THE WATCHDOGS: How Chicago Teachers Union spends its money

The Chicago Teachers Union, having rejected a new teachers contract, is in a high-stakes battle with Mayor Rahm Emanuel’s administration.

And with more than $25 million a year in dues coming from 28,000 teachers and other school employees, CTU president Karen Lewis and her 77-member staff are a well-funded adversary for the mayor and his schools chief, Forrest Claypool, a Chicago Sun-Times examination of the union’s financial filings shows.

The teachers union operates four separate tax-exempt corporations: the union itself, a political action committee, a charitable foundation and a not-for-profit company that, until recently, owned and operated an apartment tower at 55 W. Chestnut.

According to its most recent filings with the Internal Revenue Service, the union had $9.8 million in cash on hand at the end of the 2013-14 school year.

Eight CTU employees, including Lewis, were paid more than $100,000 that year.

The union also paid hundreds of thousands of dollars to Robin Potter & Associates, a law firm owned by the mother of Jackson Potter, a Chicago high school teacher turned CTU employee who helped found Lewis’ coalition of supporters — known as CORE, the Caucus of Rank-and-File Educators.

Since Lewis and her team took over the union’s leadership in June 2010, Robin Potter & Associates has been paid more than $1 million to handle discrimination cases and other matters involving teachers.

In 2013-14, the union paid more than $1.2 million to Robin Potter and two other law firms: $361,159 to Robin Potter; $500,201 to Dowd, Bloch & Bennett, for bargaining issues; and 361,958 to Poltrock & Poltrock, for employment law issues, the records show. It spent another $241,536 on in-house lawyers.

Robin Potter hadn’t done paid legal work for the CTU before Lewis and her team took office, says Jesse Sharkey, the union’s vice president.

Sharkey replaced Jackson Potter on CORE’s slate of candidates for union office after Jackson Potter dropped out of the 2010 union election amid a court fight over whether he was eligible.

Sharkey says Jackson Potter’s job as CTU staff coordinator has nothing to do with the payments to Potter’s mother’s law firm.

Sun-Times file

“Her son doesn’t have any influence over who we hire,” Sharkey says of Robin Potter.

Those decisions are made by the union’s board, Sharkey says.

As staff coordinator, Potter says he serves as a sort-of “chief of staff” for union leadership, “making sure our various departments are working in concert and coordinating activities.” He says he plays no role in his mother’s dealings with the union.

The money that the CTU paid to law firms is among several big-ticket expenses the union’s tax-exempt organizations had in 2013-14. Others include:

• $106,665 to the accounting firm of Bansley & Kiener, which prepares the union’s IRS reports. The city of Chicago uses the same firm to audit its tax-increment financing, or TIF, districts, which get millions of dollars in property-tax receipts that the union wants Emanuel to turn over to the school system.

• $1.2 million in rent for the union’s headquarters in the Merchandise Mart.

• $6.5 million in salaries for its 78 employees, about 65 who are full-time. The CTU’s average yearly salary is $83,075.

• $363,442 on “conferences, conventions and meetings.”

The union’s two highest-paid employees were administrator Lynn Cherkasky-Davis, paid a salary of $233,071, and Annette Rizzo, the union’s health and benefits coordinator, paid $205,221.

Lewis had the sixth-highest salary: $145,918. But she also got a separate paycheck from the Illinois Federation of Teachers as that organization’s executive vice president — a job that paid her $67,186 in 2014, bringing her combined pay to more than $211,000.

Sharkey, the CTU’s vice president, made $98,797.

The not-for-profit company that had operated the union’s apartment tower, called the Chicago Teachers Union Tower Corp., sold the building on West Chestnut in October 2014 for $48.5 million.

The union budgeted about half the proceeds of the sale to buy and renovate a building at 1901 W. Carroll, just north of the United Center. The Carroll building is owned by the CTU foundation, which will have its headquarters there and lease space to the CTU and another tenant.

In 2013-14, the union’s foundation made $1 million in donations to community organizations and not-for-profits. Those were made possible by the CTU Tower Corp. transferring $12.7 million from the maintenance fund for the apartment building to the foundation shortly before the building was sold.

The following year, the foundation doubled its donations to community groups, many of which have been supportive of the CTU in its disputes with Emanuel, the Sun-Times has reported.

In addition to their union dues, many teachers also contribute to the union’s political action committee, some by having small amounts deducted from their Chicago Public Schools paychecks, according to Sharkey. The union isn’t required to disclose most of those donors’ names to the Illinois State Board of Elections because their contributions total less than $150 per member per quarter.

The union PAC, which anyone can contribute to, also has an annual fund-raising dinner.

Donations of $150 or less to the CTU PAC added up to more than $1.5 million between Jan. 1, 2015, and Dec. 31, 2015, records show. Of that, the CTU PAC used hundreds of thousands of dollars to help bankroll Cook County Commissioner Jesus “Chuy” Garcia’s failed mayoral campaign against Emanuel and also support various Democratic candidates, including House Speaker Michael J. Madigan, D-Chicago.

The union has no fund to pay teachers if they go on strike. Striking teachers typically end up with full pay, though, because days lost to strikes are tacked on to the school year.