Chicago Schools Reopen as City's Dispute With Teachers Festers
Chicago Schools Reopen as City's Dispute With Teachers Festers
(Bloomberg) -- Chicago students head back to class Wednesday, with tensions between city leaders and the teachers’ union far from resolved.
Across the country, officials are trying to keep government, businesses and schools open, and unionized workers are pushing to ensure protections from Covid-19. In Chicago, instruction was canceled for five days in the nation’s third-largest district after the teachers’ union voted to go remote against city officials’ wishes. The heated dispute left 330,000 students out of class and marked the third such work stoppage in as many school years.
Even as a deal was announced late Monday, a union vice president described Mayor Lori Lightfoot as unfit to lead, and the mayor expressed frustration over the union’s repeated disruptions to the district. The labor strife risks alienating current and potential residents as Chicago tries to rebound from population loss. It also raises questions for investors about the growth prospects of a city with an unpredictable public school system.
“That type of friction, it makes people less confident in the system,” said Deborah Carroll, director of the Government Finance Research Center at the University of Illinois in Chicago. “That potentially could have longer term consequences. Schools are a big reason people move to particular places.”
The fight caught the attention of the White House as most students across the U.S. returned in person after the holidays. The Biden administration urged the two sides to reach a resolution amid the president’s push to keep schools open. Such closures could spell trouble for Democrats, who control Congress and the White House, as parents grow frustrated by the inconsistency and instability they cause.
“The CDC is moving more in the direction of ‘how do we live with the virus’,” said Michael Hartney, assistant professor at Boston College. “Parents and voters look around and say: why do schools, colleges and universities have the most strict interventions still in place?”
The nation’s two largest districts, in New York City and Los Angeles, returned to classrooms after the winter break with strict protocols on testing and masks.
On Wednesday, the union’s membership concluded its vote and approved a deal with the district on additional Covid-19 mitigations and the return to in-person learning with about 56% in favor, according to a union spokesperson.
Almost 89% of union teachers reported to school Wednesday even before results of the broad membership vote were released, the district said. While the district returned to in-person learning on Wednesday, some schools flipped up to 10 classrooms to remote learning due to Covid-19 cases as well as students identified as close contacts, according to the statement.
In Chicago, “emotions are high,” according to a statement from teachers’ union president Jesse Sharkey. Parents and local businesses have had to contend with repeated disagreements between the mayor and union that have led to last-minute announcements to close schools the next day. It’s left many families of students, 46.6% of whom are Hispanic and 36% are black, to have to find child care or call off work.
“There does come a point where enough is enough,” Lightfoot said at a press conference Monday to announce the reopening of classes. “Three work stoppages in three years. Of course, people are frustrated.”
In 2019, the union held a two-week strike to demand higher pay as well as more nurses and social workers in schools. Then after the winter break in early 2021, the union’s actions led to a delayed and phased-in return to school. The union also has had clusters of work actions since the 1980s.
“The disappointing fiasco among the CTU, CPS and Mayor Lightfoot is not only affecting students, parents, and families, but also businesses of all types and sizes, especially minority-owned businesses,” the Illinois Hispanic Chamber of Commerce said in a statement.
The school system has lost more than 40,000 students in the last five years with the decline accelerating during the pandemic. Enrollment is down 7% since the start of the 2019-2020 school year, according to district data.
Chicago has struggled to maintain its student population, and a functioning education system is key to reverse the loss of students, according to the Civic Federation, a watchdog group that tracks the city’s finances.
The shutdown of the school system is “very corrosive to the business climate and Chicago’s reputation overall,” said Laurence Msall, president of the group. “The city prides itself on being an international city, being an attractive place for people to not just work and live but raise their children.”
Junk Bonds
Shrinking enrollment and the contentious relationship with the union are challenges, according to S&P Ratings, which rates the Chicago Board of Education bonds junk.
“The historically contentious relationship between the board and the CTU, reflected in recent strikes and strike votes, represents an elevated governance structure risk,” Blake Yocom, an analyst for S&P Global Ratings, said in a report on Jan. 10. “The pandemic intensified this challenge, stemming from opposing viewpoints on in-class instruction and potential virus exposure risks.”
Still, Ty Schoback, a senior municipal research analyst for Columbia Threadneedle Investments, said he’s taking a long-term view of the school system as the city and district’s financial outlook has improved recently, partly thanks to billions of dollars in federal aid. All three rating companies upgraded the district’s credit rating last year, though they still consider its bonds to be below investment grade.
Investors will demonstrate their appetite for the debt when the Chicago board comes to market the day after students return to classrooms. The district is slated to sell about $863 million in bonds on Thursday.
“There is some concern about this repetition of work stoppages that seemingly happen like clockwork, that are highly disruptive to city residents with children,” said Schoback, whose firm holds Chicago and Chicago Board of Education debt, as part of $17 billion in muni assets. He said he will look at the deal. “If it’s the start of a trend, that’s more concerning.”
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