Tuesday, Jan 27, 2015Tuesday, Jan 27, 2015

Chicago school credit rating cut after strike: Moody's

Published on Sep 28, 2012 8:30 AM

(REUTERS) - The credit rating for the Chicago Board of Education was cut to A2 from A1 by Moody's Investors Service on Thursday, which cited the "moderate" increase salaries for teachers under the new labor accord that has yet to be ratified.

The school system, the nation's third largest, has not budgeted for those pay rises, Moody's said.

The outlook on the debt - about US$6.4 billion (S$7.9 billion) - remains negative.

Chicago's teachers returned to the classrooms after striking for more than a week, having won an average 17.6 per cent pay rise over four years. The school district said the new contract would cost it about at US$74 million a year.

If you are not a subscriber, you can get instant, unlimited access here