Sitthixay Ditthavong / AP
Members of community group Parents 4 Teachers display pro-teacher posters outside City Hall on Friday in Chicago. The Chicago Teachers Union has threatened to proceed with plans to strike on Monday, if negotiations fail.
By NBC News staff and wire services
CHICAGO -- Chicago Public School officials said late on Saturday they believed they were "very close" to reaching an agreement with teachers to avert what would be the biggest U.S. labor strike in a year over Mayor Rahm Emanuel's demand for sweeping school reforms.
Some 29,000 teachers and support staff have threatened to strike on Monday, setting up an awkward confrontation between Emanuel, President Barack Obama's former top White House aide, and organized labor in the president's home city.
A protracted stoppage could sour relations between Obama's Democrats and national labor unions, who are among the biggest financial supporters of the Democratic Party and will be needed by the party to help get out the vote in the November 6 election.
Both sides in the dispute expressed some optimism at the end of negotiations on Saturday evening - with school officials sounding more hopeful than the union. The two sides will resume talks on Sunday morning.
"This is a proposal that we believe is very close to what is needed to do a deal," said school board president David Vitale.
"We have listened. We have moved dramatically on almost all of these issues to try to accommodate them and to respect our teachers."
Chicago Teachers Union President Karen Lewis said the offer was improved, but she would not call it "dramatically" improved. Union officials departed from union headquarters singing "Solidarity Forever."
And the union earlier Saturday said it would set up strike headquarters in anticipation of an impasse, NBCChicago.com reported.
"There's enough distance between the two sides that without some real movement, we're not going to get this thing done on time," CTU vice president Jesse Sharkey told NBCChicago.com.
If teachers walk off the job Monday, it would be the first teachers strike in Chicago in 25 years, affecting up to 400,000 students.
View NBCChicago.com's complete coverage of Chicago teachers contract issues
School officials have encouraged parents to have contingency plans on Monday. Chicago Public Schools Chief Jean-Claude Brizard said 144 schools would remain open for half-day programs from 8:30 a.m. to 12:30 p.m. in the event of a strike, according to NBCChicago.com.
A protracted stoppage could sour relations between Obama's Democrats and national labor unions, who are among the biggest financial paymasters of the Democratic Party and will be needed by the party to help get out the vote in the November elections.
While Emanuel did not attend the talks, he and Lewis have clashed, and she has accused him of being a bully and using profanity in private meetings.
When talks ended on Friday, the union described the latest offer from the school district as "totally unacceptable."
Difficult times, new direction
At issue is teacher pay and school reforms, such as tougher teacher evaluations that are the core of a national debate on improving struggling urban schools.
Emanuel is offering a 2 percent pay increase annually over the next four years, while the union wants substantially more.
The 402,000 students of Chicago's public schools score poorly on standardized reading, math and science tests in most national studies, and the union says that class sizes are far too big.
Emanuel, who has a reputation as a tough negotiator, is demanding that teacher evaluations be tied with standardized test results, a move the union is resisting.
Only about 60 percent of high school students in Chicago graduate, compared with a national average of 75 percent and more than 90 percent in some affluent Chicago suburbs.
More than 80 percent the students in Chicago public schools qualify for free lunches because they are from low-income families.
Until Emanuel pushed through a longer school day this year, Chicago elementary school students received fewer hours of instruction per year than any of 30 major city school districts studied by reform group National Center on Time and Learning.
Chicago pushes longer school days as key to achievement
The city has little room to sweeten the pot in the negotiations because the school district has already drained its budget reserves and levied the highest property tax allowed by law to finance schools.
It also faces a crushing burden of pensions promised to retiring teachers that an independent watchdog said the city can no longer afford.
Major credit rating agencies have downgraded the Chicago Public Schools debt rating, meaning that it will have to pay higher interest rates if it issues bonds.
“Teachers want to be in the classroom but we need to stand up for our rights," Albert Delgado, a teacher at the Whittier School in the city's Pilsen neighborhood, told Reuters. "I can only say that the teachers I spoke with believe we will be on the picket line (on Monday)."
This article includes reporting by NBCChicago.com, NBC News’ Sevil Omer and Reuters.
More content from NBCNews.com:
