Urban Prep’s strike is on day two as CTU reports financial concerns

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CTU and management negotiated until late Monday, but remained far apart on issues such as probation and special educational needs.

  • 7:30 a.m. TODAY, Tuesday, June 8th: socially distant press conference with educators, parents. Urban Prep Englewood Campus, 6201 S. Stewart Ave.

CHICAGO – Teachers at three Urban Prep campuses will a Press conference at 7:30 a.m. TODAY, Tuesday June 8th at the Englewood Campus by Urban Prep, is located 6201 S. Stewart Ave.to discuss the next steps in their efforts to get a fair contract and reopen schools. On Monday, educators went on strike at Urban Prep’s three locations: West, Englewood and Bronzeville. Despite numerous requests from striking teachers to continue negotiations, the management of Urban Prep did not agree to a new meeting until Monday at 5:30 p.m. The parties negotiated until late Monday night, but despite some productive talks, Urban Prep was unwilling to compromise on some of the teachers’ key issues in order to reach an agreement.

Sticking points include Urban Prep’s refusal to enshrine student special education rights in an enforceable contract language and management’s insistence on firing educators for extended periods of time, even if they are highly skilled, despite the charter provider’s notoriously high teacher turnover.

Teachers also report troubling financial practices at Urban Prep, whose CEO makes almost as much to run just three schools as the CEO of CPS makes to oversee more than 500 schools.

These practices include the charter operator’s story of resorting to payday loans to finance school operations – although CPS Urban Prep provides the same funding as other charter and district schools. Worrying financial instruments that Urban Prep’s management have entered into include “future receivables sales” agreements with merchant cash advance organizations. These contracts are unknown in the public education sector and even rare among charter schools because they inevitably involve shockingly high interest rates.

Many of the financial services providers Urban Prep has done business with have addresses in New Jersey and New York, states with laws favorable to their operations. These agreements are not structured like typical loans; Instead, one party sells a portion of its future earnings to the lender at a fixed price – usually at a big profit for the lender.

For Urban Prep, this has meant that its future earnings from CPS and other tax authorities – funds to support Chicago students and schools – will be sold to these lenders at a heavy loss. Every dollar of that loss diminishes the funds available for Urban Prep’s classroom and student needs.

In 2020 alone, Urban Prep’s management paid out more than $ 1.6 million to merchant cash advance companies – that’s nearly 30% of their annual training spend. In one of the agreements, Urban Prep sold $ 149,900 worth of future earnings for $ 100,000 – a 50% gain for Queen Funding. In another agreement with Green Capital Funding, Urban Prep sold $ 438,000 in revenue for $ 300,000, a 46% gain for Green Capital.

Urban Prep has also received a total of $ 3 million in forgivable COVID PPP loans, but teachers blame them for seeing no evidence that those funds were invested in educational needs.

The Chicago Teachers Union represents more than 25,000 teachers and educational support staff working in Chicago public schools and the nearly 400,000 students and families they care for. CTU is a member of the American Federation of Teachers and the Illinois Federation of Teachers, and is the third largest local teacher in the United States. For more information, please visit the CTU website at www.ctulocal1.org.



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