The Board of Education is considering an amendment to this year’s Chicago Public Schools budget that could finally force a decision about whether it will make a disputed pension payment and how it will pay for a new Chicago Teachers Union contract that is still being negotiated.
The amendment, which was posted Wednesday, doesn’t include the funding for those expenses. It leaves open the possibility of a loan, suggesting it could be taken out by an entity other than CPS but not specifying what other entity would do it. It also suggests additional money could come from City Hall or budget cuts — but at this late point in the school year, it would be hard to find places to save money other than through furloughs or layoffs, which Mayor Brandon Johnson and his allies at the CTU are staunchly against.
At the same time, CTU leaders on Wednesday presented school board members with what they called their “last, best and final offer” to settle contract talks. The union is telling its members it has already negotiated “transformative” agreements — an important sign it is looking to land a deal. But a CTU lawyer warned the board to take into account the union’s final list of demands to avoid a “big, messy, unnecessary fight.”
The coming two weeks will be pivotal in determining what happens next.
The CTU has fulfilled the legal steps necessary to strike. It could walk out as soon as March 17 if it doesn’t reach a deal, though the union must provide 10 calendar days’ notice of its intent to strike. CTU leaders haven’t called for members to take a strike authorization vote.
Hearings on the amendment are scheduled for March 13 and 14. A vote on a budget change is expected on March 20.
Altering the budget would bring to a head a long-running conflict between the mayor, his former employers at the CTU and the school district’s administration. CPS typically doesn’t include money in its budget — which is approved the summer before classes begin — for a new teachers contract when it’s still being negotiated. The district usually amends the spending plan once the contract is landed. This year there’s also an anticipated contract with the new principals union.
Rebuking the mayor, CPS CEO Pedro Martinez and a previous board also did not include in the budget $175 million for a payment to the municipal pension fund, which serves CPS employees who aren’t teachers. The school district has paid it for the past four years — starting under former Mayor Lori Lightfoot, despite objections from the CTU at the time. Martinez argued that the school district was facing a particularly tight budget this year after being flush with $2.8 billion in federal COVID-19 relief money.
Still, the city’s budget counted on CPS making that payment, and now City Hall says it needs that $175 million by March 30 to close its 2024 budget in the black.
CPS needs $242 million
The city provided CPS record funding from special taxing districts called TIFs, but to make the pension payment and salary increases promised in the teachers contract, the school district would need another $242 million.
The proposed budget amendment adds to CPS’ balance sheet a previously announced $139 million in TIF funding. But beyond that the language is vague, leaving it unclear whether the school board will take out a loan to make the pension payment and cover the teachers contract. It says the school district will take on the pension payment as well as salary increases for teachers and principals using TIF funding, budget cuts and “other appropriate local revenue, which may include other entities incurring debt on CPS’ behalf.”
But the mayor’s office has suggested that CPS borrow to cover these expenses, which has sparked an onslaught of criticism because of worries the loans would carry high-interest rates for an already indebted school district. Johnson has recently renewed his push at an interest rate of 4.37% for a five-year loan or 4.6% for 10 years — rates that are relatively low for CPS.
“Mayor Johnson has maintained that Chicago Public Schools has an obligation to its workforce and its retirees and this proposed budget amendment is in line with that obligation,” the mayor’s office said in a statement. “Mayor Johnson is supportive of any tools that the school district can utilize on its behalf to balance its budget without cutting teachers or resources for students.”
A staffer from the Chicago Public Education Fund, an organization supported by top philanthropic and business interests in the city, came to a board meeting Wednesday to urge board members not to take a loan. Mariel Laureano, CPEF director of education supports, told members that she worries debt payments will eat into money that’s supposed to go for education.
“Please don’t take the risk,” Laureano said. “Prioritize the needs of school communities.”
The amendment needs two-thirds of the 21-member board to pass, and many of the elected board members pledged not to borrow when they were running. Eleven school board members — including the board president — are still appointed by the mayor, and three elected members had strong backing from the CTU. The board president, however, doesn’t vote unless there is a tie. So 14 of the other 20 members would have to approve an amendment.
There’s expected to be a strong push from members aligned with the mayor and CTU to go along with the borrowing and make the pension payment. During a presentation on a TIF-funded school building project Wednesday, board member Norma Rios-Sierra said CPS has a “need to maintain our obligation with the city so that we can continue to provide these partnerships for our schools.”
CTU kicking into high gear
The timing of the amendment also is putting a fire under the CTU, which has been negotiating its contract for almost a year.
CTU President Stacy Davis Gates said at a news conference before Wednesday’s board meeting that the union is worried that once an amendment is approved it will hamstring its ability to keep bargaining.
“So we are curious to understand if this is a power move by the CEO to try and marginalize the table even more,” she said.
The union presented the board Wednesday with a document showing what it needs to settle the contract. The union also brought 10 staffers to the board meeting to talk about some of the outstanding issues they need to come to agreement on.
The CTU’s “final offer” accepts the CPS proposal for 16% cost-of-living increases over four years, pushes its request for 28-student class sizes in middle school until 2027-28 and moves in the district’s direction on thorny issues like teacher evaluations. The union also lowered its demand for librarians, asking for an additional 30 librarians each of the next three school years.
The CTU also laid out more than 150 agreements with CPS on a wide range of issues.
But the union’s latest proposal still shows some major disagreement on key issues such as extra pay for veteran teachers and preparation time for elementary educators.
Sarah Karp covers education for WBEZ. Follow her on X @WBEZeducation and @sskedreporter. Nader Issa covers education for the Chicago Sun-Times.