In The Matter of the Factfinding Concerning, ‘The Board of Education of the City of Chicago and Chicago Teachers Union Local 1, AFT, AFL-CIO REPORT AND RECOMMENDATIONS This matter arises under Section 12(a-10) of the Illinois Educational Labor Relations Act, 115 ILCS 5/12(a-10). In accordance with that provision, the Board of Education of the City of Chicago (“Board”) appointed Mr. Paul J. Ciastko as its representative on the factfinding panel, Chicago Teachers Union Local 1 (“Union” or “CTU") appointed Mr. Robert E. Bloch as its representative. The partics jointly selected Martin H. Malin as the neutral chair of the factfinding panel. “The factfinding panel was constituted when the Board appointed Mr. Ciastko on October 7, 2024. The statute requires the panel to issue a private report to the parties if the dispute is not settled within 75 days following its appointment. The parties agreed to waive this timeline to afford them time for further negotiations. The Panel conducted a hearing on January 22 and 24, 2025. Each party provided a list of issues it was submitting to the Panel. For the most part, the lists overlap. The Board submitted; ‘Term of Agreement (Proposal to modify termination date from July 1 to May) Salaries (COLA and step increases; Article 36, Appendices A and F) Staffing Outstanding financial items including coaching stipends/ELPT stipends/fine arts budget/workload funds/supply money etc. ‘Teacher preparation time and professional development (Articles 4, 5, 6, 19, 25 and Elementary School Day) Clinicians (Article 20) Teacher Evaluation (Article 39) ‘Mid-year transfers (Article 35-4) Class size limits, automatic support, class size relief funding (Article 28) ‘School closings and Charter expansion moratoriums (Side Letters) Grievance and arbitration process changes (Article 3) ‘Assessments (Article 44-32)The Union submitted: Term of Agreement Salaries (COLA and Step Increases) Staffing Teacher Preparation Time, Professional Development, and the Elementary School Day PSRP Issues Sports Early Childhood Education Clinicians and Counselors Guest Teachers/Class Coverage Teacher Evaluation Assessments Class Size ‘School Closings and Charter Expansion Moratoriums The factfinding hearing was held at Franczek, PC. The Board was represented by Ms. Sally J. Scott and Ms, Nicki B. Bazer. The Union was represented by Mr. Robert E. Bloch, Mr. ‘Thaddeus H. Goodchild and Ms. Latoyia M. Kimbrough. At the hearing, both parties were afforded full opportunity to call, examine and cross-examine witnesses, introduce documentary evidence and present arguments. ‘The parties have agreed that the Report and Recommendations is to be issued by the neutral factfinder without need for concurrenees by or signatures from the party-appointed members of the panel. However, the party-appointed members of the panel may file concurring or dissenting opinions and the filing of such shall not constitute a rejection of the recommendations contained in the report. Background ‘The CTU represents a bargaining that includes teachers and paraprofessional and school related personnel (PSRPs). The CTU-Board collective bargaining agreement (“CBA”) expired on June 30, 2024, but the parties have abided by its terms pending the outcome of impasse procedures, SEIU Local 73 (Local 73) represents a bargaining unit that includes special education classroom assistants (SECAS), bus aides, security officers, custodians (including factor ‘custodians and lead custodians) and parent workers. Local 73 and the Board have reached agreement on the terms of a new CBA.‘The current impasse procedures for CPS were enacted by the Illinois Legislature in 2011. ‘The CTU and the Board engaged in factfinding before a panel chaired by Edwin Benn in 2012, before a panel chaired by Steven Bierig in 2016, and another panel chaired by Factfinder Bierig in 2019, Local 73 and the Board engaged in factfinding before a panel chaired by me in 2019. ‘The Factfinding Process under IELRA Section 12(a-10) ‘The statute provides that the recommendations shall be based “upon the following criteria as applicable:” (A) the lawful authority of the employer; (B) the federal and State statutes or local ordinances and resolutions applicable to the employer; (©) prior collective bargaining agreements and the bargaining history between the parties; (D) stipulations of the parties; (E) the interests and welfare of the public and the students and families served by the employer; (F) the employer's financial ability to fund the proposals based on existing available resources, provided that such ability is not predicated on an assumption that lines of credit or reserve funds are available or that the employer may or will receive or develop new sources of revenue or increase existing sources of revenue; (G) the impact of any economic adjustments on the employer's ability to pursue its educational mission; (HH) the present and future general economic conditions in the locality and State; (D a comparison of the wages, hours, and conditions of employment of the employees involved in the dispute with the wages, hours, and conditions of employment of employees performing similar services in public education in the 10 largest U.S. cities; (D the average consumer prices in urban areas for goods and services, which is commonly known as the cost of living; (K) the overall compensation presently received by the employees involved in the dispute, including direct wage compensation; vacations, holidays, and other excused time; insurance and pensions; medical and hospitalization benefits; the continuity and stability of employment and all other benefits received; and how each party's proposed compensation structure supports the educational