Up until minutes before the October 10 midnight deadline, the Chicago Teachers Union was prepared to strike. It looked like a repeat of its 2012 showdown with Mayor Rahm Emanuel.

Instead, a marathon bargaining session produced a tentative deal. Classes resumed October 11, as teachers mull the details of the settlement.

But there’s no doubt that the teachers won something unprecedented. They pressured the mayor into pulling money out of Chicago’s treasure chest of diverted property taxes, the Tax Increment Finance program.

Hours after averting the strike, the mayor announced that he would draw $175 million from TIF funds to fill city budget holes—including $88 million to pay for the settlement with the teachers.

Emanuel, like Mayor Richard M. Daley before him, had claimed that the district was broke and the only solution was for teachers to give up pay and benefits. The union, headed for the past six years by the Caucus of Rank-and-File Educators, changed that discussion—refusing to limit its bargaining to scraps from a continually shrinking pot of money.

The teachers insisted that the district was “broke on purpose,” pointing out how the city was willing to fund glitzy development projects like the DePaul Stadium. CTU spent years making the case that TIF money should go to fund desperately under-resourced schools.

READY TO WALK

As the strike deadline neared, teachers, parents, and supportive elected officials built up public pressure, emphasizing that the mayor’s efforts to pit parents against teachers—and teachers against their union—were failing.

Charter Solidarity Although the Chicago Teachers Union criticizes the expansion of charter schools, it has prioritized supporting charter teachers as they organize to join Chicago ACTS. One-fifth of Chicago charter schools are unionized. Both local unions are affiliated with its same parent union, the Teachers (AFT), but CTU funds organizing staff and leads bargaining for unionized charter teachers. After negotiations stalled at the largest chain, UNO, teachers voted to strike. They announced a deadline of October 19—which meant their strike could have coincided with the public school teachers’ walkout. “The boss is asking for the same concessions that Chicago Public Schools is asking for,” said Chicago ACTS President Chris Baehrend—including the pension pickup, since charter teachers are part of the same pension plan. As recently as January, UNO faced scandals over spending taxpayer funds on travel, expensive restaurants, and development contracts handed out to the operator’s relatives. Charter schools, like district schools, are publicly funded. But the charter teachers had to unionize before they could negotiate over how those funds from the city are spent. UNO teachers rallied on October 13 at the chain’s downtown Chicago headquarters. Now that the public school teachers have settled their contract, Gunderson said, “We can pivot our support to them.”

A week before the walkout date, neighborhood organizations, aldermen, and state legislators held a press conference demanding that Emanuel “free the funds” to settle the contract. Teachers and parents held “walk-ins,” morning pickets at select schools around the city.

The last day before the strike was a school holiday. Parents picketed with their kids outside the mayor’s house. Teachers set up a strike headquarters, painted banners, and assembled picket signs. Delegates dropped by to pick up batches of signs, flyers, and red T-shirts for their schools.

After years of escalating tactics and building community support, the district could see that teachers weren’t bluffing. Politicians and the public were repeating the union’s message; the mayor was the one they saw being unreasonable.

And this time, the teachers were preparing to last through a long strike. Activists had talked with their co-workers about saving money and taking out loans if needed. “We told all our members to be ready for a month,” said bargaining team member Michelle Gunderson.

The looming threat pushed Emanuel and his hand-picked school board to cough up the money to make a deal.

Teachers are reviewing the full tentative agreement, which the bargaining team immediately shared online. The union’s House of Delegates will vote on it October 19, and then the general membership still has to ratify it.

WINS ON BOTH FRONTS

Chicago teachers have been in negotiations with the mayor-appointed school board for 14 months. Their key demands were a mix of bread-and-butter proposals—fighting cuts to pay and benefits—and proposals on student issues, like smaller class sizes.

Members of the union’s 40-member bargaining team knew they would need to win on both fronts to make a deal acceptable even among themselves, much less to the union’s 27,000 members, and to maintain strong community ties for future fights.

In the last few hours of negotiations, Gunderson said, the team kept its discussions focused on two questions: “How is this a win for teachers? How is this a win for children and our communities?”

At 10 p.m. the bargaining team told the press that it was reviewing a district proposal line by line, but that there was still no tentative agreement.

In the final hour they got three big things—relief on class sizes for the district’s youngest students; an increase in the number of counselors; and 10 months’ pay for laid-off teachers awaiting reassignment.

“It takes a lot of courage to say yes once you’ve got the momentum of the strike built,” Gunderson said. “It’s a hard train to stop.”

PAY CUT AVERTED

Bargaining team members acknowledge that the settlement falls short of the teachers’ early demands on evaluations, workload, and class size.

But it restores the step-and-lane wage increases that were suspended a year ago, preserves the school district’s 7 percent payment into current teachers’ pension, and gives new teachers raises that virtually offset their taking on the pension payment. (The changes affect only who pays into the pension, not the benefits teachers receive.)

In their 2012 strike, the teachers fended off merit pay and limited the influence of standardized tests on teacher evaluations. In exchange, the union agreed to new limits on its layoff language—which made it hard to protect teachers when the district followed up with mass school closings and layoffs.

This new settlement makes some amends, guaranteeing laid-off teachers 10 months in a paid reassignment pool (restoring contract language the union lost in 2012) and adding stronger recall rights and layoff protections, which they haven’t had in decades.

Teachers are still subject to a flawed and arbitrary evaluation system, where test results are a factor. But the union won additional rights to grieve unsatisfactory evaluations, and an end to evaluating teachers schoolwide on tests outside their own subject areas. Gunderson sees this as a foot in the door for the union to keep fighting for a fairer evaluation system.

