(CHICAGO) Moody’s Investors Service pushed the debt of the Chicago Public Schools further into junk territory on the same day the district’s teachers threatened to strike.

In downgrading its debt Monday from B2 to B3, Moody’s called CPS’ financial condition “precarious” and “acute.” The new rating is one notch above the C level Moody’s describes as “speculative (and) of poor standing, and are subject to very high credit risk.”

Moody’s said its revised rating “reflects the expectation that the district’s credit pressures will intensify in the current fiscal year.”

In announcing its rating move, Moody’s referenced “strong employee bargaining groups that impede cost-cutting efforts.” The Chicago Teachers Union announced Monday its members voted 95 percent in favor to authorize a strike if necessary to obtain a new contract.

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