by Patrick O’Donnell, The Plain Dealer
Sarah Zatik retired two years ago, at the age of 53, but she never stopped working.
The Parma schools superintendent immediately was rehired into the same job. It was all pre-arranged, just a matter of paperwork.
The bookkeeping move brought Zatik a big financial benefit, despite a $15,000 cut in salary after being rehired. By retiring, she could start collecting well over $100,000 a year in retirement payments from the state in addition to her $158,000 superintendent’s pay. Thanks to a state retirement system that allows retirement at a young age, Zatik can collect both a paycheck and her retirement payments for 12 years before she hits the standard retirement age of 65.
She is a member in an exclusive club of double-dipping superintendents, who retire and return to their same jobs or rotate to other school districts.
An analysis by Ohio’s eight largest newspapers found:
One in four public school leaders in Ohio’s 614 districts bring home the bacon twice.
Allowing superintendents to retire early halts their contributions into the fund and pulls millions of dollars out — while a variety of factors threaten the fund’s long-term financial health.
Superintendents point out that the practice is legal and that they would be fools not to take advantage of a pension system that permits them to retire and return to work. While many superintendents claim the practice is justified because of a shortage of qualified candidates, the Ohio Department of Education says thousands of licensed individuals meet state standards to run school districts.
Double-dipping superintendents are part of a larger state issue. About 32,000 double-dipping state and local employees collected more than $1 billion in pension payouts last year on top of their paychecks. Three-fourths of those dollars went to State Teachers Retirement System members.
Earnings can rise by up to 80 percent
More than 150 of the state’s 613 superintendents collect paychecks and pensions at the same time. Over the past decade, a growing number of school chiefs have cut deals to retire, collect public pensions and return to work, often in the same jobs. In a single weekend, these superintendents increase their earnings by as much as 80 percent.
In many communities, school board members have told residents that hiring a retiring superintendent saves money. In the Gahanna-Jefferson Local School District just northeast of Columbus, the school board touted the savings in rehiring Superintendent Gregg E. Morris because his health insurance would be picked up by STRS.
In 2009, STRS acknowledged paying health care for double-dippers was too expensive and ended the practice, so Gahanna once again began paying for Morris’ health care. Morris left Gahanna this year to become superintendent at Clark-Shawnee. He replaces Debbie Finkes, who was paid $95,188 a year. Morris signed a three-year contract paying him $110,000 annually.
Luci Gernot, Wood County Educational Service Center superintendent south of Toledo, retired after 28 years in 2007 from another school district. That provided her with about $56,000 a year in pension benefits. She is paid $115,000 in her new job. Gernot said she could have gotten another job in any number of industries but decided to stay in education. Either way, she said, she’s entitled to the pension benefit.
“It’s something I’ve earned,” she said.
The deals between superintendents and their school boards have left some residents feeling betrayed. In Cuyahoga County, William Zelei retired in 2005 as superintendent at South Euclid-Lyndhurst at age 56 with 23 years in public service. He was making about $140,000 annually and came back to work in the same job with an agreement to be paid $30,000 less a year.
After a levy passed in November 2008, the board agreed to extend Zelei’s contract in February 2009, but residents believed he would receive no pay raise. After teacher contracts were settled with minimal raises, the board voted 3-2 that August to raise Zelei’s salary 24 percent, or about $32,000.
Residents packed a board meeting to protest the move that would pay Zelei $164,077 by the 2011-12 school year. Suddenly, he was the second-highest paid superintendent in the area and in his fourth year of collecting a pension at age 60.
Ohio spends more for administration
Putting a price tag on the impact of double-dipping superintendents is difficult, but Ohio was criticized earlier this year for spending more money than other states on administration and less than other states on classroom instruction. Such were the findings of a Brookings/Greater Ohio Policy Study Center report released in February.
The study ranked Ohio 47th among states for putting money into classrooms but ninth in tax dollars spent on administration. Brookings also reported that Ohio’s share of spending on administration was 49 percent higher than the national average.
STRS has more working retirees than each of the other state pension systems, paying $741 million in 2009 to 15,857 retirees with an average benefit of $46,800.
Before a change in state law in 2000, teachers had to wait 18 months to return to public service. The forfeiture period was reduced to two months, in line with other public employees. Since then, STRS has seen an enormous growth in the number of double dippers, as teachers returned to full- and part-time work in the schools or as adjunct professors at universities.
