Sunlight tips its hat to the Star-Ledger editorial board. As Sunlight’s readers probably know, Sunlight came out with a report last week after we discovered that NJEA Executive Director Ed Richardson was paid $2.5 million in 2019. This jaw-dropping revelation elicited exactly zero coverage in the New Jersey media. Zero.
Until today, when the plugged-in and courageous Star-Ledger continued to lead the way for journalism in the state and keep its citizens informed. The editorial board has never shied from calling out New Jersey’s most powerful special interest, the NJEA, and they did not this time. Here is the Star-Ledger‘s excellent, hard-hitting editorial:
Money still piling up for NJEA brass | Editorial
You probably pay it without a quibble, knowing that you’ll be vested in a pension system after 10 years, and that the payoff could be pretty sweet if you climb a few tiers beyond the normal retirement age of 60. Besides, you’re not in this for money.
But you’d be justified if you asked exactly how those union fees are spent, because the top executives at the New Jersey Education Association – an unrivaled financial and political juggernaut in this state – can no longer deny that they’re in it for the payday.
We were given another glimpse behind the curtain last week, when Sunlight Policy Center of New Jersey tracked down the NJEA’s IRS filing from 2019 and found salaries that would make Rutgers coaches blush, starting with $2.5 million in compensation for Ed Richardson, the executive director who has since retired.
In fact, on its list of “highly compensated employees,” there was plenty of cash on hand to compensate the NJEA’s dream team: Sunlight points out that the top 10 highest-paid leaders in the union made a total of $7.7 million that year.
And all of it is bankrolled by New Jersey’s rank-and-file teachers, who usually sign up as members on their first day at the job without knowing how those dues – by far the highest in the nation — are invested.
The union assails Sunlight’s interpretation of the IRS figures, noting that it’s more accurate to differentiate the standard salary in one column from the “estimate amount of other compensation” in another. In Richardson’s case, he has a reported compensation of $338,000, but the $2,147,335 in ‘estimated compensation” is an “actuarial projection of a pension amount that may be paid to that employee,” according to NJEA communications director Steve Baker, who claims that the latter amount is “not guaranteed as payment later.”
An amused Sunlight author Mike Lilley says that projected pension amount is as guaranteed as money in the bank: The NJEA Employees’ Retirement and Trust Fund Plan (separate from the teacher’s plan) is 137% funded.
“The bottom line is that the IRS rightly sees the annual increases in the value of Richardson’s pension as part of his annual compensation, and it rightly accounts for those in the tax year they accrued,” Lilley said. “It does not matter if the compensation is paid out in the future. It was earned during the year it accrued.”
Indeed, the robust health of the union pension plan is the result of the annual avalanche of dues from New Jersey teachers. The fees they pay to the NJEA are the highest of any state in the nation: The $979 annual fee is 21% higher than No. 2 Alaska ($765) and more than double paid by teachers in New York State ($378).
On top of that, teachers pay the standard $200 dues to the National Education Association (whose own top executives cannot match Richardson’s salary) and kick another $100-plus to the local union.
Moreover, teacher salaries, negotiated on a local level, have been mostly stagnant for the last three years; and their own pension plan — the Teachers’ Pension and Annuity Fund (TPAF) – remains severely underfunded at 35%, Lilley points out.
And not only is the union’s own pension fund massively overstuffed, its members get an annual 2.5% cost-of-living-adjustment built in. The teachers had their COLA eliminated in 2011.
We venerate unions in this state, and that’s only right, since they built the middle class in this country.
Each year in its IRS 990 Form, the NJEA asserts that its mission is to “assist all members in the economic, professional, and social advancement of their condition,” and maybe it does some of that. But its 200,000 members are excused if they wonder whether their union has different priorities.