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Is the IRS Grinding an Axe for Teachers' Unions?

4:00 PM, Feb 6, 2012 • By JOY PULLMANN
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Nearly 100,000 public charter school teachers are in danger of losing already earned pension benefits if a proposed IRS rule goes into effect this June. The public comment period on the regulation ends today, with no word from the agency regarding its decision.


The IRS selected a basket of public employee categories (including zoo keepers) to stop designating as government groups, meaning they would lose eligibility for state pensions. This regulation would force states to yank charter school teachers from state retirement plans and retroactively pull matching funds the state has already contributed to their accounts. Every single state that authorizes charter schools currently either requires or permits charter schools to participate in the state’s retirement system.

“We're hoping this is just an oversight,” said Stephanie Grisham, spokeswoman for the National Alliance for Public Charter Schools.

Charter school teachers are largely non-unionized, and happy to stay that way. Teacher unions are the largest special-interest contributors to elections—and huge contributors to President Obama in 2008. They constantly oppose charter schools. Charters are fully public schools (they receive public per-pupil funds, must take all comers, and pick students by lottery if oversubscribed) that receive flexibility on government mandates in exchange for an actual possibility of quick shutdown if they can’t prove they’re educating kids.

Charters consistently show up traditional public schools academically. Four hundred thousand students are on charter school waiting lists, and the main reason they can’t get in is that teacher unions in every state and district have sponsored limits to their growth.

It’s odd for a government agency to try to strip, rather than enlarge, public-sector benefits. So is this just an oversight, or a sneaky backdoor attempt to please unions piqued at Obama’s pro-charter education policy so far?

It’s hard to tell right now, but one thing is clear: This reflects poorly on the IRS and Obama administration. It either indicates the agency has so many regulations it can’t measure their potential impact, or that the administration is so deep into picking winners and losers according to campaign donations it’s willing to strip 95,000 public employees of already-earned benefits.

 Joy Pullmann is managing editor of School Reform News and an education research fellow at The Heartland Institute

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