goals of the district; (L) changes in any of the circumstances listed in items (A) through (K) of this paragraph (4) during the fact-finding proceedings;(M) the effect that any term the parties are at impasse on has or may have on the overall educational environment, learning conditions, and working conditions with the school district; and (N) the effect that any term the parties are at impasse on has or may have in promoting the public policy of this State, In my 2019 report and recommendations for the Board and Local 73, I discussed this statutory provision. That discussion bears repeating because it guides me in the instant matter. I wrote (footnote omitted): The listing of statutory factors evokes analogy to interest arbitration under Section 14 of the Illinois Public Employment Relations Act, 5 ILCS 315/14. However, there are significant differences. Under the IPLRA, interest arbitration is provided as a substitute for strikes by law enforcement, firefighters and a few others who for matters of public safety are prohibited from striking. Subject to very limited exceptions for review by Circuit Court and rejection by super-majority vote of the employer's governing body, the interest arbitration award provides finality to the parties’ collective bargaining process. Consequently, most arbitrators, including me, view their role as determining, based on the statutory factors, the contract that the parties likely would have reached had their negotiation process not broken down. Under the IELRA CPS impasse procedures, however, the employees retain the right to strike. Factfinding does not bring finality to the parties’ collective bargaining process. Instead, itis a step in that process. It makes no sense for the factfinder to seek to determine what terms the parties would have agreed to had their process not broken down because their process is continuing. Instead, the role of the factfinder is to recommend the terms that the parties should agree to in their on-going negotiation process. Such a role recognizes that the statute envisions that once the parties receive a confidential report from the factfinder, the recommendations of that independent neutral will motivate them to reconsider their positions and move toward agreement. Furthermore, if the parties do not reach agreement and at least one party rejects the recommendation, then the factfinder’s report is made public and the expectation is that public pressure will further ‘motivate the parties to reassess their positions and reach agreement without a work stoppage But the factfinder does not have carte blanche to recommend his personal ideal of where the parties should end up in their negotiations. Rather, the statute limits the factfinder to the enumerated factors in determining what agreement the parties should reach. Notably, IPLRA § 14(H)(8) allows the interest arbitrator to consider “Such other easfactors, not confined to the foregoing, which are normally or traditionally taken into consideration in the determination of wages, hours and conditions of employment through voluntary collective bargaining, mediation, fact-finding, arbitration or otherwise between the parties, in the public service or in private employment.” The IERLA’s factors for factfinding contain no comparable provision. On the other hand, whereas the IPLRA confines the interest arbitrator to selecting the final offer of one of the parties in resolving. impasses over economic issues, the IELRA factfinding statute imposes no such limitation on the neutral. ‘The Union emphasizes that the statute calls for basing the findings and recommendation on the enumerated criteria “as applicable,” The Union urges that Factor F’s provision precluding consideration of “an assumption that lines of credit or reserve funds are available or that the ‘employer may or will receive or develop new sources of revenue or increase existing sources of revenue” cannot be applicable because it bears no relationship to how collective agreements are actually negotiated. The Union’s interpretation of the words “as applicable” reads them as granting me authority effectively to rewrite the statutory criterion. I cannot read those two words as broadly as the Union urges. ‘The Board urges that “as applicable” simply means that I need not consider criteria that obviously do not apply. For example, says the Board, here there were no stipulations by the parties and, accordingly, Criterion D is not applicable. I cannot read “as applicable” as narrowly as the Board urges. Teonclude that the statutory authority to base my findings on the delineated criteria “as applicable” authorizes me to weigh each criterion in light of the other enumerated criteria. Of particular relevance to Criterion F is Criterion C, “prior collective bargaining agreements and the bargaining history between the parties.” The record reflects that the Board does not restrict itself to the Criterion F proviso in deciding what to offer and what to agree to. CPS Chief Budget Officer Mike Sitkowski testified that in 2016, the Board had to make mid-year cuts and refinance debt (“scoop and toss”) even though the CBA provided for 0% across the board increases and in 2019 the Board did not have the funds to pay for the first year of the CBA but covered it with the savings it achieved from strike days that were not made up and covered subsequent years with federal Covid relief funds. With respect to the Board’s current proposal, Mr. Sitkowski related that the Board projects a deficit of $750 million in FY 2026. He characterized closing that gap as “in the realm of doable” with anticipated revenues (e.g. CPS commonly receives more TIF revenues than it projects in its budget) and efficiencies