After railing against “a special one-off deal for Chicago” the day before, Governor Bruce Rauner changed his tune on a CPS bailout from Springfield at an impromptu press conference in the Thompson Center Thursday afternoon. Offering a package that would address every level of Chicago Public Schools’ financial woes, Gov. Rauner required that one of the biggest parts of his “Turnaround Agenda”, limiting local unions’ collective bargaining rights, be part of the deal.
Rauner described closed-door conversations with Mayor Rahm Emanuel and Senate President John Cullerton as “productive”, while chastising House Speaker Michael Madigan for his unwillingness to budge on his reform package, repeatedly calling for a “two-way street”.
Underlined by a packet his press team handed out before the press conference, Rauner offered to delay CPS’ $600 million dollar pension payment, give the district a $450 million cash advance, and chip in pension costs for FY16 and FY17. Pressure is building for CPS’s finances, as it is expected to release its district-wide budget early next week and schools are to open on September 8.
In exchange, Rauner wants to “allow local governments and local school districts to decide what issues get collectively bargained, just like Chicago has already asked to be done. And the state has already done as a special arrangement to Chicago,” the Governor said, recalling the city’s request in 2011 for the state to amend collective bargaining rights for Chicago Teachers Union members so the City could force teachers to pay their portion of pension costs. CPS has been picking up the tab for that bill for decades but officials say they can no longer afford to make the required annual payment because of its $1 billion pension shortfall
Earlier this week, the State Senate passed a measure that does half of what Rauner called for, SB318, that would freeze property taxes, overhaul the state’s funding formula for public schools, and provide additional aid to the Chicago Public Schools’ pension fund–but lacks any mention of collective bargaining. The bill, passed by a 37-1 vote, establishes a two-year local property tax freeze starting in 2016. Governments in Cook County would get a delayed rollout under the measure, with a property tax freeze taking effect in 2017.
As for the aid to the Chicago Public School Teachers’ Pension & Retirement Fund, the state would be required to contribute $200 million this fiscal year. The state mandated deadline requiring the teacher’s pension plan reach 90% funding would be extended four years to 2063.
The bill has advanced to the Illinois House, where it is likely to stall under Speaker Michael Madigan.
Speaking at a morning press conference yesterday, Speaker Madigan said he needed more time to review the legislation, which he described as “multi-faceted”. He also reaffirmed his support for amending the state’s funding formula, noting that Chicago should be treated differently because it has the highest number of students in the state that are low-income. But he refused to budge on the Governor’s proposed restrictions on unions, saying it hurts working families and “bumps up against core beliefs” held by both parties.
In a written statement released about an hour after Rauner’s presser, CPS’s newly appointed CEO Forrest Claypool emphasized the clock is ticking for CPS, “We look forward to working towards a quick resolution that treats all of the state’s children equally,” Claypool’s statement said. “After recently making $200 million in cuts, Chicago Public Schools cannot afford to wait any longer to address this inequity.”
Complicating matters even more, hours later, CPS told the Chicago Tribune they are dropping the offer of a one-year contract agreement with the Chicago Teacher’s Union, and are now requesting a multi-year deal.
Late yesterday the Chicago Teacher’s Union announced a press conference for today at 11:00 a.m. at CTU headquarters. Karen Lewis is expected to discuss their position on contract negotiations.