“Chicago Public Schools’ teachers will need to give up some benefits during upcoming pension system negotiations, or run the risk of ‘thousands and thousands of layoffs,’ Illinois Senate President John Cullerton, D-Chicago, said Monday… ‘Chicago Public Schools have a problem and we need to act now,’ Cullerton said…” (Cullerton to CPS teachers: Give up benefits or risk ‘thousands’ of layoffs).
“[Even though] the financial challenges facing the Chicago Teachers' Pension Fund can be attributed to nearly 20 years of short-sighted decisions involving diverted tax levies and General Assembly-approved skipped or reduced contributions by Chicago Public Schools -- not from benefits now paid to retired teachers or promised to future ones.
“That's one conclusion of a report issued… by the Center for Tax and Budget Accountability, a nonprofit, independent research and advocacy think tank committed to ensuring that tax, spending and economic policies are fair. Founded in 2000, the organization is known for its objective analysis of budget-related issues to improve the fiscal health of the State of Illinois. Its bipartisan board of directors includes a mix of institutional money managers, academics, union representatives and business executives.
“In its August report, ‘Analysis of Proposed FY2014 Chicago Public Schools Budget,’ CTBA noted that CPS made reduced payments or skipped payments to CTPF which resulted in chronic underfunding during the past two decades. The CTBA report concluded that had CPS not diverted the property tax revenue that - prior to 1995 - went directly to CTPF, the pension plan would have been nearly 80 percent funded in fiscal year 2011.
“CTBA said that while the plan was 96 percent funded in 2002, years of neglect by CPS and the General Assembly had left it only about 60 percent funded in 2011. The plan was 53.9 percent funded at the end of its 2012 fiscal year…” (CHICAGO, Sept. 3, 2013 /PRNewswire).