Dennis Leone explains 'Pick up of the Pick up'

From John Curry, June 29, 2010
Subject: Some of you (including myself) wondered what a pick up of a pick up is.

.......so, I asked Dennis! Here's what he had to say:

"Okay -- I will do my best to explain the "Pick up of the Pick up." If a supt has a base salary of, let's say, $100,000, and the school board contractually agrees to "pick up" the supt's 10% STRS employee contribution (which would, of course, equate to $10,000) -- this means, in the eyes of STRS, that the supt's new total compensation is $110,000 instead of $100,000. Therefore, the STRS 10% requirement becomes $11,000 instead of $10,000.

The term "pick up of the pick up" means that the school board is agreeing to "pick up" both pieces -- the original 10% (i.e. $10,000 for a $100,000 base salary) plus the additional amount to cover what is considered to be the total new salary (i.e. 10% of $110,000). Hope this makes sense. If one thinks about, it's clever on the part of STRS to make sure it obtain total contributions, which would occur if someone receives a bonus. A "pick up" is truly the same as a bonus. In my eyes, STRS is doing the right thing in this area."

Dennis Leone