CTU president concedes possibility of CPS ending annual multimillion-dollar practice of teacher ‘pension pickups’

CTU President Karen Lewis has acknowledged that CPS is in dire straits – and that her union may have to make concessions in contract negotiations, including ending the practice of the school district – meaning taxpayers – picking up the majority of teacher contributions toward pensions, which has cost $1.3 billion since 2006.

Karen Lewis, president of the Chicago Teachers Union, or CTU, has finally acknowledged something she’s avoided for a whole year of teacher contract negotiations with Chicago Public Schools, or CPS: Chicago teachers should contribute their full share toward pensions.

Public school teachers in Chicago are legally required to pay 9 percent of their salaries toward their own pensions. But since 1981, as a result of contract negotiations between CPS and CTU, Chicago teachers only pay 2 percent of their salaries toward their pensions. City taxpayers have to cover the remainder of the employee contribution. Since 2006, this practice has cost taxpayers $1.3 billion.

The 1981 agreement was part of a trend in the 1980s and 1990s, which saw many government entities, including most Illinois school districts, begin “picking up,” or paying, their employees’ pension share as an added employee benefit. In Illinois, nearly two-thirds of all school districts pay some or all of teachers’ required pension contributions. Of course, when any government entity agrees to cover part of an employee’s pension contribution, it must take that money from taxpayers.

Pension pickups at CPS – including those for teachers – are a perk that costs Chicago taxpayers nearly $170 million yearly and has contributed to CPS’ demise. Asking teachers to pay their full share means those tax funds could then go toward CPS’ employer pension contributions, which the district has underfunded for years.

Forrest Claypool, the CEO of CPS, has called for an end to pension pickups as part of a plan to address CPS’ gaping budget deficit.

Claypool has already rolled back pension pickups for his nonunion central-office employees. Ending pickups for those employees would save over $10 million a year by 2018.

The bigger savings, however, will only begin when the district phases out pickups for CTU members entirely.

Getting the teachers union to agree to end the pickups hasn’t been easy. Lewis originally warned that requiring Chicago teachers to contribute more of their own money toward their retirements is “strike-worthy.”

The rhetoric has recently changed. After a speech on Jan. 21, Lewis said, “I think that people understand the dire straits that CPS is in and that we are willing to make certain sacrifices.”

She should know. The last strike Lewis led did nothing to help CPS’ finances, its teachers, or the more than 350,000 Chicago children who attend public school.

Instead, it left CPS with a bigger hole in its operating budget, ending in more than 4,000 pink slips for its employees and in school closures, along with an even bigger pension-funding gap and a junk rating for CPS bonds.

Lewis is right to finally come around on ending teacher-pension pickups. It’s not out of line to ask her members to pay their share of the costs associated with their own retirement benefits.

It’s one of the steps necessary to help CPS avoid bankruptcy.