Big trouble is brewing in Chicago, the nation’s second-largest school district, as negotiations between the city and teacher representatives moves closer to a strike deadline on September 10. Chicago teachers have filed a strike notice that, if acted on, would be their first strike since 1987. The main disagreement between the teachers and the city is Chicago Mayor Rahm Emanuel’s plan to lengthen both the school day and the year. The district is offering teachers an eight percent raise over four years, and it wants to form a committee to create a new pay system.  Chicago teachers, the second highest-paid teachers nationally after New York City, say the fight is not about compensation, but rather that the mayor is actively withholding resources from the Chicago Public Schools system. The rhetoric has become inflammatory. Teachers’ union president Karen Lewis called Emanuel “a liar and a bully” while exhorting a union crowd at a Labor Day rally.  The political ramifications of the Chicago feud stretch far beyond the shores of Lake Michigan. Emanuel was previously President Barack Obama’s chief of staff. He is still a leading Democratic figure representing an important voting block in Illinois. The opposition he has created with Chicago teachers, an important base of the Democratic party, could not have come at a worse time as the incumbent president and Democratic-controlled Senate fight to stay in office. There is more at stake with a teacher’s strike than whether Chicago school children will miss a few days of school.  It is not clear to me why Emanuel has made longer school sessions the main issue in reforming Chicago schools. School graduation rates have increased the last five years, according to the CPS. This year will see the highest-recorded rate of graduation at 60.6 percent, according to CPS CEO Jean-Claude Brizard. Obviously important progress is being made without packing more hours into the school day.  According to CBS, the average annual salary of a Chicago teacher is $76,000, without benefits; substantial compensation for nine months of work per year. However, when you glance over the payroll listing for Chicago school employees, you see salaries in public schools and central administration are robust for all school employees. But in the current negotiations, they are being asked to work longer hours with only a tiny increase in pay.  The area that seems to be the biggest challenge for the city and school system in Chicago is the underfunded pension system. The city was granted a partial holiday by the State General Assembly and allowed to divert the majority of their pension contribution to the school system’s general budget. According to the Chicago Tribune:  “Last year, the teachers’ pension fund received $187 million, $400 million less than the amount it should have gotten. When the holiday ends in 2014, the district’s pension costs are expected to more than triple to $647.8 million, adding even more stress to the CPS budget.”  In addition to under-funding the pension system, the school system also had a big increase in teacher retirements recently, WBEZ91.5 reported in May:  “The number of Chicago teachers retiring this year is getting close to a record-breaking level. So far 1,954 Chicago teachers plan to retire. The Chicago Teachers Pension Fund estimates that number will hit 2,000 before summer ends. That would be a 40 percent jump over last year.”  A big jump in teacher retirements will put additional pressure on the under-funded pension system. According to the Chicago Teachers Union, teachers contribute nine percent of their annual salary toward retirement. A bill being considered in the state capital (SB512) would increase teacher contributions from nine percent to 12.75 percent. I guess Mayor Emanuel is hoping that the state legislature does the heavy lifting on increasing contributions to the pension plan, which is only funded at 58 percent, far below the minimum 70 percent to be considered healthy.  The fiscal pressures facing cities are likely to result in more friction. Public employees, politicians and taxpayers are all facing tough choices about the level and costs of public services like education. More situations like the teacher negotiations in Chicago are likely to appear. Let’s hope that they are less contentious.
Chicago teachers are planning a strike that could challenge a proposal to lengthen the school year. The challenge comes amid a time when the city already finds itself with underfunded teacher pensions.