Chicago’s political leadership is floating a pension buyout program as evidence it is seriously addressing the city’s thirty-six-billion-dollar unfunded pension liability, but Mark Glennon, founder of the Illinois policy research organization Wirepoints, said that the proposal moves debt from one column to another rather than reducing it, and that the broader fiscal picture facing the city continues to deteriorate across every measurable dimension. Audio here.
Active employees who put their own money into this pension fund must realize that the fund is paying out more than it takes in. It is probable that money put in by actives will be used to pay pensions and retiree health benefits to those who have already retired. If nothing else, the teachers union should insist that new contributions will be set aside for those who pay into the system.
If CPS/CTU agreed to the following terms for a 3-year contract…
– 1% yearly raises
– Rollback pension pick-up over 3 years from 7% to 4% ,2%, 0%
– Keep existing step/ladder pay increases
…teacher take-home pay would essentially remain frozen for 3 years and by the time the next contract rolls around, the pension pickup would be gone. Not a bad compromise, all things considered.
Karen Lewis and the CTU should absolutely give on this and incrimentally pick up thier pension contributions from the current 2% they pay now upwards towards thier full contributional share level. Period.
How quick this takes place is negotiable along with pay and benifits, but CTU teachers need to belly-up-to-the-bar and pay thier contribution.