CHICAGO (Reuters) - The head of the Chicago Public Schools (CPS) said on Friday that the district will hold off on a controversial cost-cutting move affecting teachers' pension payments to allow for the labor contract process to play out.
But that move will not stop the Chicago Teachers Union from taking action that could involve a strike on April 1.
Union President Karen Lewis told reporters that everything, including a strike over unfair labor practices, was on the table for what she called an April 1 "showdown" with the nation's third-largest public school system.
The cash-strapped district last month gave the union 30 days' notice that it aims to save $65 million by reducing its contribution to teachers’ pension payments by 7 percent - a move condemned by the union, which in December overwhelmingly authorized a future strike.
While contending a teachers' strike was not legally possible until mid-May, CPS Chief Executive Forrest Claypool told reporters on Friday that the plan to end the so-called pension pickup was on hold until an independent arbiter completes a fact-finding report on April 18. That report is part of a process to reach a new contract with the teachers' union after the prior contract expired last year.
"We do not think it's appropriate to exercise our rights right now because we're still in negotiations," Claypool said, referring to the pension payment plan.
CPS is struggling with a $1.1 billion structural budget deficit, caused largely by escalating annual pension payments that will reach $676 million this fiscal year.
In the meantime, CPS on Thursday announced three unpaid furlough days for all of its workers to save an estimated $30 million for the $5.7 billion budget.
Claypool said CPS was trying to use every alternative to raise cash to make it through June 30, the end of fiscal 2016.
However, moves by Illinois Governor Bruce Rauner may choke off the district from loans on which it has depended for cash flow.
Claypool said the district is complying with a request from the Republican governor's state board of education to turn over information for a financial probe. But he disputed Rauner's contention that a finding of financial distress for CPS would allow the state to block the district from any further borrowing.
"Chicago is not part of the statute the governor keeps citing," Claypool said.
(Reporting by Karen Pierog; Editing by Matthew Lewis)