Board of Education members unanimously voted Wednesday not to pay teachers the 4 percent raises due in their union contracts, approving a motion stating that the board does not have a reasonable expectation of finding money to pay the increases. The Chicago Teachers Union has vowed to fight. Late Wednesday, all seven unions sent a letter to the board stating that they want to reopen the contract, but only the section regarding salaries, according to CTU spokeswoman Liz Brown.
Board of Education members unanimously voted Wednesday not to pay teachers the 4 percent raises due in their union contracts, approving a motion stating that the board does not have a reasonable expectation of finding money to pay the increases.
The board’s vote denies raises promised in seven labor contracts for teachers, support staff, lunchroom personnel, building engineers and others.
Also during the meeting, officials disclosed a revised projection of the district’s budget deficit, now pegged at $712 million. The new projection includes some new factors that district officials say creates the deficit and not others previously included.
As a result of Senate Bill 7, the bill just signed into law by Gov. Pat Quinn that limits teacher tenure and strike rights (among other provisions), the length of the school day has become a “permissible” subject of contract talks.
The vote by the board could eventually lead to a teacher’s strike, but Senate Bill 7 creates a long road for that to happen. Once a contract is reopened, the district and the union have to reach an impasse after a “reasonable’ period of negotiating. Then, if an impasse is reached, the new law calls for 90 days of fact-finding and another 30 days for the fact-finding details to be made public.
In addition, under the new law, the union would have to convince 75 percent of voting members to authorize a strike—a provision that applies only in Chicago. Elsewhere in the state, a strike authorization requires approval by only 51 percent of members.
CTU President Karen Lewis, who left the board meeting early to convene with the leaders of the other unions involved, had urged board members to fund the raises to show teachers that their work is valued and respected. “We did not get into this financial mess by overpaying the teachers and the lunch ladies,” Lewis said.
Board President David Vitale—a former chief administrative officer for the district—said he hoped teachers would be understanding of the board’s position. “Our hope is that they would work productively to put children first,” he said. Vitale said after the meeting that plans are being made to lengthen the school day, but did not give details.
Board members did not have a public discussion about the issue. Instead, they decided to go into closed session when member Jesse Ruiz had a question (perhaps wanting to chat privately with his colleagues).
But board members did ask several questions during a detailed presentation on the district’s budget picture. District officials were well-prepared for the questions, using the opportunity to make points that seemed aimed at letting the audience know that teachers would, in fact, see some additional pay in the coming year.
For example, board member Mahalia Hines, a former principal, asked Chief Human Capital Officer Alicia Winckler to explain STEP/Lane increases, which the board plans to pay at a cost of about $35 million. Winckler responded that these are salary increases given to teachers based on years experience and education attainment and that 74 percent of teachers will be getting them.
Hines also asked Winckler to explain how the salaries of Chicago teachers compared to those in other urban districts. Winckler said CPS teachers’ minimum, maximum and average salaries are either the highest of the Top 10 urban districts or the second-highest.
In her presentation to the board, Karen Lewis made the case that the salaries of CPS elementary teachers were ranked 31 in Illinois, while the salaries of high school teachers ranked 70. Later, she called Winckler’s numbers “ridiculous.”
This will not be the first time CPS has sought to use promised raises as a negotiation point with the union. Last year, former CEO Ron Huberman and the previous board threatened to raise class sizes if teachers did not forego raises, but in the end, federal stimulus money and other funds helped to prevent either scenario.
In July 1990, the then-Interim School Board appointed by former Mayor Richard M. Daley agreed to a three-year teacher contract promising a 7 percent raise each year. As it turned out, the board could not afford the increases. Negotiations were reopened for the both the second and third years of the contract and continued months into the school year under the threat of a strike.
Teachers eventually agreed to lower salary increases.
Up until 1995, when Daley took control of CPS, the district’s finances were overseen by the former School Finance Authority. Today, there is no independent oversight of the budget, except for the Board of Education, which, like the CEO, is appointed by the mayor. Teachers’ union officials have recently called for more transparency in the budget process, asking to see a document listing revenues and expenditures.
On Wednesday, Vitale asked Chief Operating Officer Tim Cawley why the components of the budget deficit, as well as the final projection, had changed. Cawley said the original projection was generated in November by the previous administration, and that much had changed since then.
Lewis rolled her eyes at the revised figures. “The administration is playing games,” she said. The unions want to see a line-item budget during new contract negotiations, Brown said late Wenesday.
Later, Vitale said all the components of the budget deficit made sense to him. Other board members did not, publicly at least, question the details.
The original projection of $724 million included a loss of $260 million in federal stimulus money; a loss of $104 million from the Education Jobs Bill, an emergency grant passed in August 2010; $190 million needed to replenish the district’s depleted fund balance; plus $100 million for salary increases and $70 million for Step/Lane, healthcare and pension increases.
The new projection includes some of the same elements, as well as new figures.
The salary increases, as well as the STEP/Lane, healthcare and pension increases, are still listed as expenses above and beyond last year’s costs. But the new projection includes $156 million in increased costs that district officials had not revealed before.
OPERATIONAL EXPENSES Cawley now says that the district is expecting its operational expenditures to go up by $86 million. About $25 million of that will go to pay interest to banks.
Another $25 million is the result of additional payments to charter schools, including four new charters and several others that are adding more grades and therefore more students. Charter schools receive money on a per-student basis. (Traditional CPS schools have a staffing formula that is based on their student enrollment.)
PAYING CHICAGO POLICE Officials say that for the last few years, CPS has been under-paying Chicago police for staffing each high school with two police officers and that the district now owes the Chicago Police Department $70 million. Cawley said that when he walked in the door in early May, negotiations with the police department were already underway to pay them this money.
CPS has been underpaying the police department for four years, he said. “This has already been kicked around here, hoping it would just go away,” he said.
At the same time, CPS has higher expenses, revenue is decreasing.
FEDERAL STIMULUS RUNNING OUT CPS officials still say they will spend all the $260 million in federal stimulus money they were awarded last year. Though much of that money was used to fill holes, some of it went to new programs, such as the district’s violence prevention initiative Culture of Calm. CPS officials have decided they will keep the program going, though they are trying to scale back some costs.
Federal stimulus money must be spent by August 31.
ED JOBS MONEY STILL ON HAND Education Jobs money can be carried over from one year to the next. CPS officials now say that they only spent $54 million of the money, which means that the district still has $50 million to spend this coming year.
REDUCTION IN BOND RESTRUCTURING BENEFITS Last year, when then-CEO Huberman told the board that they planned to drain the district’s reserves, some members balked. Then, at the last minute, Huberman and his chief financial officer announced they would restructure some bonds, which would provide some extra money.
Cawley says that the reserves remain at $198 million, but that CPS won’t reap any benefit this coming year from the $160 million in bond restructuring.
STATE APPROPRIATION The new projection includes a $77 million cut in state funding, based on the state budget that has been passed by lawmakers, although not yet signed by Gov. Quinn. The district expects $37 million less in general state aid provided for low-income children—though that might be offset by a change in the number of poor children—and $6 million less for early childhood education.
The state is also expected to give the district $33 million less for its pension, according to CPS.