The Chicago Teachers Pension Fund is seeking a change in state law that would expand the number of charter school teachers who are required to participate, and also allow the fund to levy steep fines on charter schools that are late in handing over teachers’ payments toward pension savings.

Charter school teachers belong to the same pension system as teachers at neighborhood schools, but each charter school determines whether teachers’ pension contributions are taken from their pay or covered by the charter.

Andrew Broy, president of the Illinois Network of Charter Schools, doesn’t think the fines will cause problems for charter schools because they should be paying on time anyway.

But expanding the number of teachers required to participate in the pension system could be controversial, he says, because charter schools don’t want more restrictions on how teachers are compensated.

 “There are uncertified teachers in charter schools who aren’t part of the pension system and that’s okay,” Broy says.  “We don’t see that as something wrong. Our focus should be on whether the teachers are effective. We already have a huge funding challenge with charter teachers who wind up not receiving the same salary as traditional teachers do, and this has the potential to exacerbate that problem” –because a portion of those teachers’ salaries would now go toward pensions.

Fines, late fees

Under the proposed change in state law, the fund wants to be able to charge charter schools 8 percent interest on back payments plus a fine of $100 per day for late payments, up to 20 percent of the amount a school owes.

However, the money typically owed by chronically late charter schools – which during an end-of- November pension fund audit was $360,000, according to the pension fund – is just a drop in the bucket compared to the millions of state and CPS dollars the pension funds have missed out on due to recent “pension holidays” and cuts in state contributions.

The proposed bill would also amend the law to require all charter schools to put someone in charge of tracking pension fund payments, and broaden the fund to include all hourly and salaried charter school staff unless the charter school establishes they are not working as teachers or administrators. Currently, the pension fund only includes certified teachers who are working in salaried positions, but some charter schools pay teachers hourly or hire teachers who aren’t certified.

The pension fund has not yet found legislators to sponsor the bill.

A third of charters “chronically late”

A spot-check of charter contributions last fall showed that a third of charter schools were “chronically late” reporting and making payments, according to fund officials. That includes four schools that submitted nearly $31,000 in payments that the fund said it could not credit to anyone because the schools haven’t sent in teacher payroll information.

Charter schools included in the audit say that in many cases, logistical problems caused the delays–staff were out of the office or switched jobs, employees were learning a new payroll system, or the fund’s website had technical problems.  Some were not aware the fund considered their payments late and said no one had tried to address the issue with them.

“We make payments regularly, generally every 2 to 4 pay periods. We have never been told that a problem exists,” notes Kelly Dickens of Urban Prep. “We are current on all payments. As far as we know, there has been no problem.”

But because the school had not paid in three pay periods at the time of the audit, it was listed in CTPF’s analysis as owing a total of $46,500 among three campuses. Kevin Huber, executive director of the pension fund, says all payments must be received by the 10th day after the end of a school’s pay period.

Youth Connections Charter School Comptroller Hope Mueller says at least two of the three affected campuses, which were listed as owing over $48,000, made all their payments for November on time.

Mueller says that Youth Connections, too, has been allowed by CTPF to file its payroll monthly, rather than after every pay period. 

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