Teachers Union Presidents Extract Lucrative Benefits from Schools – For Themselves

In 1992 Luigi Battaglieri was a teacher in the Fraser Public Schools, earning an annual salary of $34,659. That's when he quit being an educator and went to work for the state's largest teachers union, the Michigan Education Association. Battaglieri rose in the union hierarchy and eventually became its president, collecting a six-figure salary along the way.

But because of a deal made with the school district back when he stopped teaching, Battaglieri now collects an annual government pension of $85,903, which is more than twice his salary as a teacher. He will receive these payments the rest of his life because a deal that was supposed to last just one year — to be a school employee "on leave" — was instead continued for 14 years.

Battaglieri was the first of three MEA presidents to parlay a six-figure union salary and a special arrangement with a school district into a lucrative state pension. The MEA reimbursed Fraser Public Schools for the estimated cost of Battaglieri’s state pension, setting an example that would be followed by the next two presidents. But because of persistent underfunding of the school pension system going back at least 30 years, Michigan taxpayers will still end up paying a share of the three union presidents' lucrative pensions.

If Battaglieri's government pension were based on what he earned as a teacher from 1974 to 1992, he would be collecting an estimated $9,358 a year. But under the special "leave" arrangement with the school district, he was allowed to use his 14 years as an MEA employee and his union president's salary of $181,902 to "spike" his eventual pension payout. Battaglieri retired in 2006.

“Lu Battaglieri is acting consistently with the mission of the MEA, which is to extract as much from the public schools as they can with little regard for students,” said Leon Drolet, chair of the Michigan Taxpayers Alliance. “Lu is doing that for himself by any means necessary."

Battaglieri was the first of three MEA presidents to strike “educator on leave” pension spiking deals with their school districts. Current MEA President Steve Cook spent 15 years as a part-time paraprofessional with the Lansing School District before leaving to work for the union in 1992. Cook is now eligible to use the last 23 years he spent working for the MEA and a $201,613 union president salary as the basis for his pension from the Michigan Public School Employees Retirement System (MPSERS). Cook's estimated annual pension payout will be $105,000 when he retires.

Iris Salters, who was the MEA president before Cook and took over after Battaglieri, struck a deal in 1992 with the Kalamazoo Public Schools. She gets a $140,000 annual state pension, about $100,000 a year higher than what she would have received were her pension based on only the 32 years she worked for the Kalamazoo school system.

The deals brokered by the MEA presidents do not violate the law. Under the Public School Employees Retirement Act of 1979, employees who went on a “professional services leave” before Oct. 1, 1996 were allowed to use their time on the job with a "professional service organization" to earn more “service credits” with the school retirement system. State pension officials report that as many as 14 individuals may be eligible for similar pension spiking arrangements.

John Ellsworth, a Grand Ledge Public Schools teacher who is a member of the MEA, said he thinks it is reasonable for a Michigan school district to save the position of an employee on loan to another entity, public or private, and continue to make retirement contributions on the loaned employee's behalf.

Ellsworth said he’s OK with the deals made by the MEA presidents “so long as the district is being reimbursed by the MEA.”

Performing union work is providing service to public schools, Ellsworth said.

“Working for the union is contributing to and advancing public education,” Ellsworth said in an email. “Clearly being a union leader is not the same as being a classroom teacher, but neither is being a superintendent or human resources director. MPSERS is intended to provide a retirement for people working in public education, and union leaders (very similar to school district leaders) are working in public education. If union leaders are being prohibited from getting more than a classroom teacher's level of benefits from MPSERS, then I believe superintendents and community college presidents should also be prohibited from getting more than a classroom teacher's level of benefits from MPSERS.”

James Perialas, president of the independent Roscommon Teachers Association that left the MEA in 2012, said the culture of the MEA membership is not to question the actions of its top leaders.

“The worst thing, is that the union culture and mentality allows them to pull these kinds of things and NOT think that it is wrong,” Perialas said in an email. “And again, the rank-and-file union members have no idea that this is going on, because to question or talk about it publicly, is considered disloyalty.”

Sen. Phil Pavlov, R-St. Clair, said the three cases of the MEA pension spiking are “three glaring examples” of why MPSERS needs to be closed.

“Moving to a defined-contribution eliminates any of the games and abuses of the system,” Pavlov said. “Those are sweetheart deals that have been made at the cost of all the other retirees in the system.”

Pavlov introduced Senate Bill 102 in February that would close MPSERS to any new hires starting July 1 and instead give new employees 401(k)-type benefit plans.

The MEA has refused to respond to all attempts to comment on the series of stories involving its presidents and pension spiking. Fraser Public Schools Superintendent Dave Richards also didn’t respond to an email seeking comment. The school district did say that most of the records regarding Battaglieri were destroyed because the required record retention period had expired. The district did forward what material it had on Battaglieri to Michigan Capitol Confidential, which included dozens of emails and documents from Battaglieri’s personnel file.