that will not negatively impact the delivery of services. Criterion C carries significant weight and must be balanced against the weight to be given to Criterion F.This does not mean that I may disregard CPS’s financial condition. On the contrary, the importance of CPS’s financial condition is underscored by Criteria E, G and H. With respect to Criterion I, CTU urges that I disregard Phoenix, Dallas, Houston and San Antonio because they do not engage in collective bargaining and therefore their wages and working conditions are not applicable. Here too, the Union is asking me effectively to rewrite the statute, something that I lack authority to do. Local 73 made a similar argument in 2019. My rationale rejecting that argument bears repeating: {I]n interest arbitration we would not consider as comparable a community where the employees are not represented in collective bargaining . .. That is because in interest arbitration the arbitrator’s role is to determine the terms the parties would have agreed to had their bargaining process not broken down and terms imposed unilaterally by an employer on unrepresented employees are of no probative value for that determination. But in this factfinding my task is to recommend the terms on which the parties should agree and the statute defines the communities to which I should compare CPS as the ten most populous cities, not the ten most populous cities whose terms and conditions of employment are determined in collective bargaining. Under the statute, the factfinding process is a continuation of the parties’ collective bargaining process. That is a significant difference from the typical adjudication process. As Factfinder Bierig recognized in 2019 and as I recognized in the 2019 factfinding with the Board and Local 73, it can be appropriate to remand some matters to the parties for further negotiations. With the above discussion in mind, I turn to the parties” differences with respect to compensation and staffing. ‘Compensation Actoss the Board Increases (COLAs) ‘The parties have agreed that the CBA will cover four years. They have agreed that in years 3 and 4, the COLA will be 4.0% if the CPI-U increases 4.0% or less, using the U.S. City Average June CPI-U released in July, rounded to the nearest tenth. If the CPI-U increases between 4,0% and 5.0%, the COLA will equal the increase in the CPI. If the CPI increases more than 5.0%, the COLA will be 5.0%. The cost of each 1.0% increase in COLA is approximately $30 million.‘The Union proposes 5% increases in each of the first two years of the CBA. The Board proposes a 4% increase in the first year and applying the same formula agreed to in years three and four to the second year. CTU observes that the COLAs in the 2019-24 CBA failed to keep pace with inflation. ‘The COLAs totaled (non-compounded) 17% while the CPI increased 22%,' CTU recognizes that its proposal exceeds current and projected increases in the CPI but urges that this is necessary to make up for ground lost in the prior CBA. The Board responds that over the course of the new CBA, COLAs will make up lost ground, observing that current forecasts project average annual increases of 2.3% for 2025-2029. The Board further urges that increase in COLAs understates the actual increases in compensation experienced by most employees who also benefit from step increases and lane advancements. agree with the Board that in considering how employees fare vis-a-vis the cost of living one must consider the impact of step increases in addition to COLAs. And typically I would also place considerable weight on projected increases in the CPI, particularly those emanating from the Federal Reserve Bank of Philadelphia's Survey of Professional Forecasters. However, we do not live in typical times. President Trump just imposed tariffs of 25% on goods imported from Canada and Mexico, with the Mexico and Canada tariffs paused for 30 days, and 10% on good imported from China. He promises more tariffs to come with tariff impositions used to threaten countries that try to resist his agenda and to punish countries that do not bend to his will, as recently occurred with Columbia. Many economists regard such tariffs as likely to aggravate the rate of inflation. Many economists also see increased inflationary pressures resulting from the President’s proposed tax cuts which, despite claims by the President to the contrary, will not be offset by revenues from increased tarifis. Many economists also foresee labor shortages resulting from the mass deportation of undocumented migrants as also adding to inflationary pressures. Under current circumstances, efforts to project future inflation rates are a fool’s errand. The Union characterizes the Board’s financial position as very strong, the strongest in many years. The Union recognizes that going forward the Board will no longer have federal Covid relief funds but urges that those funds enabled the Board to greatly strengthen its financial position. The Union observes that CPSs General Fund Balance, at $1.3 billion, is the highest it 'CTU contends that this shortfall is aggravated by the increased costs of housing in the city of Chicago, noting that employees are required to reside inthe City. CTU points to the Zillo Home Value Index which during this time petiod increased a compounded 3296. However, as noted above, whereas Section 14 ofthe IPLRA authorizes the interest arbitrator to consider “[sJuch other factors, nt confined tothe foregoing, which are normally or traditionally taken into consideration in the determination of wages, hours and conditions of employment ...”, the IELRA contains no similar provision. I lack authority to add to the delineated statutory criteria.