37 Comments - From the 'Dale to HP - Monday, Mar 27, 17 @ 10:38 am: ===Part of this lawsuit basically boils down to whether the state should count teacher pension funding as education funding.=== Suggestion for CPS: you’ve made this a pension issue and you’re going to probably lose if this is a pension issue. Make it an education issue, and you might have a shot. But you didn’t. So good luck… - Carhartt Representative - Monday, Mar 27, 17 @ 10:43 am: The problem is that if CPS made this an education issue, they could probably be sued by CTU or parents on the same grounds. They provide a separate but unequal system within their own district. That’s why the selective enrollment schools are on the North Side. - TinyDancer(FKASue) - Monday, Mar 27, 17 @ 10:48 am: Why is Chicago, the state’s economic engine, required to pay both the CPS pension cost and TRS pension cost? No other municipality in the state has that burden. Chicago’s school population is 86% low income. It’s a well-known fact that low income at-risk students need extra support in order to succeed. Anything that diminishes that support is discriminatory. How is this not a violation of the equal protection clause of the 14th amendment? - Phenomynous - Monday, Mar 27, 17 @ 11:09 am: Is Chicago willing to allow the Governor to make the majority of appointments and the Chair appointment to the Chicago Teachers Pension Fund? That’s how it is with TRS. - Arthur Andersen - Monday, Mar 27, 17 @ 11:11 am: Tiny, why does the rest of the state have to pay CPS’ block grant that no other district received? How does it line up with all the Fed laws that CTPF did a left pocket/right pocket “transfer” of $1 Billion from the State intended for pensions and spent it on retiree health care subsidies (until big bad Rauner bricked it)? IMHO, CPS/CTPF should not get a nickel until they explain what happened to the missing Billion, that if properly invested would possibly obviate the need for the new $215 million bailout. - m - Monday, Mar 27, 17 @ 11:20 am: =Why is Chicago, the state’s economic engine, required to pay both the CPS pension cost and TRS pension cost?= And to add to what Arthur Andersen mentioned about the block grant, which more than makes up for pension costs… Why is Chicago allowed to use a property tax system that undervalues their property compared to the entire rest of the state in order to get more state aid? Why is it that Chicago gets to blame the state for their own mismanagement when the entire state funding scheme benefits them more than any other district? - TinyDancer(FKASue) - Monday, Mar 27, 17 @ 11:23 am: @Arthur So, you think all Illinois teachers EXCEPT CPS should get a health care subsidy? - Lucky Pierre - Monday, Mar 27, 17 @ 11:27 am: that Illinois makes teacher pension payments on behalf of primarily white students and then denies those same resources to Chicago’s students of color – and that’s the heart of the State’s racial discrimination.” CPS has just called the Chicago Democrats who set up the current school funding racists - Rod - Monday, Mar 27, 17 @ 11:28 am: I am impressed at the honesty of Thomas Ioppolo of the AG’s office. To tiny dancer, CPS has had a separate pension fund since the turn of the century and in fact the Chicago Teachers Pension Fund has opposed a merger with TRS. Why? Because TRS faces the real risk of future insolvency because of an unfunded liability created by 75 years of insufficient state contributions. TRS will be able to meet its benefit obligations to retired teachers in the near future, but it cannot guarantee retirement security for future generations of teachers unless the state’s future annual contributions meet an actuarial standard for full funding. The FY 2016 state contribution fell $2.08 billion short of the amount of money that would be required to fully fund pension benefits in FY 2017 under standard actuarial calculations. TRS’ board of trustees voted to seek a state contribution in fiscal 2018 of $4.56 billion—up a whopping $561 million, or 14.5 percent, over this year’s $3.99 billion. TRS blamed part of the hike on its recent decision to lower its assumed rate of return on investments from 7.5 percent to 7 percent. Doing so forces the state to put up more money to make up the shortfall. For the year ended June 30, 2016, the Chicago fund actuarial analysis determined that the asset return on a market value basis was -0.3%. After gradual recognition of investment gains and losses under the actuarial smoothing method, the actuarial rate of return was 8.6%. This represents an experience gain when compared to the assumed rate of 7.75%. If you were a CPS employee would you want to be part of the TRS or CTPF? - Legal Eagle - Monday, Mar 27, 17 @ 11:29 am: =the entire state funding scheme benefits (CPS) more than any other.