MINNEAPOLIS TEACHERS PENSION E.D. GETS "GOLDEN PARACHUTE" FOR DOING BAD JOB

The executive director of the Minneapolis Teachers Retirement Fun Association received a "golden parachute" for running a pension fund that has $1 billion in unfunded pension obligations.

"The dispute over the compensation package surfaced as a House panel approved merging the Minneapolis Teachers Retirement Fund Association with the larger state Teachers Retirement Association. Under the deal, the state fund would absorb nearly $1 billion in unfunded pension obligations to Minneapolis teachers.

With plans for the merger progressing, the Minneapolis teachers pension board in March extended the contract of its executive director, Karen Kilberg, a year beyond the date when the fund would cease to exist under the merger. It also granted her a six-month severance. The entire package is worth $215,000." Source: Star Tribune, April 12, 2006

Kilberg is going to collect a paycheck until July 1, 2007, from an organization that will probably no longer exist in a month.

Did Kilberg deserve this special treatment? Hell no!

"But during 10 years when Kilberg directed the fund, it earned less from investments than most large government pension funds in Minnesota, according to calculations by the commission. The Minneapolis fund earned $218 million less from 1994 to 2004 than it would have earned had it performed as well as the State Board of Investment, which handles money for the Teachers Retirement Association.

The fund also paid out extra benefits to retirees without regard to whether it could cover the long-term costs, swelling future pension obligations. Combined with an annual 2 percent boost, the bull market led to yearly increases for retired Minneapolis teachers of 6.2 percent to 9.7 percent between 1997 and 2001." Source: Star Tribune, April 12, 2006

Tags: Rebecca Otto, Pat Anderson