Career Calling

August 7, 2013

The “Problem” of Teachers’ Pensions

I’m on a mailing list from the Chicago Teachers Union, which is a great source of information not heard in the corporate media.  Today, I received the following analysis by Kenzo Shibata, the union’s New Media Coordinator:

“Why do Mayor Rahm Emanuel, the Chicago Board of Education and Chicago Public Schools officials blame Springfield for the district’s budget woes? Why is the target of their concern being shifted to state legislators? It polls well but makes little sense. Let’s examine why.

FACT: The Illinois General Assembly has provided Chicago Public Schools with every opportunity to make their budget work by giving the district a 13-year break from paying pensions. FACT: The district has failed to lobby for a more equitable funding formula, search for new revenue streams or reform programs like TIF that could work better for school districts and redevelopment.

FACT: The city and the Chicago Board of Education’s answers to the revenue crisis have been to cut, and this year, the cuts will have a devastating impact on classrooms across the city.

FACT: Pensions are NOT the problem.

The problem is a pronounced lack of leadership from the mayor and his handpicked Board of Education.

The state legislature, beginning in 1995, provided CPS with the tools to plug its budget issues and time find new revenue streams and reform the TIF program. The timeline looks like this:

1995—The Illinois State Legislature gave then-Mayor Richard M. Daley the ability to use the once restricted pension levy for operating costs to ensure balanced district budgets. The school district enjoyed a 10-year “holiday” from making any payments into the pension fund. The fund prior to 1995 was funded above 100 percent. It wasn’t until 2005 when the fund dipped slightly below 90 percent that the district resumed payment.

2010—The Illinois State Legislature gave Chicago Public Schools a pension holiday that provided the district with more pension relief so the classrooms in Chicago would not feel any negative financial impact. CPS also was granted additional federal funding from a stimulus appropriation; the district still laid-off more than 1,300 teachers despite pension relief from the state and an infusion of money from the federal government.

2012—The Illinois State Legislature gave CPS an extension on the deadline to publicly announce which schools were slated for closure. CPS stated that schools needed to be closed because of a looming budget crisis and that closing schools would help stymie the deficit.

2013—The Illinois State Legislature did not move on the moratorium on school closings proposed by Chicago legislators, citing that the state wanted to provide newly minted CPS CEO Barbara Byrd-Bennett with the opportunity to govern the district. In short, the consensus was that the state legislature did NOT want to micromanage the school district.”

Shibata’s analysis leads us to ask again:  Did teachers cause this problem?  No.  Why are they being asked to pay for it, to suffer during their retirement?  We need to remember that Detroit is the blueprint.  Chicago looks like it could be the next stop on the bankers-rip-off-workers express.  We need to stop this train – now.

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