= It doesn’t. The State now admits in a legal filing that CPS’s numbers are correct. In totality, including block grants and pension subsidies and everything else, CPS gets a lot less. It’s just a legal question now. Not a factual one - Oswego Willy - Monday, Mar 27, 17 @ 11:30 am: That Rauner Veto, purposely hurting Chicago students due to an emotional “thing” Rauner himself describes… … continues to haunt Rauner. That $215 million was a choice by Rauner to hurt Chicago students. That’s real. It’s emotionally real. Now this continues because of Rauner’s emotions. - City Zen - Monday, Mar 27, 17 @ 12:00 pm: ==Chicago’s school population is 86% low income.== So what exactly is Chicago doing to attract/retain middle and upper-middle class families? A middle class family requires a decent size house on a decent size lot is a decent neighborhood. Got a $300,000 house in North Center or Wicker Park that fits those requirements? This is why all these folks flee to the suburbs once junior is school age. It amazes me that CPS complains that all the majority of their kids are below poverty level but Chicago makes it very difficult for anyone above to raise a family there. Is it any wonder the school population is that skewed? - TinyDancer(FKASue) - Monday, Mar 27, 17 @ 12:09 pm: =Chicago Teachers Pension Fund has opposed a merger with TRS.= I wasn’t advocating for a merger. My point is: Society as a whole benefits from an educated citizenry. Children require resources in order to be educated. Poverty inflicts multiple childhood educational/developmental disadvantages. Therefore, impoverished students require more resources. It is the state’s responsibility to fund education/provide necessary resources. To not provide those resources is discriminatory. - Rod - Monday, Mar 27, 17 @ 12:35 pm: City Zen: the number of private school seats are increasing in higher income areas of the City. Many families with two six figure incomes are just not bothering with CPS any more. That is the situation in Andersonville where I have lived for over 30 years now. CPS and I suspect Mayor Emanuel believe these families will do just fine. Both CEO Claypool’s children and the Mayor’s children went to private schools as a case in point. TinyDancer you originally posed the question as to why the City had a separate teacher’s pension fund paid for largely by Chicago property tax payers. The separate pension fund was set up when CPS was a majority white school district so it will be hard to argue the intent is racist, but the court will decide that shortly. The $215 million is in reality only about 4% of the CPS FY 17 budget, the reason there is a crisis is because CPS played high stakes poker with Rauner at the start of the school year and booked the $215 as revenue in its FY 17 budget before it was legally appropriated by the State. The Civic Federation of Chicago at the time publicly stated at the time it was a bad move because there was a real possibility the revenue would not be realized and they were right unfortunately for CPS. - Anonymous - Monday, Mar 27, 17 @ 12:38 pm: @Tiny Dancer- nom CPS teacher pre-pay for retirement insurance. We pay to reduce the cost for for retired teacher through the THIS deduction and prepay a portion of the premium through TRIP so that insurance is less expensive after we retire. We are paying our own “subsidy” and one for those that are currently retired. - Oswego Willy - Monday, Mar 27, 17 @ 12:44 pm: ===the reason there is a crisis is because CPS played high stakes poker with Rauner at the start of the school year and booked the $215 as revenue in its FY 17 budget before it was legally appropriated by the State.=== That’s not true to the politics. Rauner purposely vetoed the $215 million before any timeline that the parties thought were even in play. Bruce Rauner, himself, called this an “emotional” decision and veto, having really… nothing… to do with what you are trying to pass off as a thought to the politics. Otherwise, Rauner trying so hard, himself, to make right his veto, your idea makes zero sense to the political. It sounded good, lots of words, but Rauner answered the question, all by himself. - City Zen - Monday, Mar 27, 17 @ 12:48 pm: @Rod - Tell that to Luther North and Queen of Peace, two private schools closing in the city. My point is…my family is the type that would move the numbers to a more traditional middle class student population if only Chicago would provide the housing we require. What you’re saying is Chicago does great in attracting a few wealthy parents that can afford private school or low income families with nowhere to go. CPS’s “86% low income” student population is of their own doing. They scared everyone in the middle away. - m - Monday, Mar 27, 17 @ 12:59 pm: =The State now admits in a legal filing that CPS’s numbers are correct.