Ominous Signs For All Chicago In Teachers Union Contract Negotiation

By: Mark Glennon*

Thursday at 6:00 p.m. Mayor Lightfoot will deliver a genuinely historic speech on her plans for dealing with Chicago’s fiscal crisis. Will she break the mold by proposing the long overdue list of drastic reforms the city needs?

If the city’s negotiations on a new contract for the Chicago Teachers Union are an indication, forget it — expect more of the same. While Lightfoot’s tough talk has reflected deeper concern than Mayor Emanuel showed, those contract negotiations indicate no profound change in direction is at hand.

To many of us, some things seem obvious. When you’re so broke that your survival is threatened you don’t raise pay. You don’t keep facilities open that aren’t even half full. You don’t provide lavish retirement benefits. You expect employees to contribute to their own retirement. You do what countless private sector companies did to survive the Great Recession – you tell your employees that a period of austerity, that may or may not be fair, is unavoidable. That’s how you live to fight another day.

We think that way because we live in an alternate universe. In government across most of Illinois, especially Chicago, habits never die, no matter what the consequences. In their universe, fiscal reality means nothing.

Lightfoot and Chicago Public Schools already offered a five-year contract including a 16% salary increase. Teachers and staff would see a total of $351 million in salary increases, according to WTTW. Between that increase and regular salary increases based on years of service, the average teacher would see their salary increase 24% over the life of the five-year deal.

The CTU rejected that and have threatened to strike. They live in yet another universe. They want a 14% increase but over a three-year deal. Other demands previously reported include more generous benefits, numerous staffing requirements, 55 additional “community schools,” a reduction in class size, creation of affordable housing for teachers and more.

Where would the money come from? “Rich people,” CTU Vice President Stacy Davis Gates said.

The final contract will probably end up somewhere between what each side has proposed, which is to say things are going the way they traditionally have. Lightfoot has shown no indication she wants to end the pattern. Lightfooot’s Thursday speech, if it goes like the CTU negotiations, would then be historic only because it sets the tone for more of the same, which would be catastrophic for Chicago.

Lightfoot should be threatening to reconstitute CPS entirely. She should be giving a shock-and-awe budget speech like we suggested for Mayor Emanuel four years ago. Almost all the specific reforms we listed then apply today. She should be educating Chicagoans about why radical reforms are needed. Respecting CPS, she should have softened the ground by telling Chicago facts like we’ve reported over the last few months, and included in the appendix below.

Those facts cry out that CPS needs structural reforms, some of which should be reflected in the new CTU contract, but they are being ignored.

If Lightfoot likewise ignores the rest of the city’s deep, structural problems, her Thursday budget address will be a sad affair indeed.

*Mark Glennon is founder of Wirepoints.

Read more about CPS, the CTU and the City of Chicago’s fiscal situations:

• Chicago’s Lightfoot demands a state taxpayer bailout, then offers CTU a 5-year contract, 14% raise?
• What Mayor Lightfoot needs to know to take on the Chicago Teachers Union
• Viva Maduro! The Chicago Teachers Union’s Solidarity Trip To Venezuela
• This is why Illinois pols haven’t fixed our fiscal crisis
• How Springfield Should Authorize Lightfoot To Negotiate With CTU (But Won’t)
• Ignoring the elephant in the room: Chicago Mayor Lightfoot skips pension reform
• Chicago’s pension funds looking more like a collapsing Ponzi scheme
• The Shock and Awe Budget Address Rahm Should Have Given

APPENDIX — CPS TODAY

•  Chicago teachers are already highest paid compared to teachers in similar districts according to data from the National Center on Teacher Quality.

For example, a Chicago teacher with a master’s degree receives $80,000 a year after ten years of work. In contrast, an equivalent teacher in New York City makes $70,000 and a Los Angeles teacher makes $60,000.

A big reason for that is due to how fast Chicago teacher salaries grow. The average new teacher with one to four years under her belt starts out with a salary just above $50,000. By the time that teacher reaches 10 to 14 years of service, her salary grows to more than $85,000 annually.

•  The average career Chicago teacher will get $2 million in total pension benefits, far more than ordinary Illinoisans.

High salaries translate into big pension benefits for career teachers. The average CPS teacher who retired in 2018 with 30-34 years of service had a final average salary of nearly $98,000 and a starting pension of over $70,000. Their average retirement age was 61.

That pension will increase automatically by 3 percent each year and by year 25 of retirement, the pension will be double its starting amount. In all, the average retired career Chicago teacher will collect over $2.1 million in benefits over the course of her retirement.

In contrast, an ordinary Illinoisan at retirement would need to have around $1.5 million in his or her account at retirement to collect the same amount of benefits as a career Chicago teacher. Most Illinoisans will never save that amount of money.

•  Taxpayers still “pick up” a majority of Chicago teacher pension contributions. Chicago teachers are supposed to contribute 9 percent of their salary every year towards their pensions. But every year since 1981, CPS has paid for, or “picked up” 7 of that 9 percent.

That means Chicago teachers only have to pay 2 percent of their salary towards their own. That costs Chicagoans over $100 million a year. Mayor Emanuel tried to reform pickups in 2016, but he was rebuffed by the union. Only new workers lost the pickup. And even then, the district gave out extra 3.5 percent raises in exchange.

•  CPS is losing students but spending more on them than ever before. One of the CTU’s contract demands calls on CPS to spend money to hire more teachers and even more support staff. That might make sense in a dynamic, rapidly growing city with a growing school population.

But CPS is losing students and has been for nearly 20 years. At the same time, the district’s spending per student has jumped.

In all, CPS’ per student spending has doubled since 2000 according to ISBE, even as the district’s enrollment has fallen by nearly 75,000 students, or 17 percent, over the same time period.

•  Near empty, failing schools should be closed and their resources redirected.

Declining enrollment is hitting some Chicago schools particularly hard. In 2017, the Chicago Tribune examined the demographics of some of the most underpopulated schools in Chicago. It found the enrollment of the 17 worst schools has dropped from nearly 20,000 in 2008 to just over 4,600 today. Their buildings are, on average, filled to just 20 percent capacity.