In 2009, approximately 1,100 of the STRS members received on average $67,000 in pension pay while returning to work and earning $70,000 to $100,000 in their post-retirement jobs at school districts. An even more exclusive group of 299 STRS retirees collects more than six figures in annual pay while receiving a pension check of more than $80,000 on average.
For this story, Ohio newspapers reviewed the records of many double-dipping superintendents and found that most make more in salary than they did prior to retiring. They also sign contracts with perks that make them consistently among the highest-paid public servants in the state.
For example, many districts not only give the superintendents pay raises, but they also pay both the employee and employer contributions into the retirees’ annuities with STRS. This, in effect, is a 10 percent pay increase on top of the base salary.
Districts also often pay 1.45 percent of salary to Medicare as well as a car allowance, training and travel money, overtime for working holidays and any days not stipulated in the contract, and insurance.
Pool of qualified applicants limited, superintendents say
Why do they get these generous offers?
Forest Yocum retired in 2002 at age 56 from Pickerington City School District before being hired as superintendent at Southwest Licking east of Columbus at $132,000.
“The problem facing a school board is the number of people available,” Yocum said. “There are not that many top-quality candidates.”
Yocum and other superintendents said that the pool of qualified applicants is limited. But the Ohio newspaper analysis found that thousands of licensed Ohioans are available for superintendent jobs. Potential out-of-state candidates and others currently working in education could be groomed, too.
Scott Blake, an Ohio Department of Education spokesman, said 3,305 Ohioans have credentials to be superintendents. An additional 1,204 are inactive.
Ten years ago, Mark Freeman retired as superintendent at Shaker Heights near Cleveland, one of the most prestigious and envied public school districts in the state, one that might draw the interest of talented superintendents. Freeman was earning $149,675 annually when he retired with a pension that was nearly 88 percent of his income.
Shaker Heights rehired Freeman without publicizing the opening or interviewing any other candidate.
He received a raise his first day back on the job, making his pay $156,546.
Deals like Freeman’s led lawmakers in 2003 to require candidate searches before districts rehire recently retired superintendents. Now, a district must post the job opening for 60 days, hold a public hearing to learn whether the community opposes rehiring a retiree and then vote publicly to rehire.
The new rules have not stopped a small cadre of superintendents from continuing to monopolize the positions.
Jennifer Sinisgalli, Strongsville school board president, said her district received applications from 25 or more people when the superintendent’s job was open in 2009. The district permanently hired Jeffery Lampert, who had taken the interim job mid-school year, in December 2008.
Lampert retired eight years earlier from North Royalton and already was collecting a pension. He worked as an adjunct professor at Baldwin-Wallace College before returning as a superintendent to Brooklyn City schools in 2005.
Sinisgalli said Strongsville did a full job search with applicants from Georgia, Florida and other states, interviewed five or six candidates and ultimately decided to continue with Lampert. She said complaints about a weak applicant pool were unfounded.
“I was quite surprised because I heard the same thing, that districts would have trouble finding qualified candidates. We had heard it, but we were thrilled with the response we had,” Sinisgalli said.
Some districts appear to have different standards for teachers, administrators or superintendents.
In 2009, for example, Massillon City Schools in Stark County adopted a policy that basically told administrators — not including the double-dipping superintendent — that they could return after retiring, but at 75 percent of their base salaries.
In the Milford School District in Clermont County, Robert Farrell made $110,000 this year after retiring in 2007 when he was 53 years old. Farrell also receives a $6,000 annual car allowance and a $20,000 annuity paid by the districts. But teachers do not fare as well. They are hired year to year, cannot re-establish tenure and must accept the equivalent salary of a fifth-year teacher, according to the double-dipping school treasurer, Randy Seymour.
The Ohio newspaper analysis found numerous examples of double-dipping superintendents presiding over contracts that provide teachers with fewer benefits than the superintendents get.
State legislators have taken aim at double-dipping several times in the past 10 years.
A bill introduced in 2007 by former State Rep. Michelle Schneider, Republican of Madeira, would have effectively banned the practice, requiring a six-month waiting period before rehiring someone after retirement.
Legislators, pension plans are looking for reforms
State Rep. Bruce Goodwin, Republican of Defiance, introduced legislation the same year to require double dippers to take 40 percent pay cuts before returning to work. The proposal was aimed at school superintendents and top governmental administrators.
Story Compliments Of The Plain Dealer