LAYOFFS STILL IN FORCE

On the negative side, the teachers did not manage to reverse cuts that happened before the settlement.

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Just before the school year began, the district laid off 1,000 employees, including 500 members of the union. Two weeks before the strike deadline, after making enrollment adjustments, it laid off another 237 teachers.

The cuts to special education have been particularly harsh, said special ed teacher Sarah Chambers, also on the bargaining team. Staffing is barebones, she said: “We have class sizes of 50.”

That means schools aren’t meeting the legal requirements laid out in federally mandated individualized education plans for students with disabilities, such as an additional aide or one-on-one care.

In fact, with 600 vacancies for special education teachers, Chambers said, often it’s untrained substitute teachers who fill the gap. “They don’t know how to teach students with disabilities,” she said. “They [students] aren’t getting the proper services.”

Early in the school year, supervision was so short that one child reportedly ran out of a school building. “They cut special education buses,” Chambers said. “Students are not even able to get to school.”

Though far from perfect, the district’s eleventh-hour offer was a dramatic improvement over the one union members rejected in January, where the pension pickup would have been phased out for all teachers—continuing to suspend steps and lanes—in exchange for the district’s promise not to lay off more teachers or open new charter schools.

After the union’s big bargaining team rejected that offer, the situation seemed dire. Chicago Public Schools CEO Forrest Claypool announced he would impose the pension pickup cost on teachers in their April 1 paychecks. But after the union announced a one-day strike, the district blinked and backed away from imposing the cut.

The teachers struck on April 1 anyway. Though they were still far from settling a contract, they proved once again that the union leaders were backed by rank and file teachers, ready to act.

TIFS ARE FOR KIDS

The teachers’ major demand was that the city come up with $200 million in additional funds, enough to increase education spending by $500 per pupil.

There was little hope of relief from the state, since the Illinois’s Republican billionaire Governor Bruce Rauner is refusing to send state funds to cover Chicago pension costs or offer additional funds to alleviate the funding shortages.

But the teachers set their sights on the TIF program, which diverts property taxes into subsidizing corporate developers. The program was originally intended to help blighted areas—but in practice, it became a slush fund for the mayor’s pet projects.

Over the years the TIF funds accumulated to more than $1 billion outside the city budget that could be doled out to corporations and developers, even in parts of the city where it was dubious to claim blight. The money has been used to subsidize luxury housing and big-box retail stores, often passing through the hands of politically connected developers and big banks.

“The way that funds are moving in the city is a reflection of the mayor’s priorities,” said Johnae Strong, a former teacher who now coordinates the union-community coalition Grassroots Education Movement. “Resources go away from communities and into investments in private interests. It’s why we see so much chaos and destabilization.”

Chicago reporters and activists have decried the TIF program for decades. But by collaborating with community groups to hammer at city government for more funding, the union changed the dynamic, Strong said.

“The biggest change is the understanding that we are not just fighting one fight, one issue,” she said. “We’ve become more united in terms of thinking of how to force solutions.”

‘CART BEFORE THE HORSE’

The fight over TIFs had a slow fuse. You can trace it back to a 2011 protest, when teachers teamed up with other unions and a neighborhood group to march from a recently shuttered elementary school to a Cadillac dealership that had received $8 million. Activists occupied the dealership, demanding that it return the TIF money to the city to be used for schools.

Over the years the teachers and their allies kept hammering on the issue, most recently training their spotlight on TIF recipients such as United Airlines, DePaul University’s new stadium, and restaurant owner Larry Levy, who got $30 million for a downtown development.

Before the strike, teachers and allies were pushing for a city council ordinance co-sponsored by Alderman Sue Garza, a former school counselor and Chicago Teachers activist who won office last year.

Garza was a leader in her school during the 2012 strike. She said four more years of education cuts have been devastating, “It’s 10 times worse than what it was like then,” she said. “Class sizes are bigger, the school year is longer. So many people have lost their jobs.”

The Garza-Cardenas TIF ordinance would direct the city to put $200 million of the TIF surplus into public schools. Before the strike deadline, 40 out of the 50 alderman publicly supported it.

Despite these declarations, it’s unclear whether the ordinance can pass. So far the mayor and his city council allies have obstructed efforts to bring it to a vote—and Garza said the council members all want TIF funds for their wards.

But if you’re starving school budgets to build luxury condos, “you are putting the cart before the horse,” she said. “We aren’t going to need development if we don’t educate people.”

THE FIGHT CONTINUES

Though the union neutralized the threatened pay cut, there’s a separate financial problem still looming. The pension is underfunded, after losing big in the financial crisis.

Teachers and allies will need to keep pushing to find revenue sources for the pension payments that are coming due—and to keep expanding the district’s spending on student needs.

Luckily, TIFs aren’t the only revenue source the union has identified. Another longtime target is investment banks, which have drained tens of millions annually from the school district budget in interest on “swaps” contracts.

These bad deals mean the district has continued to pay a high fixed interest rate while the banks reaped profits from the historically-low post-crash interest rates. In a 2012 “grade-in,” teachers graded papers in the lobbies at three Bank of America locations to highlight how the banks were exploiting corporate tax loopholes to starve schools.

“There’s a lot of money in this city and in Illinois,” Chambers said. “It’s really a tax structure problem.”

These fights are far from over. But it’s a real milestone that the teachers finally forced the city to find money it claimed it didn’t have. For schools, and for all kinds of public needs in Chicago, TIF funds aren’t off-limits anymore.