= That’s reaching a bit, from you and CPS. CPS gets more $ in special benefits than the normal cost of their pensions. That is a simple fact. CPS’s claims are based on their % of total state pension spending. Why is total state pension spending so high? Because of the money that was shorted to TRS for years. That’s not money owed to CPS, because it wasn’t shorted by the state. CPS got their special deals even when payments to TRS were skipped and shorted. It’s like Mastercard asking for part of your late fees to Visa, despite the fact that you paid Mastercard on time. So yes, the numbers CPS is basing this on are correct, but not how they add it up, nor what they say they are owed. - TinyDancer(FKASue) - Monday, Mar 27, 17 @ 1:01 pm: @ Rod I am not questioning why the city has a separate fund. I know why. I’m saying there should be equitable funding. - JS Mill - Monday, Mar 27, 17 @ 1:18 pm: =I’m saying there should be equitable funding.= CPS benefits from the current funding strategy. If they went through the “normal” process that every single other district in the state goes through, they would receive much less money. That includes pension money. =It doesn’t. The State now admits in a legal filing that CPS’s numbers are correct. In totality, including block grants and pension subsidies and everything else, CPS gets a lot less. It’s just a legal question now. Not a factual one = I would love to see the “admission” by “the state” that you reference. I have looked at the CPS funding (from the state) as well as the legislation that defines their funding. You are incorrect, and the math isn’t even close. - m - Monday, Mar 27, 17 @ 1:39 pm: =CPS benefits from the current funding strategy. If they went through the “normal” process that every single other district in the state goes through, they would receive much less money.= Yes and yes. And none of this addresses the way Chicago scams the tax system with lower rates on lower valuations, giving them more aid yet. But it all gets out there in the weeds in court, easier to just try to get pensions out of the funding argument. The tax stuff especially is hard to quantify and compare considering the variances between taxing districts in the state. - Rod - Monday, Mar 27, 17 @ 1:49 pm: Willy whether its true to the politics or not is irrelevant from a fiduciary perspective. CPS booked money it had no on going appropriation to expect with reasonable variation such as student enrollment. CPS and the City of Chicago have argued for pension parity now for several years and in general the Republicans have not agreed with that argument. In fact the Senate Republicans even wrote a white paper opposing that perspective at one point (http://www.chicagobusiness.com/article/20130313/BLOGS02/130319907/chicago-public-schools-get-too-much-illinois-senate-gop ). The grand bargain failed, trading CPS pension relief for pension reform has failed. So CPS has to deal with its fiscal situation as likely will property tax payers like myself. CPS by the school code is legally immune from any fiscal over sight by ISBE in terms of its budgeting practices. The AG’s office I think has shown that in an excellent legal memorandum when Governor Rauner attempted to declare CPS insolvent and impose an oversight panel. No other school district in Illinois would play such a high stakes game, CPS has been doing this for years with the State. It tried to do this with the banks and failed back in 1979 when the Chicago School Finance Authority was forced on CPS. Possibly CPS will have to go into full default mode again before its finances are brought under control again. Its a very sad situation. City Zen: the school closings you have noted are really private schools for families that do not have the money I am talking about and they are not secular schools like the British School, the Waldorf School, etc, see this article from 2013 http://www.chicagobusiness.com/article/20130928/ISSUE01/309289971/private-schools-are-popping-up-around-town . I don’t dispute private schools with a religious basis are in trouble in Chicago. - Oswego Willy - Monday, Mar 27, 17 @ 2:01 pm: ===Willy whether its true to the politics or not is irrelevant from a fiduciary perspective.=== Nope. Good try thou. The politics dictated Rauner’s veto put stress where there was no need to be stress. You type lots of words. Rauner used one “emotional” That’s how this $215 million “missing” came to be. Rauner’s own actions to try to get it back says its so, lol. - Oswego Willy - Monday, Mar 27, 17 @ 2:02 pm: - Rod - White paper, construction paper, tissue paper. Rauner owns his veto. Thems the breaks. - m - Monday, Mar 27, 17 @ 2:07 pm: =Rauner owns his veto. Thems the breaks.