New Contract Earns Chicago Schools 2nd Credit Downgrade – In One Quarter

[Valin]

Townhall:

Kyle Olson

9/29/12

 

Sound financial management clearly wasn’t a concern to any party involved in the recent contract negotiations in Chicago Public Schools.

 

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Moody’s wrote:

 

“The negative outlook reflects the school district's budgeted depletion of reserves to fund ongoing operations in fiscal 2013; the moderate additional unbudgeted salary costs of labor contract negotiations, which have not yet been ratified by CTU; an estimated $1 billion budget deficit for fiscal 2014; and the sizable increase in pension contributions following a three-year relief period. Significant budget adjustments will be necessary, but the demonstrated power of collective bargaining suggests that future budget controls may be difficult for the district to implement.”

 

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