A “letter of intent” is essentially a contract to contract. One way that we have heard it described is that it is like being engaged to be married—a serious commitment, but not yet a legal contract.

For the purposes of Public Act 106, we encourage districts to clearly define the conditions that much be met in order to the intent proceed to contractual commitment. For example, districts need to clearly define that their participation is contingent upon reaching agreement with all employee groups through collective bargaining, all districts should clearly define that favorable loss ratios are a factor, etc.

One way a letter of intent may be invalidated is if all parties decide to stop proceeding. But parties should consider what would happen if only one or two parties changed their intent (and terminated their participation with the collective intent) at some point in time. Does it matter what proporation of the total employees these parties represent? If so, how will that be measured?

Each district is advised to seek legal counsel and thoroughly understand the practical, legal, and political implications of executing a letter of intent.