= Aside from the “because Rauner,” and regardless of whether he owns the veto, banking the money from the state was a bad move by CPS. - Rod - Monday, Mar 27, 17 @ 2:17 pm: Clearly Willy as a non-Chicagoan your primary concern here is with the defeat of Governor Rauner. I can appreciate that. As a Chicagoan I am far more concerned with CPS getting its ship in order to provide an education for children for years to come within the context of the demographic decline of Chicago. CPS cannot continue to lean on the state for bailouts for ever, eventually the chickens are coming home to roost. CPS is in very deep fiscal trouble and the pensions play a good part in all of this, but they are not the totality of the problem. - Oswego Willy - Monday, Mar 27, 17 @ 2:32 pm: ===Clearly Willy as a non-Chicagoan…=== Yeah, I’m going to stop a whole paragraph of patronizing right there. Ignoring the veto and the purposeful hurting of Chicago students was done emotionally. Rauner said so. What should worry you, “as a Chicagoan” (rolls eyes) is that Rauner base a deal, in conjunction with pensions and the $215 million and now “everything” was blown up do to a veto. Typing more words, trying to exuse the action only a governor can do to hurt Chicago schools, that’s not trying to solve anything. If “anything” it’s disingenuous to what that $215 million means today, and the deal Rauner couldn’t wait on too. ===CPS cannot continue to lean on the state for bailouts for ever, eventually the chickens are coming home to roost=== Hows about we focus on the $215 million, the “emotional” veto, the trying by Rauner to not be blamed by the veto, and what that veto did with Cullerton working on his bill. Stay focused. - Oswego Willy - Monday, Mar 27, 17 @ 2:33 pm: “… Rauner blew up a deal… “ - Anon - Monday, Mar 27, 17 @ 2:43 pm: ===Part of this lawsuit basically boils down to whether the state should count teacher pension funding as education funding.=== Has anyone made a serious argument that teacher pension payments aren’t part of education funding? - Legal Eagle - Monday, Mar 27, 17 @ 3:03 pm: =I would love to see the admission by the state that you reference.= Read the state’s reply, filed Friday. Their only substantive argument is that pension payments are not education funding. It was their only response in challenging CPS’s math. - Oswego Willy - Monday, Mar 27, 17 @ 3:05 pm: Rauner apologists… Trying to detach the veto as inconsequential to everything at play. Chance said it best “Do your job” to Governor Rauner Like y’all, thinking more words and “well, this.. and that… and this… ” … Chance sees $215 million vetoed, emotionally, and holding that money up again. That’s real. You may not like it, but Rauner owns today, and today is the veto. - Chambananon - Monday, Mar 27, 17 @ 3:36 pm: Willy, With respect — for a person that spends as much time spouting his opinion on this blog and demanding that others engage in arguments based on actual facts as you do, you sure seem to spend a lot of your posts merely repeating the same points over and over again. News flash: just because you keep saying something doesn’t a) make it true, b) invalidate the other poster’s argument (especially where, as here with your ‘discussion’ with Rod, you simply ignore the argument in order to repeat yourself), or c) encourage an actual discussion of the issues. TL;DR: there’s a reason people pay more attention to RNUG and wordslinger’s posts than yours — regardless of whether they are right, they aren’t immediately dismissive to other commenters and they allow other opinions into the mix rather than creating a false ‘consensus’ based merely on their posting more than the next five commenters combined. You have a ton of great points (e.g. Governors own), but the seemingly condescending demeanor does nobody any good here. Again, with respect. - Oswego Willy - Monday, Mar 27, 17 @ 4:48 pm: - Chambananon - Since you spent your entire comment chiding me, you forgot to include what was false. All that typing, and yet… where was the false narrative. You can always choose to skip my comments… - blue dog dem - Monday, Mar 27, 17 @ 6:52 pm: Chamb. I might disagree on the Word being considerate statement. Most of the time. - Lucky Pierre - Monday, Mar 27, 17 @ 10:29 pm: I would love to skip your comments because they are frequently like listening to a broken record but it is very difficult to play whack a mole with your I know you are but what am I banter - Oswego Willy - Tuesday, Mar 28, 17 @ 6:11 am: - Lucky Pierre - I wouldn’t have to remind you things over and over if you were the least bit honest in your comments in what you think you know. You’re not. Thus the continued reminders. - Oswego Willy - Tuesday, Mar 28, 17 @ 6:33 am: - Lucky Pierre - I call your “whack a ‘bot” disappointing to the honest discussions, since you shouldn’t have to be reminded of things you should have learned months ago as disingenuous. So, there’s that I guess… Sorry, comments for this post are now closed.