anderson said, noting that her benefit would have been about $3,000 per month.

Anderson’s plans have since changed. The Kansas Legislature recently made changes to rules for the Kansas Public Employees Retirement System regarding working retirees that apply to many state employees, including teachers.

Under the new rules, which apply immediately to licensed school professionals who retired after April 1 of this year, once a working retiree reaches the earnings limit of $25,000, that person is required to choose between receiving benefits from the KPERS retirement plan or continuing to work, according to the KPERS website.

KPERS, which was created by the Kansas Legislature in 1962, is a mandatory pension plan that is funded through employee salary deductions (plus annual interest) and state contributions. Employees contribute 6 percent of their salary, and a benefit amount is determined at the time of retirement by multiplying their final average salary, a statutory rate of 1.75 or 1.85 percent and their years of service. For instance, for someone retiring after 30 years with a final salary of $40,000, the yearly benefit would be less than $25,000.

The previous rules placed less restriction on teachers who worked while retired or returned to teaching after retirement. The new legislation may lead to teachers leaving the profession or the state, or discourage retired teachers from returning to work and helping to alleviate teacher shortages, said Laurie Folsom, president of the Lawrence Education Association and a teacher at Free State High School.

“That’s where I think our kids really lose out, when there are shortages and there are changes that mean that teachers might not be able to come back after they retire,” Folsom said.

Anderson may be one of those teachers. After the new rules were adopted, Anderson rescinded her retirement in favor of continuing to work for the Lawrence school district for at least another year, but after that, her plans are uncertain.

“I based quite a few financial decisions on [the previous rules], so I really kind of got stuck,” said Anderson, who next year will work as the library media specialist at Lawrence High School, but said she is considering looking for a nonstate job or going to teach in a different state.

“I have to readjust and figure out what’s best for my family,” she said.

‘Teachers are judged’

The new rules, however, don’t affect all state employees the same way. There will be no earnings limit for certain professions — a list that includes local elected officials and legislative staff. Other professions with no earnings limit are state hospital nurses, emergency substitute teachers and law enforcement officers employed by the Law Enforcement Training Center. The working-after-retirement rules do not affect judges or the Kansas Police and Firemen’s Retirement System.

For Folsom, such differences in the application of the rules speak to a larger issue. What is considered fiscally responsible or financially savvy for other professions, Folsom said, is construed as somehow selfish when it’s a teacher.

“I think that there’s a lot of professions where people’s skills are valued and they are able to retire and then go back and work in that same profession,” Folsom said. “I think teachers are judged for it in a way that other professions aren’t.”

Looming choices

For licensed school professionals who retired before April 1 of this year, there is what amounts to a two-year grace period. Those workers are temporarily grandfathered in until July 1, 2017, after which the new rules apply, requiring those teachers and administrators to choose between taking benefits and working.

Joyce Tallman began receiving her KPERS benefit when she retired from the Baldwin City School District in 2008. Tallman, who began working for the Lawrence School District that same year, said that once the two-year grace period is up, she has chosen to retire completely. Tallman said that if it hadn’t been for the rule change, she probably would have chosen to stay teaching beyond that time.

“I enjoy what I’m doing, and I think I’m good at it, but I had to make a decision,” Tallman said.

Those decisions create some staffing uncertainty for Lawrence schools. Currently, there are 36 working retirees in the Lawrence school district, said David Cunningham, the district’s director of human resources and legal services.

“We don’t know what those employees will choose to do in two years or whether the Kansas Legislature will change the legislation again,” he noted.

Although the new rules could potentially increase the number of teacher vacancies as the changes go into effect, Cunningham said, the district would address them.

“We would post, interview and hire replacements for those positions,” he said.

The new rules do make some exceptions for special education and certified “hard-to-fill” school positions. For instance, there is no earnings limit for three years as long as the employer shows “ongoing, documented recruitment efforts.”

While Folsom said the changes may only directly affect those teachers in the later phases of their careers, they will continue to be an issue as more teachers get closer to retirement.

“It does affect a smaller segment of our teaching community, but all of us are going to be there at some point,” she said.