Board hears proposal to ask ISBE to pursue Tier 2 pension reforms and optional DC plan

Board member Alex presented a pre‑recorded video and answered questions about a draft ISBE resolution that would ask the Illinois State Board of Education (ISBE) to pursue changes to protect Tier 2 employees from future safe‑harbor social‑security parity costs.

Alex said the proposal has three primary elements: (1) adjust Tier 2 pension formulas so benefits increase with inflation (removing the projected intersection where Social Security outpaces Tier 2 benefit growth), (2) reduce the standard retirement age from the current Tier 2 level to something considered more equitable, and (3) offer an optional defined‑contribution retirement option (a 403b/RSP style plan) with an employer match similar to what state universities offer. "If we input 7 and 1/2% each year ... we would meet the safe harbor compliance," Alex said, describing the optional defined‑contribution pathway as a choice employees could elect to avoid future district payroll increases tied to safe‑harbor rules.

Alex cited SURS data showing uptake of the university system’s retirement savings plan and suggested the option could attract and retain staff while helping districts control long‑term costs. Board members asked for additional perspectives, particularly from labor management, and staff said they would collect feedback before a planned submission window. The superintendent confirmed staff would work with labor management and return with an update by the board’s next meeting.

No vote was taken; the presentation was framed as a working draft and the board agreed to solicit broader input before deciding whether to submit the resolution to ISBE.